INCEIF Knowledge Repository (INCEIF University)
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Oversubscription of MIB shares while HDFC issues third corporate sukuk
No full textMaldives Islamic Bank (MIB) has announced that its IPO of shares was successfully oversubscribed. A total of 6.98 million shares - 31% of the total number of shares - were open for the public and the price per share was MVR35 (US15.61 million). At the moment, the board of MIB is enacting a regulation to distribute shares to shareholders in a fair manner, giving preference to retail investors in accordance to what was mentioned in the prospectus
Blockchain and its Shariah compliant structure
No full textIslamic finance has gained momentum in the world today. Irrespective of faith conviction, it has been accepted as a mode of financing in the world. The development of Islamic finance was gradual in the past. At the initial stage of its development, Islamic finance was concerned more with Shariah compliance of transactions and contracts used in it. Subsequently, focus was realigned on Shariah harmonisation with respect to juristic views and Shariah governance. Islamic finance encompasses some fundamental religious prohibitions and the promotion of certain virtues enshrined in Islam, to be observed in all ramifications of business dealings, including services provision. Therefore, Islamic finance works in line with Islamic religious principles such as a ban on usury or interest, gambling, uncertainty and outright speculations
Financial exclusion in Kabul, Afghanistan: why people refuse or unable to use the banking system
No full textThe first objective of this study aims to investigate the current status of financial inclusion and the second research objective aims to study the determinants of populations' refusal or inability to participate in banking system. The qualitative approach is used for the first research objective whereas quantitative technique is used to address the second objective. For the purpose of quantitative approach, primary data was collected through survey questionnaires from financially excluded population (individuals without a bank account or having only salary account) in Kabul province to answer the hypotheses outlined for this study. The data was analyzed using Structural Equation Modeling to determine the factors that contributed to financial exclusion ..
Capital structure and Shari'ah compliance firms: Malaysian evidence
No full textIn the literature of corporate finance, there exists alongside others, an age long inquiry into the behaviour and determinants of corporate capital structure. The study into capital structure behaviour was pioneered by Modigliani and Miller (1958, 1963) and which is still widely research today. Despite years of research, much are still unknown to us, which determinants are reliable explanator of capital structure variations across firms and time. In 1984, Stewart C. Myers officially introduced the "Capital Structure Puzzle" in his American Finance Association Presidential Speech. The capital structure puzzle at its heart asks the question of how do firms decide and manage their capital structure
Managing displaced commercial risk in selected GCC Islamic banks: an empirical test for robustness
No full textProfit sharing investment accounts (PSIAs) are unique and foundational to Islamic banking. PSIAs are a hybrid between current accounts (unstable sources of funding due to withdrawal risk) on one extreme, and partnership (stable sources of funding due to risk taking nature) on the other extreme. In the literature, considerable interest has been attached to this nature of the PSIAs in the capital structure of Islamic banks, specially, with respect to its implications for banking stability and regulatory capital assessment. Recognising the hybrid nature of the PSIAs, the Islamic Financial Services Board (IFSB) introduced two formulas addressing the inherent risk in the full range of the hybrid nature of PSIAs. The standard formula treats the PSIAs as partnership and risk taking. The supervisory discretionary formula treats the PSIAs as deposits tempting to migrate between banks seeking higher rate of returns. If depositors have to migrate, shareholders have to face the migratory depositors' risk displaced on their responsibility. In quantitative terms how much this displaced commercial risk will be in a particular Islamic bank? The measure is known as the Alpha factor in the second IFSB formula. In this paper we empirically address the robustness of the Alpha factor in the selected GCC Islamic banks. We show that the regulatory practice in this regard needs improvement on credibility. If Islamic banking has to make a difference in the global scene, the management of PSIAs requires a deep rooted reform. We set the pillars of such a reform that policy makers may find useful in supporting the promotion of genuine Islamic banking
Shariah view on consumption tax: Malaysian GST and SST as case studies
No full textA consumption tax is a levy on the purchase of goods and services made by consumers as a source of revenues for the governments. This research aims at investigating the Shariah point of view on the compatibility of imposing a consumption tax like the GST and SST on goods and services purchased by consumers. The research used a qualitative method and relied on Islamic primary, secondary sources, relevant laws of Malaysia and other relevant materials. The findings of the research showed that tax is permissible with conditions, but consumption tax is not encouraged in Islam, whether on goods and service bought by the end-users except if the government is compelled by necessity to resort to it
The role of sharing economy towards sustainable development of Malaysia
No full textThe sharing economy is a new uprising economic system that is built upon the sharing of assets via digital platforms to create economic value through maximizing utilisation of resources between individuals, businesses and government. Perceived as a strong advocate for sustainability, the sharing economy has contributed to a profound shift in global consumer consumption behaviour. Positive to its potential to be utilised as driver for sustainable development, this paper aims to uncover the role of sharing economy towards sustainable development of Malaysia. The study employed three qualitative research methods, namely phenomenography, semi-structured interview and content analysis. The results shows that the sharing economy has an immense potential to be utilised as a part of sustainable development plan, especially in realising five Sustainable Development Goals (SDGs), namely Goal 1: No Poverty, Goal 8: Decent Work and Economic Growth, Goal 9: Resilient Industry, Innovation and Infrastructure, Goal 11: Sustainable Cities and Community and Goal 12: Responsible Consumption and Production ..
An empirical study of the challenges facing zakat and waqf institutions in Northern Nigeria
No full textThe purpose of this paper is to unearth the factors inhibiting the development of zakat (the Islamic obligatory alms) and waqf (endowment) institutions in Northern Nigeria, with the aim of proffering appropriate solutions. This paper uses a qualitative research methodology whereby data was sourced from relevant stakeholders in Northern Nigeria. To select the appropriate interviewees, maximum variation and homogenous purposeful sampling techniques were used. The findings of the paper show that zakat and waqf institutions in Northern Nigeria have not achieved their inherent Shari'ah objectives because members of the public have little or no trust or confidence in the institutions. Also, the potential zakat payers and waqf donors dislike political office holders' involvement in the appointment of the institutions' administrators. Finally, the administrators lack adequate managerial and administrative knowledge of the two institutions. The current research focuses on causes of low performance of zakat and waqf institutions solely in Northern Nigeria. It is envisaged that subsequent researchers may conduct research on the possibility of having a federal law that will strengthen the overall establishment and development of zakat and waqf in Nigeria. This will affect both Muslim-majority and Muslim-minority communities. This paper represents a referenceable work in the field of zakat and waqf in Northern Nigeria, as it uses an approach that sources primary data in the form of participants' point of view instead of relying on literature or document analysis. It is not a mere theoretical study of the literature but an empirical investigation of the problem
Social impact models for education: a Malaysian case study
No full textMalaysia has achieved access to over 90% ofschooling children and allocates a bulk of their budget to education yet the results and performance of students overall are still below average. In-depth interviews and desktop research were carried.out to understand the various issues the education system faces, focusing on the schooling, higher education and lifelong learning segments. Education is also a sector focus under social impact investment and models. Worldwide and locally, these have delivered various solutions to contribute to solving educational issues. These are explored and in light of the findings, a business model canvas of a school learning app is proposed as an additional social impact model that can address some of the issues revealed
Structural changes, competition and bank stability in Malaysia's dual banking system
No full textThis paper assesses Malaysia's competition landscape and its risk implications subsequent to conventional banking consolidation and Islamic banking penetration in the aftermath of the 1997/1998 Asian financial crisis. Employing a panel sample of conventional and Islamic commercial banks, it arrives at the following conclusions. First, the consolidation exercise, which has led to a significant reduction in the number of domestic commercial banks, has not stifled banking competition. Second, the paper provides empirical support for the competition-stability relationship, particularly for the conventional banking sector. Islamic banking sector risk appears to be neutral to market competition or market power, although there is limited evidence that it increases with overall market concentration. Finally, the analysis uncovers the risk-increasing effect of the Islamic banking market structure on the conventional banking sector. By contrast, conventional banking market concentration tends to reduce the credit risk of Islamic bank