INCEIF Knowledge Repository (INCEIF University)
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Financing through cash-waqf: a revitalization to finance different needs
No full textRecently the revival of the institution of waqf took a movable form especially in terms of the creation of cash waqf which found its ways as one of the financial institutions financing different goods and services in the different countries. In an attempt to enrich the literature on this area, this study is an extension to the authors' work, focusing mainly on the different goods and services provided by different cash waqf schemes in Muslim and Muslim minority countries without depending on the government to provide their needs. The paper aims to discuss these issues. This study uses data collected from primary sources including text from the Hadith, while data collected from secondary sources include books, articles, journals besides web sites and e-books. The findings show the potential of cash waqf in financing not only religious areas but also financing different goods and services needed globally, such as education, health, social care and commercial activates, basic infrastructures, besides opening jobs for the majority of people. The expected outcome of this research is to open the door wider for more researchers to explore the potential of cash waqf as one of the instruments to finance all sectors in Muslim and Muslim minority countries without exhausting government budget. A revitalization of an old Islamic financial product to meet the different needs
Risk-return profiles of Shariah compliant equity and commodity portfolio
No full textSince the recent financial crises, increases in contagion and correlation between assets have reduced the possibility of minimizing risk by way of diversification. The investors are therefore, looking for alternative assets such as, commodities, Islamic portfolios, etc. However, despite the very rapid growth of Islamic finance, there has hardly been any rigorous empirical research investigating the risk-return profiles of combining commodity portfolios with Islamic equities and/or with the mainstream equities. This study is aimed at filling this gap in the finance literature ..
An insight into the differences between corporate governance of conventional banks and Islamic banks
No full textThe objective of this paper is to give a clear picture on the differences between the corporate governance principles applicable to Islamic banks and conventional banks. It is hoped that this paper would help readers to comprehend the nature of both types of corporate governance principles
Maqasid driven Islamic banking some suggested baby steps
No full textAlthough the Islamic finance and banking is going to hit the US$2 trillion mark sometime this year, there are many Muslims (academics, potential and current depositors and customers) who are sceptical about Islamic banking. Potential and current customers compare the mark ups charged by Islamic banks and whenever Islamic banking mark ups are higher than their interest-charging counterparts, they assume Islamic banking is not Islamic
Islamic capital markets and development
No full textThe question of whether capital markets (and the financial sector) are necessary for economic growth and development appeared to have been settled. However, the recent spate of financial crises and the devastating effect they have had on growth and macroeconomic stability have re-stoked questions; not so much about whether the capital markets are necessary for growth as whether they are playing the role expected of them
The concept of the time value of money: a Shari'ah viewpoint
No full textThe purpose of this study is to examine the legal authority of the time value of money in Islam and its application in contemporary Islamic finance. The study aims to establish the Islamic conceptual foundations of TVM and differentiate it from that of conventional finance particularly in relation to the concept of time preference that constitutes essential basis for TVM in conventional finance. This study undertakes a library research where the literature on Islamic jurisprudence in the area of Islamic financial transactions as well as Islamic economics, both in Arabic and English is reviewed critically to construct the conceptual framework of TVM from an Islamic perspective. The findings indicate that Islam recognizes the legitimacy of the time value of money emanating from deferral (ajal) and acceleration ('ajal) in Islamic financial transactions such as deferred sale and bilateral rebate (da' wata'ajjal) but its application must be in conformity with specific guidelines laid down by the Shari'ah to avert unfair economic effects of financial transactions such as interest (riba). The application of TVM in accordance with its fundamental rules can actually remove Riba from the economy and prevent from making of money out of money
Private placement, share prices, volume and financial crisis: an emerging market study
No full textFirms are increasingly resorting to private placements in recent years, yet there is no published study of emerging markets. There is a unique opportunity to study this behavior during a severe financial crisis, when firms resorted to private placements to recover financially distressed firms. Our analysis using data over fifteen years shows (a) a significant 2–3% positive share price reaction, affirming asymmetric information effect, (b) a significant volume activity, and (c) the price impact is different across a period of a major financial crisis. If the proceeds from placement are earmarked for investment, share price is negatively (positively) correlated during the crisis (non-crisis) periods. Our finding on regulation is inconsistent with prior reports in developed markets: this is explained by the stricter restrictions on trading of private issues in emerging market. These results provide modest new contributions to the literature on private placements
Feasibility of the application of the doctrine of judicial precedent in civil and Shariah courts
No full textThe doctrine of judicial precedent plays an empirical role in the common law system, but it only has persuasive value in European countries which are practicing the civil legal system. Moreover, it has not been recognised as having a binding force in the Islamic legal system and thus each case has to be decided based on its own merits and previous decisions were merely considered as guidance for the future decision. This position is still being maintained by some countries such as Malaysia and Saudi Arabia. In Pakistan and Nigeria, however, the doctrine of judicial precedent is followed. Due to this contradiction among the Shariah legal system in various countries, as a result, a question arises relating to the feasibility of the application of the doctrine of judicial precedent in Shariah Courts needs thorough study. Accordingly, in this paper, the factual nature of the judicial precedents in both civil and Shariah legal systems have been examined comparatively in some detail with reference to countries such as England, Malaysia, Nigeria and Pakistan. This paper points out that the doctrine of stare decisis and judicial precedent can be applied in the Shariah Courts system as guiding precedents but not as binding precedents since it is allowed in Shariah to take guidance from previous decisions and there is no express prohibition in Shariah on them
Economic development in the Middle East
No full textBy examining economic development in the aftermath of the Arab Spring, this textbook introduces undergraduate and postgraduate students to the most pressing and topical economic issues in the contemporary Middle East. Although development failures contributed to the popular discontent in much of the Arab World, this comparative study also highlights development success, especially in Turkey and the Gulf
Real options with priced regime-switching risk
No full textWe develop a model of regime-switching risk premia as well as regime-dependent factor risk premia to price real options. The model incorporates the observation that the underlying risky income streams of real options are subject to discrete shifts over time as well as random changes. The presence of discrete shifts is due to systematic and unsystematic risk associated with changes in business cycles or in economic policy regimes or events such as takeovers, major changes in business plans. We analyze the impact of regime-switching behavior on the valuation of projects and investment opportunities. We find that accounting for Markov switching risk results in a delay in the expected timing of the investment while the regime-specific factor risk premia make the possibility of a regime shift more pronounced