Islamic Finance

This thesis explores the history of the legal and administrative development in the Arab Gulf states and the U.A.E.; the history, growth, and development of banking in the U.A.E. and an examination of the legal practice adapted by the Federal and local courts in the U.A.E.; comparative laws and practices of neighboring Arab states and the commercial law and the problems of loans, banking facilities and interest, plus legal dilemma caused by the interest in banking disputes; letters of guarantees in light of the current practice in U.A.E.

In three essays the author delves first into the topic ''Asset and Currency Prices in an Exchange Economy with Transactions Costs'' where he examines the behavior of equilibrium asset and currency prices in an exchange economy. In an exchange economy the use of money is encouraged by transactions costs. The author compares the transaction costs approach to the cash-in-advance approach. Next the author selects the topic ''Demand Deposit Financing: Debt versus Equity'' where he discusses the issues of the effects of financial deregulation of the banking system.

The author examines the possible introduction of interest-free banking in Kuwait, its implications, operations, advantages and disadvantages, and the transformation process under which such transition would occur - all within the aftermath of the Islamic resurgence movement. The first chapter presents an overview of the Islamic economic system and underlying principles which are the considered by the author to be the cornerstone for change from a conventional economic system to an Islamic one.

The philosophical and economic underpinnings of Islamic and Western banking are investigated in this study together with financial management concepts, Islamic financing instruments, and problems and expected opportunities/obstacles in the U.S. and the possibility of the acceptance of Islamic banking in the U.S. The author used a survey to collect data on U.S. acceptance as perceived by

Iran has been the one Muslim nation to declare its intention to establish political and economic institutions according to strict Islamic principles.

This dissertation investigates the formulation and implementation of Pakistan's zaka system, and evaluates the effectiveness of this public welfare system on the basis of the level of assistance provided and the operational costs. The system collects a 2 ½% levy on financial accounts, and local committees distribute payments to those determined most eligible. The money collected through the

This study examines issues relating to the viability and developmental effect of Islamic banking in its first decade, and offers policy recommendations with respect to profit performance, rates, and non-pricing strategies. The rejection of interest inhibits banks' abilities to gain short-term earnings, given that interest-based money market instruments are prohibited. How can Islamic banks overcome this deficiency in their earnings prospects? Why do Islamic banks move away from projects toward collateral-based lending and trade financing?

This study offers an introduction to the Islamic banking system in Bangladesh, focusing on the legal and regulatory issues facing this industry. It examines the development of the legal framework within which Islamic banks operate. It also addresses the theoretical and operational differences between Islamic banks and conventional banks. The study examines the prospects of the Islamic banking industry in Bangladesh and offers insights as to how these prospects may be improved.

This thesis discusses the three main choices economic policymakers have regarding their relation to interest: prohibiting it, limiting it through usury laws, or allowing free market forces to regulate it. The writing opens with an historical study focusing on the origins of the prohibition of interest followed by an examination of interest-free banks - banks that share profits/losses with its depositors rather than paying fixed returns. There are not many such banks in existence today, but they are becoming increasingly important in the economic marketplace.

This study compares the financial performance of the Kuwait Finance House (KFH) with interest bearing investment and banking sectors in Kuwait, explores the banking needs and attitudes of the KFH's and other established banks' customers, and evaluates the accuracy of KFH officials' predictions about their customers' needs and wants. The interest-free KFH showed substantially better financial performance than interest bearing investment sector means.