Thesis

This thesis provides a brief history of

The author's goal is to assess the contribution of Islamic banking to the development of the Sudanese economy and the scrutiny they face given their past role in development financing. Questions have arisen about the banks' past roles in supporting trade finance and not promoting equity finance. The sentiment is that the contribution of Islamic banks to development finance is insignificant. This is so, according to the author, because of the attitude of the bank management, government policy makers, and the general complexities that exist in the Sudanese economy.

This thesis discusses the Islamic concept of profit within the context of interest or riba. The objective of the writer is to show how these institutions work and show the instruments they use to substitute for interest to induce deposits. Methodologies to determine the structure of depositors' share in investments and profit are detailed.

The work discusses the important role of depository institutions in Islamic banking. The author first points to debt contracts as a most useful tool of these institutions but affirms that such instruments are risky and contribute to economic instability, especially when a composite of the debt of the country, institutions, and individuals is considered. The writer suggest a fundamental reform in the depository institutions' daily practices but notes that limiting such reform to supervisory and regulatory measures, albeit necessary, is not enough and may be precarious.

A combination of several undesirable macroeconomic conditions will contribute to the process of deregulation, and the extent of monetary policy instruments have changed in relation to the perceived liberalization of the economic environment. An increase in the degree of competition, a more efficient distribution of portfolios, and a decrease in the amount of liquidity can all be attributed to decreased regulation in the environment.

Though each county faces unique challenges and has followed different paths to economic development, both Kuwait and Bahrain have reached similar levels of development. In this study the role of financial institutions in economic growth is examined, from both theoretical and empirical perspectives.