Islamic finance has started to grow in international finance across the globe, with some concentration in few countries. Nearly 20 percent annual growth of Islamic finance in recent years seems to point to its resilience and broad appeal, partly owing to principles that govern Islamic financial activities, including equity, participation, and ownership. In theory, Islamic finance is resilient to shocks because of its emphasis on risk sharing, limits on excessive risk taking, and strong link to real activities. Empirical evidence on the stability of Islamic banks, however, is so far mixed. While these banks face similar risks as conventional banks do, they are also exposed to idiosyncratic risks, necessitating a tailoring of current risk management practices. The macroeconomic policy implications of the rapid expansion of Islamic finance are far reaching and need careful considerations.
The Law of Banking in Nigeria - Principles, Statutes and Guidelines captures the general principles of banking law, statutes and guidelines relating to banking transactions. The book is presented in a very simple, precise, and clear language and contains three parts of thirty-one chapters in all covering the general principles of banking. It should create considerable awareness among the general public, law students, law teachers, bank customers as well as banks and bankers. Most certainly, it is a book that will assist the students and researchers in this area of law in wading through the general principles of banking law as well as the numerous Legislation and Guidelines on banking business.
Covering essential elements of Islamic Banking and Finance, as well as the latest views on topical debates surrounding the discipline, this text is essential reading for anyone seeking to understand this increasingly important sector of the finance industry. Written by Islamic scholars in the Arab world, this text gives new and pertinent insights into Islamic Banking and Finance, and its global impact.
This book is the result of a decade teaching of Islamic finance course to business graduates (Bachelor and Master classes). This book is written with a clear focus on learning of Islamic banking & finance by accounting, banking, business and finance students/professionals. This book is divided into five parts. Part-1 presents an update on Islamic finance, why and how Islamic banking started; What is current status; Meaning and prohibition of Riba (Interest & Usury) as reported in revealed books (Bible and Qur'an); business models under Islamic financial services industry; principles of Islamic financial system, similarities and differences with conventional finance industry, and challenges being faced by the nascent industry.Part two is about asset-backed financing provided by IFIs. It includes trading (selling) modes of financing including Murabaha (ch.2), Salam, and Istisna'a; it also includes rental-based financing product-Ijarah financing. Chapter 2,3,4,5 include sales and rental-based financing. Part three of the book deals with profit and loss sharing modes of financing including Musharakah, diminishing Musharakah and Mudarabah. A special section is devoted to discussing the causes of lesser application of Musharakah in operations of IFIs, in addition to Shari'ah rulings and financial impact. Chapter seven is about Diminishing Musharakah; a form of gradually declining partnership between an IFI and clients; generally used to finance real estates. Under diminishing Musharakah, the basic Shari'ah rulings, Islamic house financing, comparative study of conventional and Islamic mortgages and installment calculation under different assumptions for house financing are presented. Chapter eight is about Mudarabah. Chapter nine presents various types of deposits collected by IFIs and profit-sharing mechanism. Concepts of daily product and weight-age based profit systems are elaborated.Part four of the book presents special topics in Islamic Finance. In this part areas of liquidity management, Islamic insurance, currency system, substance & form, and challenges to Islamic finance industry are elaborated. Under Islamic capital market (liquidity management) two dedicated chapters have been included; each for equities and sukuk. Chapter 12 elaborates briefly the concept of Islamic insurance covering multiple areas including Shari'ah guidelines, takaful (insurance) models, and role of insurance company, in addition to illustrative financial calculations. Chapter-13 addresses the issue of preference for 'legal form over economic substance' by critically evaluating the selected Islamic finance contracts Last chapter identifies the challenges [potentially hurdles in sustainability, growth and expansion of the industry]. The fifth edition is the outcome of encouraging response by the academic community to earlier editions. In this edition, due attention has been given to present material in a reader-friendly mode in addition to a thorough review of content, exercises and figures. Title of the book changed by adding prefix of 'fundamentals' to reflect the nature of work (as text book). In this edition, the chapter on Islamic finance: an update is revised thoroughly; and by insertion of specific contents including principles and business models of Islamic financial system, in addition to brief presentation of challenges. Besides, Islamic capital market is re-written by including an evaluation of methodologies used in creation of Shari'ah universes of stocks. Also, a new chapter included to present the application of 'form over substance' principle to industry practices. Updated figures on the global volume of assets, application of financial products; regional shares, etc. are also part of this edition. Also, more examples included in the text to make the concept clear. An increased number of multiple-choice questions and mini cases are also forming part ofthe updated edition. I welcome readers' Feedback.
This multidisciplinary book on Islamic finance covers Islamic economic, financial, and legal systems, insurance (takaful), commercial jurisprudence, and the socio-political and political-economy of the Islamic world. It examines the dichotomies and similarities between Islamic and conventional financial systems and suggests future roles and governance of Islamic financial institutions. Distinctive features of the second edition include an emphasis on the theoretical foundations of Islamic finance, the distinctions between the micro- and macroeconomic concepts and theories to the readers, and an expansion on Islamic approved forms of trade dealings, transactions, and contracts. Furthermore, this work discusses the newly introduced Islamic capital market products of the years 2020 to 2022—including the transition from the inter-bank-offer-rates (IBORs) as global benchmark lending rate to the new risk-free-rates (RFRs) that became effective on January 1, 2022—and discusses the transition of Saudi Arabia Monetary Agency to Saudi Central Bank in 2020. Though every effort is made to avoid tedious mathematical proof and derivatives, this work provides working calculations for the pricing of Islamic instruments and provides supplemental materials in the form of faculty resources and students’ study guide and workbook. This work acts as a useful textbook for graduate and advanced undergraduate students who are looking at broadening their knowledge in finance. Similarly, this book is a helpful guide and tool for financial practitioners who are interested in learning more about the innovative discipline of Islamic finance. For financial practitioners to drive maximum benefits from this innovative financing mechanism, they need to know, understand, and participate in the investment opportunities which are provided by Islamic finance.
Islamic finance is a fast growing activity in world markets. This paper provides a survey on Islamic Finance in SSA. Ongoing activities include Islamic banking, sukuk issuances (to finance infrastructure projects), Takaful (insurance), and microfinance. While not yet significant in most Sub-Saharan countries, several features make Islamic finance instruments relevant to the region, in particular the ability to foster SMEs and micro-credit activtities. As a first step, policy makers could introduce Islamic financing windows within the conventional system and facilitate sukuk issuance to tap foreign investors. The entrance of full-fleged Islamic banks require addressing systemic issues, and adapting the crisis management and resolution frameworks. The IMF can play a role by sharing international experiences and providing advice on supervisory and regulatory frameworks as needed.
'It was a humbling experience to read the product of such a remarkable feat of scholarship. It is all at once an exploration in analytic history and a complete text of Islamic finance theory and application. It is also one of the most succinct renditions of the evolution of Islamic finance embedded in a comprehensive account of the particularities of economies as diverse as Malaysia and Turkey. This is a unique contribution to Islamic finance and Islamic economic history. It has been a rewarding learning experience. It is truly a breathtaking effort.' – Abbas Mirakhor, former IMF Executive Director and the recipient of the Islamic Development Bank Prize in Islamic Economics (2003) This illuminating and thought-provoking book questions whether classical Islamic capitalism, which has served Muslims so well for centuries, can provide a viable alternative world economic system. In the current recession – the worst since 1929 – this is surely a provocative question. But if Islamic capitalism is to emerge as a viable alternative, its nature and systems must be well understood. Murat Çizakça explores key issues within Islamic capitalism and finance, shedding light on whether the Islamic system can indeed be called 'capitalist', the principles on which the system was built, the institutions that were consequently developed, how they function and have evolved, and, perhaps, most importantly, whether they can be modernized to meet today's needs. Against the backdrop of rapid change in the Middle East, this book gives a solid background to the economic systems that will emerge in the world of Islam. An essential guide to the past, present and future of Islamic economy and finance, this compelling book will prove to be of particular interest to academics and researchers of economics, finance, economic and financial history and political science.
The growing presence of Islamic banking needs to be accompanied by the development of effective regulation and supervision. This paper examines the results of the survey conducted by the International Monetary Fund to document international experiences and country practices related to legal and prudential frameworks governing Islamic banking activities. Although a number of countries have made considerable progress in creating legal, regulatory, and supervisory frameworks that accommodate Islamic banking, there are substantial differences. This paper also identifies a number of challenges faced by regulatory and supervisory agencies regarding Islamic banking.
This book is the first of its kind to provide a critical overview and theoretical analysis of the Circular Economy from Shariah and Islamic Finance perspectives. The book is divided into three parts. The contributing authors pay close attention to Islamic Finance in light of sustainability and value creation. It also includes case studies on the Circular Economy application in Islamic Finance industry. The book is of interest to academics, students, and practitioners on Islamic Economics and Finance who have an interest in understanding the Circular Economy under the lens of Islamic Finance principles and applications.
