Doctoral thesis, University of Surrey
Mustafa, Badreldin G (2003)
6.4.11
The Implementation of Accounting Standards for Islamic Banks: a Study of Preparers' and Auditors' Opinions in Sudan
Doctoral thesis, University of Surrey
Mustafa, Badreldin G (2003)
22.3.11
Opalesque Islamic Finance Intelligence - Sixteenth Issue
Mudaraba applied in the context of microfinance is the theme for the Featured Structure segment, as scrutinized by practitioner Azhar Nadeem. Hdeel Abdelhady provides an operational perspective to Islamic finance in Lex Islamicus - with particular emphasis on governance and Shariah Board reports (SBRs).
Having spent time in Matsushima (one of the three famous "views" of Japan) in the north of Miyagi prefecture, it is a welcome coincidence that the Kulliyyah Korner features the research of Kyoto-based Nagaoka Shinsuke. Our best goes to him and everyone in Japan.
The Industry Snapshot offers a further analysis of Education based on the EPL concept (Education, Perception, Liquidity), as seen by strategist Joy Abdullah. This is followed by Douglas Clark Johnson who shares his perspective on Bahrain in our Opinion Column.
We hope you enjoy the sixteenth edition of OIFI and as always we are glad to hear from our readers and welcoming all comments & feedback. Remember that you can visit our online archive (see reference link) for access to our ever-growing databank of Opalesque Islamic Finance Briefing as well as all of the back issues of Opalesque Islamic Finance Intelligence.
Download the complete issue of Opalesque Islamic Finance Intelligence here.
Alternatively you can read each article separately in the OIFI Archive:
Editor’s Note: In the Name of Egypt
Featured Resource: The Islamic Finance Consumer
Featured Structure: Islamic Business Contracts and Microfinance A case of Mudaraba
Lex Islamicus: Operational Excellence is the Key to Unlocking Lasting Value in Islamic Finance
Kulliyyah Korner: On the Theoretical Dichotomy of Islamic Finance
Industry Snapshot: E.P.L. in Islamic Finance - Education (Extra Time)
Opinion Column: Bahrain: Time to be Truly Business-Friendly
19.3.11
Call for Papers - Eight International Conference on Islamic Economics & Finance
"Sustainable Growth and Inclusive Economic Development From An Islamic Perspective"
Doha, Qatar
December 25-27, 2011
Call for Papers: The global economy continues to face the perennial problems of poverty, persistent youth unemployment, excessive inequalities of income and wealth, high levels of inflation, large macroeconomic and budgetary imbalances, exorbitant debt-servicing burdens, inadequate and aging public utilities and infrastructure, skyrocketing energy prices, and growing food insecurity. The reoccurring regional and global financial crises further intensify and magnify these problems particularly for the underprivileged segments of the world population. As a result, many countries are at the risk of failing to achieve the Millennium Development Goals (MDGs) set by the United Nations. However, some countries also present optimistic experiences to share, and from which useful lessons can be drawn for shaping the future economic scene in other countries.
The Eighth International Conference on Islamic Economics and Finance is jointly being organized by the Qatar Foundation’s Faculty of Islamic Studies (QFIS) through its Islamic Economics and Finance Center, the Islamic Development Bank Group through its Islamic Research and Training Institute (IRTI), and the International Association for Islamic Economics with the support of other stakeholders. The Conference will provide a platform for dialogue and discussions between policymakers, academics, researchers, graduate students, and practitioners to address the problems of poverty alleviation, inclusive economic growth, and macroeconomic stability from the perspective of the Islamic Economics and Finance discipline. The Conference will be held for three days during December 25 – 27, 2011 in Doha, Qatar.
Theoretical and empirical research papers are invited in Arabic and English languages for submission to the Conference in the following and related areas, subject to the conditions described in this announcement.
Tickets and Hotel: One author of each accepted paper will be paid by IRTI round-trip economy class air tickets, and hotel stay, including food during the conference.
Dates to Watch:
Submission of abstracts with CVs April 15th
Decision of Academic Committee May 5th
Submission of First Draft of Papers July 15th
Decision of Academic Committee August 15th
Submission of Final Draft October 10th
Download Call for Papers:
http://www.qfis.edu.qa/files/pdf/Eigth%20Int%20Conf%20Call%20for%20Papers.pdf
With sincere thanks to Dr. Taruqullah Khan for highlighting this information.
14.3.11
Islamic Securitisation: Part II - A Proposal for International Standards, Legal Guidelines and Structures
Mohammad Saad Lahlou, University of Westminster, School of Law
Joseph Atangan Tanega, University of Westminster, School of Law
June 2007
Abstract: "The authors propose that international standards for cross-border Islamic Securitisations be established to help overcome legal uncertainties. Given the principles of Sharia law, templates for a number of Islamic financial instruments are examined together with some examples of successful international transactions."
11.3.11
Islamic Securitisation: Part I - Accommodating the Disingenuous Narrative
Mohammad Saad Lahlou, University of Westminster, School of Law
Joseph Atangan Tanega, University of Westminster, School of Law
May 2007
Abstract: "The article examines the fundamental principles, substance versus form, and operational elements of Islamic finance as applied to Islamic securitisation. We review some central aspects of the ideological and spiritual tradition of Sharia compliance as applied to a typical asset backed securities transaction."
8.3.11
The Relationship between Jakarta Islamic Index and Other Selected Markets
Irfan Syauqi Beik, Lecturer and Researcher at the Department of Economics, Bogor Agricultural University, Indonesia
Wisnu Wardhana, Postgraduate Student of the International Islamic University Malaysia, Researcher of ISEFID (Islamic Economic Forum for Indonesia’s Development)
Abstract: "The financial crisis, which was triggered by the subprime credit in the United States, is probably the most severe crisis for the last century. It has affected many countries in the world including Indonesia. In spite of worsening financial market in recent months, Indonesia has a great potency to be a hub for international Islamic finance. This paper attempts to analyze Indonesia’s Islamic Stock Market, namely Jakarta Islamic Index (JII), in relation with other Islamic as well as conventional stock markets in Malaysia and the United States, especially during the subprime crisis which started in early 2006. This research uses daily closing data of stock price indices obtained from Bloomberg database from January 1, 2006 until December 31, 2008. It employs time series analysis of cointegration and impulse response function. The results show that there is no long run relationship between Indonesia’s capital market and both Malaysia and the US markets. For investors, the results will give them choices for their investment portfolio. Meanwhile, in Indonesia’s perspective, this should be an opportunity for promoting its capital market as the potential destination for profitable investment. In the short run, the JII is significantly affected by the shock or disturbance taking place in the other markets. However, the results also indicate that the JII is the least volatile and more stable market."
5.3.11
Islamic Hedging: Gambling or Risk Management?
Saadiah Mohamad, Universiti Teknologi MARA, Malaysia
Ali Tabatabaei, Universiti Teknologi MARA (UiTM)
August 2008
Abstract: "Although there is a lack of consensus regarding derivatives and the development of sharia-compliant funds to mimic hedge funds in order to tap the global surplus liquidity especially the Gulf petrodollar, sharia scholars are generally agreeable that hedging is permissible and necessary as a risk management tool. However, there is still considerable debate regarding the kind of instruments that could be sharia-compliant. This paper looks at the main forms of hedging and examines the debate surrounding the use of derivatives in Islamic financial markets. The paper then looks at alternatives for sharia-compliant hedging mechanisms and in particular examines an Islamic financial derivative of Bai Salam that can mimic a short sale in a conventional option, but with potential for becoming a more superior risk management tool."
2.3.11
Central banking and monetary management in islamic financial environment
Hanif, M. Nadim and Sheikh, Salman
July 2010
Abstract: "Continuous growth in Islamic finance calls for studying the framework in which the monetary policy maker (i.e., central bank) performs its functions. Central banks in Muslim countries are using various instruments for monetary policy purpose including interest rate. As a result, Islamic financial institutions (IFIs) are facing issues in benchmarking the price of financial instruments. Acceptable solution to benchmarking lies in the presence of a real economic activity in the base of any proposal and its feasibility for business performance when put against conventional banking. This paper presents empirical evidence of statistical equivalence of nominal GDP growth rate and official interest rate for ‘advanced,’ ‘all,’ and some Muslim countries. We propose nominal GDP growth rate as benchmark for pricing domestic financial transactions of IFIs as well as for pricing external bilateral/ multilateral loans. The paper also suggests nominal income targeting as monetary policy regime and provides a liquidity management mechanism for banking system in Islamic financial environment."
27.2.11
Are Islamic Investment Certificates Special? Evidence on the Post-Announcement Performance of Sukuk Issues
Christophe J. Godlewski, University of Strasbourg, LaRGE Research Center; EM Strasbourg Business School
Rima Turk Ariss, Lebanese American University
Laurent Weill, Université Robert Schuman Strasbourg III; University of Strasbourg - LaRGE Research Center (Laboratoire de Recherche en Gestion et Economie)
April 2010
Abstract: "The last decade has witnessed rapid expansion of Islamic financial instruments, notably with the proliferation of Islamic investment certificates called Sukuk. Sukuk generally represent the Islamic financial instrument equivalent to conventional bonds. We evaluate the economic differences between these financing techniques and appraise the implications on the future expansion of Sukuk. We use a market-based approach to investigate whether investors react differently to the announcements of issues of Sukuk and conventional bonds. We find that the stock market is neutral to the announcement of conventional bonds, but we observe a significant negative stock market reaction to the announcement of Sukuk. We explain this different stock market reaction using the adverse selection mechanism, which favors Sukuk issuance by lower-quality debtor companies. Unlike arguments presented in prior literature, our results support the view that differences exist between Sukuk and conventional bonds because the market is able to distinguish among these securities."
24.2.11
The Deloitte Islamic Finance leaders survey in the Middle East
Benchmarking Practices
Biannual Survey - 2010
Deloitte’s Islamic Finance Knowledge Center
"In order to best serve the interests of its clients and the Islamic Finance practice generally, the Deloitte’s Islamic Finance Knowledge Center (Deloitte ME IFKC) seeks to implement an evidence-based approach to the evolution of Islamic Finance Thought Leadership (IFTL).
This is the first Deloitte Islamic Finance leaders survey in a biannual series targeted at industry practitioners and leaders of Islamic Financial Institutions (IFIs) in the Middle East. The survey is based on interviews conducted with industry leaders between April and June 2010.
In general, this report is designed to provide industry stakeholders-regulators, standard-setters, Islamic financial institutions (IFI), investors, and practitioners with a portrayal of the trends and issues prevailing in the current economic environment."
21.2.11
The Economics of Islamic Finance and Securitization
The Economics of Islamic Finance and SecuritizationAndreas A. Jobst
International Monetary Fund (IMF) - Monetary and Capital Markets Department (MCM)
Journal of Structured Finance, Vol. 13, No. 1
February 2007
Abstract: Islamic lending transactions are governed by the precepts of the shariah, which bans interest and stipulates that income must be derived as return from entrepreneurial investment. Since Islamic finance is predicated on asset backing and specific credit participation in identified business risk, structuring shariah-compliant securitization seems straightforward. This paper explains the fundamental legal principles of Islamic finance, which includes the presentation of a valuation model that helps distil the essential economic characteristics of shariah-compliant synthetication of conventional finance. In addition to a brief review of the current state of market development, the examination of pertinent legal and economic implications of shariah compliance on the configuration of securitization transactions informs a discussion of the most salient benefits and drawbacks of Islamic securitization.
20.2.11
Voices of the Unheard - Salvaging the Next Generation of Islamic Bankers
Islamic Business & Finance Magazine
By Mohammed Khnifer (MSc,MBA,CIFP)
The silent generation of unemployed Islamic financiers. The Author warns the Islamic finance industry that it is about to lose its second generation of bankers.
19.2.11
AIMS - Job Opportunities in Islamic Banking & Finance
AIMS - Academy for International Modern Studies
February 2011
This is a periodic compilation of job postings and openings from a multitude of sources (all relevant to Islamic banking & finance), which can be found on the AIMS website. Hoping to highlight other similar sources in the future and feedback in this regard is also very welcome.
16.2.11
Sector Report: Islamic Finance
Global Finance
By Anita Hawser
February 2011
"The growing popularity of Islamic financing and an intensified focus on risk management in the global banking industry are prompting greater awareness of the need for a unified—and appropriate—regulatory regime."
14.2.11
The Small World of Islamic Finance
Shariah Scholars and Governance - A Network Analytic Perspective
Murat Ünal
Funds@Work
January 2011
This report raises a variety of questions relating to governance of Islamic Financial Institutions (pages 28 - 31) and some of them echo similar queries raised in an earlier editorial of Opalesque Islamic Finance Intelligence (see reference link).
11.2.11
ISRA Journal - Volume 2
Volume 2, Issue 2
December 2010
Volume 2 of the ISRA journal is now available online, you can find the table of contents here and download individual articles directly from their site, these include:
Academic Articles:
Juristic Analysis of the Profit Distribution Method
New Musharakah Model in Managing Islamic Investment
An Overview of Shari'ah Issues Regarding the Application of the Islamic Letter of Credit Practice in Malaysia
Case Studies of the Practice of Nomination and Hibah by Malaysian Takaful Operators
An Empirical Investigation into SMEs’ Perceptions of Credit Guarantee Corporation (CGC) Malaysia Berhad: A Case Study of the Islamic Guarantee Scheme in Malaysia
Practitioner's Articles:
Islamic Liquidity Management – The Malaysian Experience
Research Notes:
Shari'ah Parameters of Hiyal in Islamic Finance
Analytical Study of the Interaction Between Fatawa, Shari'ah Rulings, Resolutions and Conventional Laws in Contemporary Islamic Finance in Malaysia with Cross Reference to the Practices in Saudi Arabia, Pakistan and the Sudan
Capital Requirements and Banking Behaviour for Islamic Banks
8.2.11
Islamic Banking Windows - By Justice Mohammed Taqi Usmani
New Horizon Magazine, Issue No. 119
Justice Mohammed Taqi Usmani
May 2002
"It is well settled that the emergence of a full competitive market is always useful for the strength of an industry. There is no reason why Islamic banks should be an exception to this rule. If these windows perform well, it will persuade Islamic banks to perform better and if their performance is poor, they will never be able to stand before the Islamic banks as hard competitors."
6.2.11
The Impact of AAOIFI Standards and Other Bank Characteristics on the Level of Voluntary Disclosure in the Annual Reports of Islamic Banks
Doctoral thesis, University of Surrey
Al-Baluchi, Ahmed Ebrahim (2006)
4.2.11
IFRS vs AAOIFI: The Clash of Standards?
Mohamed Ibrahim, Shahul Hameed
Published in: International Accountant
March 2007
Abstract: “The Islamic financial industry needs a corresponding alternative set of accounting standards which can at best be harmonized, not standardized due to the different nature and activities of the Islamic banks and financial institutions. These standards already exist, developed by an industry led non profit organization based in Bahrain- the Accounting and Auditing Organization for Islamic Financial Institutions established in 1991. The IASB should reconsider its position and allow alternatives- live and let live, just as there is a need for differential reporting requirements for small and medium businesses.”
30.1.11
New kid in the block: QScience Journal of Contemporary Islamic Studies
An interdisciplinary journal covering the following major themes in Islamic studies: Contemporary Islamic jurisprudence; Islamic history and civilization; Comparative religions and modern Islamic thought; Islamic economics and finance, Public policy in Islam. A Qatar Foundation Academic Journal.
Their first editorial article can be viewed here:
Islamic finance: some aspects of the research and policy nexus
Tariqullah Khan
December 2010
Abstract: "Islamic finance is a dynamic, practical and academic field of contemporary Islamic studies. It is based on the universally shared ethical values of transparency, fairness and justice and operates in conformity with the Shariah in the framework of laws existing in a jurisdiction. During the past 35 years Islamic finance has emerged as a way of financing production, projects and trade and facilitating the required financial intermediation and payments systems. The recent global financial crisis has increased interests in the Islamic finance business model. The focus has been on the products offered by Islamic finance, its architectural foundations, the unique risks of its assets and liabilities and its implications for the inclusiveness and stability of the interconnected financial systems. In the coming years we expect that these interest areas will remain in focus of the academic and policy research works in the field of Islamic finance. This note intends to highlight some of the pertinent themes in the research and policy nexus related to Islamic finance."
When Sukuk Default - Asset Priority of Certificate-holders vis a vis Creditors
Opalesque Islamic Finance Intelligence
By Mohammed Khnifer (MSc,MBA,CIFP)
The research explains how lawyers can structure sukuk that can save certificate-holders from the repercussions of what comes after default. That is Asset Protection of Certificate-holders vis a vis Creditors.
22.1.11
Opalesque Islamic Finance Intelligence - Fifteenth Issue
Our Editorial tackles the approach we take not only to define Islamic finance but, increasingly, on how we communicate it to others. On the other end our Featured Resource is a short compilation of materials concerning Islamic Economics, an often distant topic to Islamic finance but one that is undergoing a similar revival and evolution.
The Featured Structure segment has Jhordy Kashoogie analyzing the debate behind the permissibility of trading sukuk, and this is further complemented by the Discussion Board which brings along feedback from practitioners on the same subject. Lex Islamicus welcomes back Hakimah Yacoob as she discusses financial criminology and financial victimology from the perspective of Islamic finance.
The Industry Snapshot introduces a recurring series of articles on EPL in Islamic finance (Education, Perception and Liquidity), which has been developed by Deloitte's Daud Vicary. Lastly the Opinion Column examines the growing concerns regarding career development and deployment of human capital in the industry, with Mohammed Khnifer highlighting some of the main obstacles faced by today's would-be Islamic bankers.
We encourage feedback from our readers and welcome comments & suggestions to make OIFI better. In addition, please remember that you can visit our historical archive (see reference link) for access to our ever-growing databank of Opalesque Islamic Finance Briefing as well as all of the back issues of Opalesque Islamic Finance Intelligence.
Download the complete issue of Opalesque Islamic Finance Intelligence here.
Alternatively you can read each article separately in the OIFI Archive:
Editor’s Note: Islamic Finance Incommunicado
Featured Resource: Islamic Economics
Featured Structure: Shari'a Polemics of Sukuk Trading
Discussion Board: Sukuk Trading - Deviation Between Theory and Practice?
Lex Islamicus: Financial Criminology v Financial Victimology in Islamic Practice
Industry Snapshot: E.P.L. in Islamic Finance - Education
Opinion Column: Voices of the Unheard - Salvaging the Next Generation of Islamic Bankers
20.1.11
The World Interfaith Harmony Week
The World Interfaith Harmony Week is based on the United Nations General Assembly Resolution A/65/PV.34 for a worldwide week of interfaith harmony. It was proposed in 2010 by HM King Abdullah II and HRH Prince Ghazi bin Muhammad of Jordan. The World Interfaith Harmony Week will fall on the first week of February of every year and aims to promote harmony between all people regardless of their faith.
This week of observance might go unnoticed by the Islamic finance industry (letters of support come from all corners of the world, but few if any Islamic banks seemed to be aware of it), however we do hope that this same industry can serve as an example of how people from various faiths, backgrounds and nationalities can find a common ground. Read more about the World Interfaith Harmony Week on their official website (see reference link).
17.1.11
The FTSE Global Islamic and the Risk Dilemma
The FTSE Global Islamic and the Risk DilemmaNoor Hashim
American International University-Bangladesh, Office of Research and Publications
March 2008
Abstract: "Risk typically represents investments’ double-edged sword. Quantifying the adequate amount of risk to be assumed could be difficult, especially when “too much risk could turn out to be too little.” Under Islamic finance, managing risk is even more challenging. On the one hand, assuming high levels of risk is not encouraged. On the other, Islamic screening rules restrict investment and consequently stimulate risk. This paper considers the above dilemma by examining the effect of adopting screening rules on stock indices risk. The study, conducted using monthly data from FTSE Global Islamic, tests the hypothesis that the Islamic index yields adequate returns for the level of risk undertaken. Results show that the Islamic index surpasses the socially responsible index in performance while operating in line with the market. This risk assessment result does not resolve the dilemma but assures the economic appropriateness of the procedures adopted in managing the Islamic index."
14.1.11
Analysis of Short-Term Asset Concentration in Islamic Banking
Analysis of Short-Term Asset Concentration in Islamic BankingAbbas Mirakhor
International Monetary Fund (IMF)
October 1987
Abstract: In general the process of implementation of Islamic banking in the Islamic Republic of Iran and Pakistan appears to be proceeding with relative success. However, number of problems have surfaced during the transition period, among which is a tendency for short-term assets to dominate commercial bank portfolios. The negative effects on capital formation is one result of this portfolio behavior. The cause of this behavior is a set of regulations constraining profit-sharing activities of commercial banks. It is shown here that such regulations rather than reducing the risks of bankruptcies in the banking system may well increase them.
11.1.11
Financial Intermediation in Muslim Community - Issues & Problems
Financial Intermediation in Muslim Community - Issues & ProblemsIbrahim S. Alomar
Department of Economics, Qassim University, Saudi Arabia
2005
Abstract: "It is widely known that Muslim society inherited an interest based financial intermediation system from others instead of developing their own banking system. However, Muslim Economists and scholars around the world made efforts to have and develop their own financial intermediation since there was no initial working model to act upon, except the belief that interest-based financial intermediation might be replaced by an Islamic one on the basis of profit and loss sharing. During the last four decades, Islamic financial intermediation industry became a reality that the Muslim society around the world can see and practice. However, the Islamic financial intermediation in the world has been facing numerous problems & challenges. It raises a number of issues and potential problems which can be seen from the macro and micro operational point of view. Developing the Islamic financial intermediation depends on clarifying these issues and presenting them in order to focus on them studying and remedying. This paper aims to cover the ground of issues of Islamic financial intermediation that rose during its short age. Such issues prevent Islamic financial intermediation from its operating with its full efficiency level. Even no attempt to remedy these issues, presenting these issues and problems and classifying them according to their type is very valuable for sustained growth and development of the Islamic financial intermediation. Such work is a valuable contribution to build the Islamic financial intermediation industry on sound theoretical foundations."
10.1.11
The Rise and Fall of Gulf Finance House
Islamic Finance News
By Mohammed Khnifer (MSc,MBA,CIFP)
This paper dissects the balance sheet and business model of Gulf Finance, and scrutinizes the existence of a "pre-exit premium" in their activities - on top of the usual exit fees and/or performance fees. The study suggests that this practice (uncommon even for conventional Private Equity businesses - much less for an Islamic Private Equity house) was pioneered by GFH and it is this same practice that brought them down to their knees.
7.1.11
How it all started: "Birth of the blog"
We hope that the interview provides insights on how the blog has developed, but most of all on the need to better disseminate information about Islamic finance and reduce the time/costs associated with searching for relevant industry information.
Many thanks to Rushdi Siddiqui for knocking on the IFR door!
6.1.11
Corporate Governance of Islamic Banks, Its Characteristics and Effects on Stakeholders and the Role of Islamic Banks Supervisors
Doctoral thesis, University of Surrey
Al-Sadah, Anwar Khalifa Ibrahim (2007)
30.12.10
Monetary Operations and Government Debt Management Under Islamic Banking
Monetary Operations and Government Debt Management Under Islamic BankingV. Sundararajan, David Marston, Ghiath Shabsigh
International Monetary Fund (IMF)
September 1998
Abstract: This paper outlines the recent progress in developing Islamic financial instruments for the management of monetary policy and public borrowing requirements and provides details on new instruments currently being developed in the Islamic Republic of Iran and Sudan. The paper also touches on the institutional arrangements for interbank market operations and the design of effective central bank credit facilities that are needed under Islamic banking to support the development and operation of these new instruments.
28.12.10
Hedging in Islamic Finance
Hedging in Islamic Finance IRTI Occasional Papers
Sami Ibrahim Al-Suwailem
2006
Abstract: "The last decade witnessed an increasing trend in markets’ volatilities and financial crises. During the same period, derivatives, the most common instruments for hedging, have been growing at an exponential rate. Apparently, derivatives did not help stabilize markets and attenuate financial crises. This is not difficult to explain, since derivatives are also the main instruments for speculation. More than 97% of derivatives users are speculators, while less than 3% are hedgers. The challenge therefore is to search for instruments that allow for productive risk management without harmful speculation. This is the theme of Islamic finance that the paper explores. Based on Shari’ah rules of gharar, the paper therefore suggests several instruments for managing and hedging risks associated with Islamic modes of finance."
20.12.10
Managing Prudentially the Shariah compliance risk - Organized Tawarruq as an example
Opalesque Islamic Finance Intelligence
By Mohammed Khnifer (MSc,MBA,CIFP)
A novel research that deals with Maslaha (public interest) and the Permissibility of Organized Tawarruq. It also shed light on the Shariah Governance issue and the Shariah Risk. It is a “must” read for any Shariah Risk officer.
16.12.10
Opalesque Islamic Finance Intelligence XIV
Mohammed Khnifer takes on our Featured Structure section with an extensive analysis on the implementation of Islamic deposit insurance, with particular attention given to Malaysia's IDI framework. This is promptly followed by Lex Islamicus where ISRA'a Hakimah Yaacob provides a fresh approach to the standardisation debate, including novel references to international conventions for the harmonisation of private law and coordination of civil and commercial matters.
The Industry Snapshot welcomes back Mobasher Zein as he continues his analysis of an Islamic commodity-backed currency with further attention given to the monetary framework that would be required to make this happen. Last but certainly not least Toby Birch shares his views on our Opinion Column with regards to the underserved retail market in Islamic finance and what are some of the obstacles that need to be addressed in coming years.
Always glad to hear from our readers and welcoming all comments & suggestions and please remember that you can visit our online archive (see reference link) for access to our ever-growing databank of Opalesque Islamic Finance Briefing as well as all of the back issues of Opalesque Islamic Finance Intelligence.
Download the complete issue of Opalesque Islamic Finance Intelligence here.
Alternatively you can read each article separately in the OIFI Archive:
Editor’s Note: AAOIFI's Perestroika
Featured Resource: Linkedin Discussions - Highlights of 2010
Featured Structure: Towards a Universal Islamic Deposit Insurance System
Lex Islamicus: Standardisation v Harmonisation: Towards Recognition?
Industry Snapshot: Islamic Dinar Revisited
Opinion Column: Ready for Retail?
ICM Quarterly Bulletin - September 2010
Securities Commission Malaysia
September 2010 Vol. 5 No. 3
The latest issue of the Malaysian ICM quarterly bulletin is here, published by the Securities Commission Malaysia (SC). Among the featured content you will find a couple of interesting articles, one on the ethics of disagreements and another on the concept of paying for a promise to buy/lease an asset (hamish jiddiyyah) in the context of an ijarah contract. This and previous issues of the bulletin are available on their online archive here.
10.12.10
Islamic Project Finance in The Kingdom of Saudi Arabia
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Islamic Project Finance in The Kingdom of Saudi ArabiaCraig Nethercott and Mohammed Al Sheikh – White & Case llp
Hissam Kamal and Sheikha Al Sudairy – HSBC Saudi Arabia Limited
July 2006
"...there was a common scepticism as to whether the products applied in Qatar, Oman and elsewhere in the Gulf could be used in Saudi Arabia. The full spectrum of Islamic financing products is commonly utilised in Saudi Arabia (mostly in retail banking), but never before had an Islamic financing product been used in a multi-sourced financing."
8.12.10
Rural Finance and Farmers' Indebtedness: A Study of Two Punjabs
Rural Finance and Farmers' Indebtedness: A Study of Two PunjabsSingh, Lakhwinder (October 2008)
Punjabi University
Abstract: "Economic development theory has recognized that access to finance enables economic agents of production to exploit growth opportunities. The governments of less developed countries since world war two have been striving hard to enacting suitable policies to enable rural households in accessing timely credit. This has led to a rise in the agricultural production and productivity. The pattern of economic transformation followed by less developed countries, which has squeezed agriculture sector surpluses without reducing the burden of population dependent in such economic activities. Consequently, the borrowing generally in such kind of economic transformation process becomes burden some. The modern development process in both the rural economies of Indian and Pakistani Punjab could also not able to replace the older money-lending system, which remained excessively exploitative. This process of financing rural economic activities can be called as double squeezing of agricultural households. An attempt has been made here to examine the growth, structure and deficiencies in the rural financial systems of two Punjabs during the period 1975-76 to 2003-04. Some suggestions related to public policy for providing timely and adequate credit have also been made."
6.12.10
Islamic Finance: A Therapy for Healing the Global Financial Crisis
Islamic Finance: A Therapy for Healing the Global Financial CrisisMiranti Kartika Dewi, Faculty of Economics, University of Indonesia
Ilham Reza Ferdian, International Islamic University Malaysia
Abstract: "Global financial crisis which hit many too-big-too-fail countries and financial institution in the world was mainly made happen by debt securitization. Derivative instruments resulted from this process obviously were not backed by real asset. When any party came up with investment on these instruments, the investment would never support the development of real sector economy, instead, it just worsen the situation by creating bubble economic. This condition becomes more harmful when the securitized debts default. This practice is strictly forbidden according to Islamic finance principles. It has inherent risk management tools to prevent the crisis. This paper attempts to examine the root of the financial crisis and find the solution from Islamic finance principles."
Sukuk- Building for a Solid Future
Islamic Banking & Finance magazine
Final verdict: East Cameron sukuk holders win their case
Asset-based and asset-backed sukuk are contrasting instruments with different consequences in the event of default, as Mohammed Khnifer explains in his analysis of distressed high-profile sukuk and the judgement on East Cameron Gas. Also under the microscope is bankruptcy remoteness in sukuk issuance.
4.12.10
Creating an Effective and Efficient Regulatory Framework for the Islamic Capital Market
Creating an Effective and Efficient Regulatory Framework for the Islamic Capital Marketby Dr Wan Nursofiza Wan Azmi
KLBS - Working Paper Series 010
2007
2.12.10
Islamic Microfinance: A New Approach to Help Small Enterprises
Islamic Microfinance: A New Approach to Help Small EnterprisesABAC Malaysia
August 2008
"It is estimated that about 35% of the world’s 1.2 billion Muslims are poor, thus creating a large market for microfinance. However, there are very few Islamic MFIs and Islamic banks involved in microfinance. Many MFIs are operating under the conventional system, while Islamic banks tend to favor larger firms."
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