	Background

Islamic finance is based on shariah , an Arabic term that often is translated to "Islamic law." Standardization of Islamic finance regulations has been of increasing interest in the industry. Islamic finance laws and regulatory practices vary across countries. Islamic Finance Trends

Estimates vary of the size and growth rates of assets held internationally under Islamic finance, but suggest that Islamic finance is a rapidly growing industry. While it represents a small proportion of the global finance market (estimated at 1%-5% of global share), the Islamic finance industry has experienced double-digit rates of growth annually in recent years (estimated at 10%-20% annual growth). Global Financial Crisis

Internationally, Islamic banks appear to have been more resilient to the primary effects of the global economic turndown and international financial crisis than conventional banks. However, as Islamic banks operate within a global financial system, they have not been completely insulated from the recent economic and financial shocks. Traditionally concentrated in Muslim-majority countries in the Middle East and Asia, in recent years, Islamic finance has expanded to other countries with smaller Muslim populations. A number of countries are revising their tax, legal, and regulatory frameworks to attract Islamic finance. Islamic capital market securities, now a fast-growing segment of the Islamic finance industry, were first introduced in 2001 (discussed in the next section). Peaking in 2007 at around $35 billion (although higher according to some estimates), sales of new Islamic bonds dropped to about $15 billion in 2008 and rose to $20 billion in 2009 (see Figure 1 ). Islamic Finance in the United States41

In the United States, there is growing interest for Islamic finance and business opportunities for lenders. Some U.S. financial institutions express concerns about the possible ties of some Islamic institutions to terrorist finance networks.
Islamic finance is based on principles of shariah, or "Islamic law." Major financial principles of shariah are a ban on interest, a ban on contractual uncertainty, adherence to risk-sharing and profit-sharing, promotion of ethical investments that enhance society, and asset-backing.
While the Islamic finance industry represents a fraction of the global finance market, it has grown at double-digit rates in recent years. By some estimates, total assets held globally under Islamic finance reached $1 trillion in 2010. Islamic banks have appeared to be more resilient than conventional banks to the immediate effects of the international financial crisis and global economic downturn. Some analysts have attributed this to Islamic banks' avoidance of speculative activities. However, the Islamic finance industry has not been completely immune to the general decline in demand and investor uncertainty. Global issuance of Islamic capital market securities (sukuk), a fast-growing segment of the Islamic finance industry, peaked in 2007 at $35 billion, declined to $15 billion in 2008 and then rose to $20 billion in 2009.
Islamic finance historically has been concentrated in Muslim-majority countries of the Middle East and Asia, but has expanded globally to countries with smaller Muslim populations. A number of European and other countries are working to reform their tax, legal, and regulatory frameworks to attract Islamic investments. There is a small but growing market for Islamic finance in the United States.
Through international and domestic regulatory bodies, there have been efforts to standardize regulations in Islamic finance across different countries and financial institutions, although challenges remain. Critics of Islamic finance express concerns about possible ties between Islamic finance and political agendas or terrorist financing and the use of Islamic finance to circumvent U.S. economic sanctions. Supporters argue that Islamic finance presents significant new business opportunities and provides alternate methods for capital formation and economic development.