Sharia-compliant investments: where do islamic banks invest?

the development of Islamic financial institutions based on the principles of Sharia is gaining increasing importance in the global economy. Islamic finance, which avoids interest transactions and investments in prohibited activities, demonstrates steady growth, attracting the attention of both traditional investors and the younger generation seeking ethical and halal financing. Strategic investments of Islamic banks, especially in technological and digital solutions, help optimize operating costs and expand the client base, emphasizing the relevance of studying their investment activities. The main research problem is to determine the specifics of investment strategies of Islamic banks, their compliance with Sharia norms and identify key areas for capital placement in the context of strict religious restrictions. The purpose of the article is to analyze the investment activities of the largest Islamic banks, identify the main instruments and areas of their investments, taking into account the principles of Islamic finance. Methods. The paper uses methods of theoretical analysis of the principles of Islamic finance, as well as an analysis of the data presented in tables illustrating the types of Sharia-compliant investment instruments (Murabaha, Ijara, Musharaka, Mudaraba, Sukuk) and the main investment areas of leading Islamic banks, taking into account their geographical presence and asset volumes. Results. It was revealed that Islamic banks actively use Sharia-compliant contracts to finance real economic assets and projects. The main investment areas of the largest banks are retail and corporate banking, SME lending, the sukuk market, real estate investments, asset management, as well as specialized sectors such as healthcare, logistics and energy. A trend towards digitalization of services and geographic expansion is noted. The total assets of the 100 largest Islamic banks reached USD 1.57 trillion, which indicates the scale of the sector. Conclusions. Islamic banks invest primarily through Shariah-compliant instruments, channeling capital into the real economy. Their investment decisions are guided by strict compliance with Shariah principles, risk management, corporate governance and the pursuit of socio-economic goals (Maqasid al-Shari’ah). Portfolio diversification across assets, sectors and regions, along with the active development of digital technologies, are key elements of their strategy in the global financial environment.

Islamic banks, Shariah, investments, sukuk, murabaha, digitalization, real estate