Asian Development Bank has formed an alliance with the Islamic Financial Services Board to promote Islamic finance in common developing member countries.

The partnership was signed to address the expanding potential for Islamic finance in the Asian region, with Malaysia at the helm as the largest market. The memorandum of understanding serves as a basis for joint activities that support the development of Islamic finance, particularly when it comes to regulation, supervision, capital markets and liquidity management.

In a statement, IFSB said it is looking forward to encouraging cross-border cooperation with ADB to meet Asia's rising need for financial mechanisms to uphold insfrastructure spending.

The Islamic Financial Services Board is an international standard-setting organisation that promotes and enhances the stability of the Islamic financial services industry by issuing global standards and principles. Asian Development Bank is a regional development bank that aims to facilitate the economic development of countries in Asia.