To date, the number of Islamic financial institutions worldwide has increased to more than 300, spanning more than 75 countries both in the Muslim and non-Muslim countries. 1 The expansion of the inter-linkages among intermediaries and markets across regions would contribute towards a more efficient allocation of financial resources across borders and thus contribute to enhancing global growth prospects. The fifth dimension that has seen significant change is in the development of human capital in Islamic finance. It has been a vital development that has been key in ensuring an adequate supply of talent and expertise for further expansion and development of the Islamic financial services industry. High caliber professionals that have the combined knowledge and understanding of the Shariah with the necessary skills in finance 2 are now in great demand. Recognising this, several major institutions of higher learning are offering more focussed and structured programmes in Islamic finance. The establishment of the International Centre for Education in Islamic Finance (INCEIF) in Malaysia in 2006 represents a structured investment in human capital development to support the global development of Islamic financial services industry. It is envisioned that INCEIF will act as a professional certification body as well as an education centre for specialised post-graduate programmes in Islamic finance. Distinctive features of Islamic finance While Islamic finance has continued to evolve, the distinct features remain fundamental. Islamic finance is required to operate in accordance with the rules of Shariah from which it derives its unique characteristics.

4 On the demand side, the issuer also benefits from the competitively attractive pricing of Sukuk ranging from 10 to 20 basis points lower than mainstream bonds. This has resulted from the continuous over subscription of the sukuk which has ranged from two to thirteen times. The phenomenal demand for sukuk is further reinforced by excess liquidity in the global financial system. This demand comes from a relatively wider investor base that comprises both the conventional and Islamic investors. The strong demand for sukuk has also been spurred by the higher level of surplus savings and reserves in Asia. In the case of Japan , apart from the high savings rate, Japan has the largest percentage of high net worth individuals wealth distribution in the Asia Pacific. From the investors' perspective, besides the intrinsic value of sukuk which is largely assetbacked, convertible to shares and exchangeable with shares, there are benefits of  3  Source: GCC Research , Kuwait Finance House. 4  An estimate amount of investments for Eastern Corridor Economic Region (RM112 billion), Northern Corridor Economic Region (RM100 billion), Iskandar Regional Development (RM382 billion) and Sabah Development Corridor (RM25.8 billion). 4  BIS Review 23/2008  diversification. Sukuk is fast becoming a new asset class. Sukuk has also generated good investment returns for investors arising from its higher pricing in the secondary market due to the "buy and hold" preference and its scarcity. Opportunities in takaful The other opportunities in Islamic finance are in the takaful or Islamic insurance and retakaful.