Islamic Finance

The growth and development of an Islamic capital market and finance depends on the institutions in which its dispute resolutions are anchored. The institution for Islamic finance dispute resolution and its practitioners must be knowledgeable and versed in Islamic finance. Despite this, those who are trained in common law, either as judges or advocates, continue to weigh a considerable influence in matters that border on Islamic finance dispute resolution. This problem is further compounded by the constitutional backing given to these judges and advocates.

The paper’s purpose is to contribute to the existing body of work in the area of Islamic finance through the discovery of the feasibility of effective dispute resolution mechanisms for the resolution of disputes for Islamic banks and institutions offering Islamic financial services. This is investigated to determine whether the Shariah framework for the enforcement of financial contracts and dispute resolution is a legal risk or appropriate alternative mechanism to the world on whole, individual countries, the business environment, organisations and individuals.

This discursive research paper is appraising issues pertaining to legal compatibility of sukuk, which is at the heart of Islamic finance.

With the emergence of Islamic finance, legal precepts of

The FSAP, initiated by the IMF and the World Bank, has been implemented internationally including the IDB and IFSB member countries. The initiative is beneficial to further improve the quality of the financial industry as well as to contribute to global financial stability. The rapid growth of Islamic finance internationally poses new challenges to the supervisory authority particularly with the growing significance of the newly developed industry.

This paper provides a critical review of the Islamic Economics (IEs) and Finance (IF) literature that have examined the stability of the Islamic Financial System (IFS) and its institutions vis-à-vis the conventional interest-based system. The authors have been able to analyze thirty-four investigations over a thirty-year period, from 1983 to 2013. The research aims to provide an account of the main findings and conclusions of the literature, discuss the robustness and comprehensiveness of these findings, and highlight some venues for future explorations.

This paper studies the international transmission of bank liquidity shocks from multinational Islamic bank-holding companies to their subsidiaries. Based on a total sample of 120 Islamic and conventional bank subsidiaries, we test whether foreign bank lending is determined by different factors for Islamic and conventional banks. We estimate a model that includes subsidiary and parent bank characteristics as well as host and home country variables. Our empirical findings show that conventional parent bank fragility negatively affects lending by their subsidiaries.

Stress testing is an essential risk management tool that helps financial institutions to identify, assess and mitigate risks in their businesses. Stress tests have been and are an excellent tools for understanding the plausible impact of a “what-if scenario” in the banking industry. The global financial crisis has placed the spotlight squarely on stress tests. Though Islamic banks operate within the similar financial environment, their balance sheet composition calls for different treatment in stress testing.