New, updated Islamic Finance Feed bringing together Islamic banking events, links, resources and research from the International Journal of Islamic and Middle Eastern Finance and Management, along with blog and twitter references. http://pipes.yahoo.com/pipes/pipe.info?_id=COPsvctB3RGogQpPEpPZnA Thu, 01 Oct 2015 22:50:03 +0000 http://pipes.yahoo.com/pipes/ http://feedproxy.google.com/~r/InternationalJournalOfIslamicAndMiddleEasternFinanceAndManagement/~3/I6wkPanIT4w/journals.htm <strong>Abstract</strong><br /><br />Not available. literatinetwork@emeraldinsight.com (M. Kabir Hassan) Mon, 11 Aug 2014 23:00:00 +0000 Article http://feedproxy.google.com/~r/InternationalJournalOfIslamicAndMiddleEasternFinanceAndManagement/~3/Aaoo4yfSiwA/journals.htm <strong>Abstract</strong><br /><br /><b>Purpose</b> - The purpose of this research is to highlight the possibility of structuring an Islamic option which includes an element of risk sharing as opposed to risk transfer.<b>Design/methodology/approach</b> - The approach adopted in this research involved a combination of a wa’ad (promise) and murabaha (cost plus sale) and examining if they could form a risk sharing Islamic option. The payoffs were assumed to be dependant of bi-period outcomes.<b>Findings</b> - The paper attempted to create a hybrid risk-sharing option by combining elements of both wa’ad (promise) and murabaha (cost plus sale). The results yielded are dependent upon the eventual direction of the market (in-the-money, at-the-money and out-the-money). Whilst the results are not definitive, they do provide arguments for the adoption of a risk-sharing, as opposed to a risk transfer, methodology when it comes to structuring risk management instruments.<b>Research limitations/implications</b> - One of the major limitations of this research is the inability to assess the Shariah-compliancy of the proposed instrument. Shariah-compliancy is determined by a Shariah Supervisory Board and every effort has been made to ensure that Shariah financial principles are adhered to in the creation of this structure.<b>Practical implications</b> - the structure provides some interest arguments in the creation of risk management tools under a Shariah-financial framework. The structure illustrates the benefits of having a risk-sharing modus over the conventional risk-transfer stances of most risk management tools.<b>Originality/value</b> - The paper offers a new way of structuring a risk management tool in Islamic finance. It explores the highly debated area of derivatives in Islamic finance and proposes a new way of creating a risk management tool that involves some elements of risk-sharing literatinetwork@emeraldinsight.com (Seng Kiong Kok, Gianluigi Giorgioni, Jason Laws) Mon, 11 Aug 2014 23:00:00 +0000 Article http://feedproxy.google.com/~r/InternationalJournalOfIslamicAndMiddleEasternFinanceAndManagement/~3/z6sSWb4DefI/journals.htm <strong>Abstract</strong><br /><br /><b>Purpose</b> - The purpose of this paper is to document performance of analysts’ recommendations in the MENA region during the period between 1999 and 2010.<b>Design/methodology/approach</b> - This paper uses post-announcement market adjusted returns as a measure of performance and computes returns for different holding periods. Significant positive (negative) returns following buy (sell) recommendation will indicate value relevance of these recommendations.<b>Findings</b> - We show that analysts’ buy recommendations have significant information in them, while their sell recommendations contain no significant information. We report significant positive returns following analysts’ buy recommendations and insignificant returns following their sell recommendations. Furthermore, we also show that our results hold true only in markets where institutions are relatively strong (common law countries and countries with stronger property rights) and for firms which have lower agency conflicts (firms that pay dividends and have concentrated ownership). For markets where institutions are relatively weak and for firms which have greater agency conflicts, our results show no value in analysts’ recommendations.<b>Practical implications</b> - Our results imply that investors should not blindly follow analyst recommendations while making their investment decisions in the MENA region. <b>Originality/value</b> - This paper makes detailed analysis of analyst recommendations in previously unexplored MENA region. We also identify some conditions under which analyst recommendation have no value and some conditions under which they have partial value. literatinetwork@emeraldinsight.com (Omar Farooq, Latifa Id Ali) Mon, 11 Aug 2014 23:00:00 +0000 Article http://feedproxy.google.com/~r/InternationalJournalOfIslamicAndMiddleEasternFinanceAndManagement/~3/Sm_VTaSb1-w/journals.htm <strong>Abstract</strong><br /><br /><b>Purpose</b> - The purpose of this study is to we examine the impact of the Muslim religion on firm capital structure. <b>Design/methodology/approach</b> - The authors compare financing patterns in Muslim versus non-Muslim countries using of 658 firms in 16 countries covering a period of seven years. <b>Findings</b> - No significant differences between Muslim and non-Muslim countries were found in terms of total debt ratios. However, significant differences were found in the choice of short-term versus long-term debt, with firms in Muslim countries showing a strong preference for short-term debt.<b>Research limitations/implications</b> - The findings confirm existing theories on the impact of the Islamic religion on short-term versus long term debt preferences. However, the findings concerning the lack of an impact of the Islamic religion on total debt preferences is surprising and contrary to existing theories<b>Practical implications</b> - Firms in Muslim countries appear to have the flexibility to adopt overall leverage ratios comparable to those in non-Muslim countries. However, firms in Muslim countries may be disadvantaged in that there appear to be impediments to the use of long-term debt. <b>Originality/value</b> - This paper presents one of the first empirical studies of the impact of the Muslim religion on corporate financing choices across a large cross-section of firms in Muslim and non-Muslim countries. literatinetwork@emeraldinsight.com (Theresa Gunn, Joshua Shackman) Mon, 11 Aug 2014 23:00:00 +0000 Article http://feedproxy.google.com/~r/InternationalJournalOfIslamicAndMiddleEasternFinanceAndManagement/~3/FlzlbeTUVpk/journals.htm <strong>Abstract</strong><br /><br /><b>Purpose</b> - The main objectives of this study are to determine the level of perception of a Muslim account holder’s in a conventional bank toward Islamic banking products and 2) To determine the relationship between the perception levels of Nigerian’s account holder’s and their decision to patronize an Islamic banking. Personal perception factor is operationalised as opinion or observations, which are able to influence customer’s decision to patronize Islamic banking products and services.<b>Design/methodology/approach</b> - A field survey was conducted and samples drawn using proportionate stratified simple random sampling techniques. Out of the 500 questionnaires distributed by hand delivery, only 304 were returned and 286 were usable for our data analysis using SPSS and PLS Modelling Software<b>Findings</b> - The findings are: first, the means for personal perception variable was 4.91 with standard deviation of 1.007. This indicates the good perception level of Islamic products by Muslim account holders in a conventional bank in Kano Nigeria. The respondents’ level of decision to patronize the Islamic banking products and services was satisfactory. Second, the results also, showed that the research framework model, structural model and hypothesis were supported. In the measurement model, the convergent, discriminant validity and reliability/composite reliability of the perception construct were assessed favourably. The results revealed that perception was positively associated with Muslim account holder’s decision to patronize Islamic banking products<b>Research limitations/implications</b> - The study is subject to several shortcomings that limit interpretation of findings. One of the limitations of this study, is the use of cross-sectional design for survey research, and subjective self reported perceptual measures in assessing the studies. Hence, the findings of this study cannot be generalized in a larger context across the cultures of other countries.<b>Practical implications</b> - The implication of this study is for the Islamic banking industry to focus on the people’s level of perception, government support, quality and availability of Islamic banking products and services that would have an impact on customer decision to patronize Islamic banking products. The necessary suggestions on new area of research were recommended for future researchers.<b>Originality/value</b> - The results of the present study establish the major problem that requires urgent attention needed to strengthen public education towards the distinctive characteristics of Islamic banks and how it may profitably suit the interest of customers in their financial dealings. literatinetwork@emeraldinsight.com (kabiru Jinjiri Ringim) Mon, 11 Aug 2014 23:00:00 +0000 Article http://feedproxy.google.com/~r/InternationalJournalOfIslamicAndMiddleEasternFinanceAndManagement/~3/DKjXzNM_zgE/journals.htm <strong>Abstract</strong><br /><br /><b>Purpose</b> - (i) to assess the impact of zakat fund on the food expenditure of the households (ii) to assess the impact of zakat fund on the agricultural production of the households (iii) to assess the opinion of the zakat-recipients on food security status under zakat program <b>Design/methodology/approach</b> - Samples were selected for this study using simple random sampling (SRS) technique. A total of 149 households were selected from the 196 households. Survey was conducted during January to March 2011 among the project beneficiaries using questionnaire. OLS technique was used to assess the impact of zakat on food security status of the zakat- recipients. Heteroscedasticity problem was detected in this study which was corrected using white method. Logit model was used in order to assess the opinions of the zakat recipients on their food security status under Hasana project. <b>Findings</b> - This study shows that amount of zakat provided to the poor recipients failed to create any significant influence on their agricultural production, food expenditure, and food security status. The study also shows that household income, family members’ involvement in agricultural activities and numbers of IGAs pursued by the households were the key determinants of households’ food consumption. <b>Originality/value</b> - This study helps in assessing the opinion of the zakat recipients about the effectiveness of zakat program on their living-standard in terms of household agricultural production and food security and also assisting in policy planing for alleviating rural poverty in Bangladesh through zakat system. literatinetwork@emeraldinsight.com (Tanvir Mahmud, M Kabir Hassan, Md. Ferdous Alam, Kazi Sohag, Farhana Rafiq) Mon, 11 Aug 2014 23:00:00 +0000 Article http://feedproxy.google.com/~r/InternationalJournalOfIslamicAndMiddleEasternFinanceAndManagement/~3/m1XlXhUZa-Q/journals.htm <strong>Abstract</strong><br /><br /><b>Purpose</b> - The purpose of this paper is to understand the current governance practices and governance structure of Islamic banks in GCC countries and Southeast Asia countries with the purpose of providing relevant information in guiding the future development of the governance system for Islamic banks. As well, the paper discusses and compares the state of the governance system in GCC countries (Kuwait, Bahrain, United Arab Emirates, Qatar and Saudi Arabia) and Southeast Asia countries (Malaysia and Indonesia). <b>Design/methodology/approach</b> - The study utilizes descriptive analysis approach in extracting and analyzing data collected for 83 Islamic banks observed for the period 2002-2011. We test for differences in means and median of corporate governance attributes between a sample of Islamic banks in GCC countries and another one for Southeast Asia countries. We use selected variables of corporate governance of different governance structures namely: the ownership structure, the board of directors, the Shariah board and the CEO attributes.<b>Findings</b> - The paper findings argue that there are significant differences and divergence of corporate governance structure of Islamic banks in GCC countries and those in Southeast Asia countries. This position acknowledges that there are shortcomings to the existing governance framework for Islamic banks which needs further improvement and standardization. <b>Practical implications</b> - The paper is a very useful source of information that may provide relevant guidelines in guiding the future development of corporate governance of Islamic banks. As well, the paper provides relevant guidelines for improving regulations and laws covering the governance of Islamic banks. <b>Originality/value</b> - This paper provides fresh data and recent information on the actual corporate governance system in Islamic banks in GCC and Southeast Asia countries. As well, the paper discusses a significant shortage in corporate governance literature of Islamic finance. literatinetwork@emeraldinsight.com (rihab grassa, Hamadi Matoussi) Mon, 11 Aug 2014 23:00:00 +0000 Article http://feedproxy.google.com/~r/InternationalJournalOfIslamicAndMiddleEasternFinanceAndManagement/~3/HGb5yxI4RbY/journals.htm <strong>Abstract</strong><br /><br /><b>Purpose</b> - Which of the banking stream is relatively more profitable in MENA region?<b>Design/methodology/approach</b> - The empirical study covers a sample of 15 conventional and 15 Islamic banks for the period 2002-2009. We estimate models using Generalized Method of Moments in system (GMM in system) of Blundell and Bond (1998). We exploit an up-to-date econometric technique which takes into consideration the issue of endogeneity of regressors to evaluate the comparative profitability of Islamic and conventional banks in Middle Eastern and North Africa (MENA) region.<b>Findings</b> - Empirical analysis results show that the determinants’ significance varies between Islamic and conventional banks. Profitability seems to be quite persistent in MENA region reflecting a higher degree of government intervention and may signals barriers to competition.<b>Originality/value</b> - The main interest is to develop a comprehensive model that integrates macroeconomic determinants, industry specific determinants, and bank-specific determinants. The paper makes comparison of the performance between two different banking systems in MENA region. We consider a variable crisis in order to gain additional insights into the impacts of the financial crisis on MENA banking sector. literatinetwork@emeraldinsight.com (Rim Ben Selma Mokni, Houssem Rachdi) Wed, 23 Jul 2014 23:00:00 +0000 Article