After barely half a century of experience, Islamic banking has become established as a niche industry across the world, offering new and sophisticated financial products designed to be compliant with Islamic legal principles and common law. This comprehensive book explores the theory, principles and practices underpinning this rapidly expanding sector of banking.
Expert contributors - including eminent scholars and senior practitioners in the field - examine the roots of the principles of ethical Islamic financial transactions, which have evolved over several millennia, on issues including usury, interest rates, and financial contracting for funding enterprises, mortgages, leasing and other transactions. Regulatory and governance issues are discussed, and the practice and operation of Islamic financial institutions are explained via three distinct case studies. Importantly, the final chapter looks at what steps are being taken to provide professional accreditation to Islamic banking professional personnel, and prescribes requirements for training in this growing industry.
This rich and wide-ranging guide to the foundations and fundamental principles of this new form of ethics-based financial practice will prove a fascinating and illuminating read for regulators, practitioners, and scholars in the fields of economics, finance, money and banking.
Edited by Mohamed Ariff, Chair of Economics and Finance, Sunway University, Malaysia and Munawar Iqbal, Professor, King Abdul Aziz University, Saudi Arabia and Chief of Research, IRTI, Islamic Development Bank
Contents: Preface 1. Introduction to Islamic Financial Institutions Mohamed Ariff and Munawar Iqbal PART I: FOUNDATIONS OF ETHICAL FINANCIAL TRANSACTIONS 2. Ethics-based Financial Transactions: An Assessment of Islamic Banking Mohamed Ariff 3. Ethical Principles in Islamic Business and Banking Transactions Mervyn K. Lewis 4. Adapting Understanding of Riba to Islamic Banking: Some Developments Abdullah Saeed PART II: ISLAMIC BANKING PRINCIPLES, REGULATIONS AND GOVERNANCE 5. Development, History and Prospects of Islamic Banking Munawar Iqbal 6. Development of Legal Issues of Corporate Governance for Islamic Banking Ishaq Bhatti and Maria Bhatti 7. Corporate Governance and Islamic Banks Michael T. Skully PART III: THE PRACTICE: OPERATING ISLAMIC FINANCIAL INSTITUTIONS 8. Performance of Islamic Banks and Conventional Banks Mohamed Ariff, Mohammad K. Badar, Shamsher M. and Taufiq Hassan 9. Shari'ah-consistent Investment Vehicles in Malaysia Kabir Hassan and Eric Girard 10. Takaful Insurance: Concept, History and Development Challenges Syed Othman Alhabshi and Shaikh Hamzah Razak PART IV: A DEBATE ON THE ISSUE OF REWARD FOR PARTING WITH CAPITAL 11. Usury and its Critics: From the Middle Ages to Modernity Constant Mews and Adrian Walsh 12. Riba and Interest in Islamic Banking: An Historical Review Raquib Zaman 13. Tensions in Christian Financial Ethics: An Historical Overview Ibrahim Abraham PART V: EDUCATION AND PROFESSIONAL BANKING ACCREDITATION 14. Human Capital Development in Islamic Finance: Initiatives and Challenges Syed Hamid Aljunid Index