Conferences

Islamic equity funds (IEFs) differ fundamentally from conventional equity funds since Muslims are prohibited to invest in certain companies/sectors and pay or receive interest. This paper analyzes the risk and return characteristics of a sample of 145 IEFs and determines their risk-adjusted performance over the period 2000 to 2009. Our results show that IEFs are underperformers compared to Islamic as well as to conventional equity benchmarks. This underperformance seems to have increased during the recent financial crisis. We also find that IEF managers are bad market timers.

Critics of the current situation of Islamic finance contend that the newly developed Islamic financial products are not compatible with the ideal of Islamic economics, because these products are approved at patchwork screenings by a Sharia advisory board. After the middle of the first decade of the twenty first century, in order to overcome this situation, several new ideas were proposed by those who aspire the ideal of Islamic economics.

Does inefficient bank assume more risk? Is there any major difference between Islamic and conventional banks in terms of efficiency and risk taking propensity? The paper aims to answer these questions in the context of Bangladesh. Although few studies are available in the existing literature that compare the performance between Islamic and conventional banks, almost no such study that examine the relationship between capital, risk and efficiency of banks in Bangladesh exists. The paper aims to fill this gap.

There is a huge number of definitions of Islamic Economics available in the literature. The vast majority take existing definitions from the western literature and modify them to incorporate an Islamic angle. This leads to the widespread belief that Islamic Economics is a variant or a branch of conventional economics. We argue that something can be called “Islamic” only if it is based on the Quran and Sunnah. In this paper we propose a new definition based purely and directly on Islamic ideas and sources.

Conventional finance suggests that the higher the risk of an investment, the higher the return it should give. Nevertheless, whether Islamic stocks that offer alternative investment in the stock market suggest different risk-return relationship still needs to be investigated. This empirical study is aimed at assessing risk-return behavior of Islamic stocks. This study employs cross sectional data of portfolio developed using beta-rank and market capitalization, in which daily data will better reflect the real volatility.

During a recession, state-owned banks in Indonesia tend to place their fund in the central bank’s certificate, as real sector becomes less attractive. On the other side, Islamic bank’s strong dependence on the accomplishment of its Profit-Loss Sharing (

Basel Accords promote Value at Risk (VaR) that is the most used method as the preferred one to measure and report market risks of financial institutions. Using VaR usually requires having asset valuation models and identifying their risk factors as model input parameters, allowing thus to stress them and calculate valuations (mark-to-market or mark-to-model). The previous requirements will make VaR calculation - roughly adapted from conventional finance - complicated for Islamic finance as there are not well-known valuation models and the risk factors may not be easily identified.

This paper investigates the impact of ownership structure, measured by two dimensions: nature of owners and ownership concentration, on bank risk, controlling for country and bank specific traits and other bank regulations. Particularly, it compares risk-taking behaviour of conventional and Islamic banks in 10 MENA countries under three types of bank ownership (family-owned, company-owned and state-owned banks) over the period 2005-2009. The result shows a negative association between ownership concentration and risk.

This paper is concerned with the role of ethics, morality, maqasid al-syariah and altruism in economic life. It is not concerned with welfare economics or related normative issues, but with the way in which ethics, morality and altruism influence the actual behavior of economic agents. The terms Ethics, Morality, Maqasid Al-Syariah, and Altruism have somewhat different connotations.

This paper investigates the inter-temporal relationships between bank efficiency and problem loans and financing of conventional and Islamic banks as proposed by Berger and DeYoung (1997). The efficiency level and the managerial behavior of conventional and Islamic banks in the Organization of Islamic Cooperation (OIC) countries divided into the regions: Asian, African, Middle East and Turkey are investigated during the period 1993-2007. The findings show that cost efficiency is higher than profit efficiency for the sampled banks in the OIC countries.