Describing the Islamic financial system simply as 'interest-free' does not do justice to the system. Promotion of entrepreneurship, preservation of property rights, transparency and the sanctity of contractual obligations, which are crucial to any sound financial system, describe its essence. Today, Islamic financial and banking activities have reached an impressive size of over US$250bn, as co...

Contemporary research on investment behaviour in Islamic perspective, most of the time, finds it expedient to assume zero rate of time preference in an Islamic economy. The author argues that there is no justification for that. According to him, there is nothing against positive time preference or against realizing a time value of money in an Islamic framework, as long as time value of money is...

This paper exposes the “roadmap” of how modern Islamist terrorism is financed, through both legitimate and illegitimate means: the networks and linkages between financing obtained on the one hand through sympathetic Islamic governments, Islamic charities and banks, seemingly legitimate businesses operating as fronts, and on the other hand through criminal activities running the full gamut from ...

Islamic finance is a prohibitions-driven industry, which aims primarily to circumvent the canonical Islamic prohibitions of riba and gharar. The concepts of riba and gharar may best be understood as unbundled sales of credit and risk, respectively. An obvious solution is to adopt mutual structures for financial intermediaries of credit (e.g. banks) and risk (e.g. insurance companies), as early ...

Employing data on over 100 GCC banks for 1996e2011, we test the relation between risk and capital. Given the interlinkage between these two variables, the model employs a 3SLS estimation that takes on board this simultaneity. Consistent with the literature, risk is measured by the Z-score, while capital is computed as the ratio of equity to asset. The findings indicate that banks generally incr...

Islamic banking is one the most blossoming doctrine in economic system of the world. The Fast growing awareness about Islamic financial system has brought strong feeling to Muslims to confront the western interest-based economic cycle. The Islamic economic system is emerging as a reliable alternative to the interest based system. This study is proposed to ascertain the motivational factors enco...

The aim of this paper is to evaluate the nature and changes of market concentration in the Malaysia’s Islamic banking due to the restructuring of Islamic banking industry within the liberalization wave in the banking market. A total of 17 Islamic banks operating over the period of 2000-2010 had been considered. The structural approach framework was used to evaluate the nature and changes of mar...