Malaysia is well acknowledged to be a frontrunner in the dual-banking system, referring to the co-existence of the Islamic banking system and conventional banking system. Propelled by the aim to establish Malaysia as an international hub of Islamic finance and the need to have a stronger and more resilient banking sector in the aftermath of the 1997/1998 Asian financial banking sector consolidation initiative witnessed mergers and acquisitions of the then existing banks resulting in substantial reduction in the number of conventional commercial banks in the market. The number of conventional commercial banks declined from 35 in 1998 to 22 in 2009 and then, with new additions of foreign banks, increased to 27 at the end of 2016.
