Evaluating Murabaha in Islamic Banks

Mansour, Israa; Sa'adeh, Yousef

doi:10.31686/ijier.vol4.iss7.573

Cited by 3 publications

(3 citation statements)

References 0 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…The results found that IBs indices generally outperform in developed markets but underperform in emerging markets.Elgadi, Entissar, M. (2016) investigated the interrelationship between performance, measures and determinants of SudaneseIBs (2005IBs ( -2013. The estimated results of the model prove that PLS role of Modaraba and Mosharaka have a significant positive impact on profitability Mansour, I. and Sa'adeh, Y. (2016).…”

mentioning

confidence: 68%

Why do Islamic Banks Concentrating Finance in Murabaha Mode? Performance and Risk Analysis (Sudan: 1997-2018)

Mustafa¹

2020

IBR

View full text Add to dashboard Cite

During 1997-2018, Islamic Banks (IBs) in Sudan provided finance by Murabaha mode to their clients with more than 45% on average. This position raises questions of why do IBs concentrating finance in Murabaha Mode rather than other modes? is this concentration implying risk and does it have influence on the financial performance of IBs? This study aimed to discusses the reasons and answer these questions. Nonperforming loan(NPL), Murabaha to gross finance, Musharaka to gross finance, Mudabaha to gross finance and Salam to gross finance were used to indicate the credit risk. Return on Equity (ROE) was used to indicate the financial performance of IBs. Ordinary least squares technique was employed to determine the trend of relations between the variables. The main results of the study show that there is an important positive relationship between the NPL and provision finance by both Murabaha and Mudaraba modes. Whereas were a negative with both Musharaka and Salam. Moreover, it’s found that there is strong negative relationship between NPL and ROE. The main reason for the expansion granting finance by Murabaha mode is that IBs are heavy rely on collaterals and in case of clients’ failure to pay, they sell collaterals to keep their financial performance safety. The study strongly recommends IBs importance of diversify the granting finance among Islamic modes of finance to avoiding the risk of concentration the finance by Murabaha mode. Furthermore, monetary authority in Sudan need to keep IBs aware with the risk associated with Islamic modes, especially Murabaha.

show abstract

mentioning

confidence: 68%

Why do Islamic Banks Concentrating Finance in Murabaha Mode? Performance and Risk Analysis (Sudan: 1997-2018)

Mustafa¹

2020

IBR

View full text Add to dashboard Cite

show abstract

“…On the other hand, the Muslim community also has serious concerns regarding the practices of Murabaha financing as they think there is no difference exist between conventional and Islamic financing as the study by Mansour and Sa'adeh (2016) to analyze and investigate the practices of the Islamic banks with regard to the shari'a point of view. The finding suggests that practices of Murabaha financing, which is thought to be according to the Islamic financing principles, are far from Sharia complaints and principles (Mansour & Sa'adeh, 2016). So, it is crucial for all the banks who claim the There are some limitations related to the Murabaha Sukuk as in the Islamic financing\g someone cannot sell the commodity without getting the possession of a assets (Morni, 2019).…”

Section: Literature Reviewmentioning

confidence: 99%

Rulings of the London Metal Exchange in Islamic Law: An Analysis of Islamic Banking Instruments and Challenges

Alotaibi

2023

J. of Law and Sust. Develop.

View full text Add to dashboard Cite

Purpose: The Islamic banking system is recognized for its role in promoting the equal distribution of resources and its emphasis on risk management. This research paper explores the rulings of the London Metal Exchange (LME) within the framework of Islamic law. The main objective is to investigate the involvement and impact of Islamic banking in LME contracts. Methods: The study utilizes both primary data, obtained through interviews with Islamic banks and LME management, and secondary data from previous research. Results: The findings highlight the significant role of Islamic banks in facilitating LME contracts, with Murabaha, Tawarruq, Istisna, Salam, and Kafala identified as the most commonly used instruments in the GCC regions. However, Islamic banks also face challenges, including criticism from Muslim scholars regarding certain practices. Conclusion: Despite these challenges, there are several opportunities for Islamic banks to contribute to the further development of the Islamic financial system. By addressing concerns, increasing awareness, and adhering to Islamic principles, Islamic banks can play a pivotal role in shaping the future of the financial industry.

show abstract

“…Murabahah: Mansour and Sa'adeh (2016) state that in a murabahah transaction, cooperative buys the item required by the user and sells it at a profit to the user with the payment deferred to a date agreed by the parties. The payment is normally made in instalments.…”

Section: Sources and Application Of Funds (Financial Resources) In Islamic Cooperativesmentioning

confidence: 99%

Determinants of Financial Resources Mobilisation of Interest-Free Cooperative Societies in Ilorin, Kwara State, Nigeria

Jimoh

2021

ijibm

View full text Add to dashboard Cite

Interest-free Cooperative society is introduced as a mirror of conventional cooperatives though on the principle of Islamic finance, to mobilise financial resources with the aim of promoting the socio-economic welfare of their members. There is however some restriction to the quantity of savings that could be mobilized. The study therefore assessed the determinants of savings mobilization in interest-free cooperative in Ilorin Kwara State. Data were collected with the use of questionnaire which was administered on 365 members of institution-based interest-free cooperative societies in Ilorin metropolis. Kaiser-Meyer-Olkin (KMO) and Cronbach’s alpha tests were performed to establish the validity and reliability of the research instrument. Logistic regression analysis was conducted and it was found that mode of saving, credit administration, internal governance and member’s awareness have positive effect on volume of savings mobilized and the effects are significant at 5% and 1% level of significance. The study concluded that the mode of savings, credit administration, internal governance, and members awareness affect resources mobilization of Islamic cooperatives in Ilorin metropolis. Direct deduction of savings from salaries, higher level of transparency and accountability, sensitization campaign are recommended for effective and efficient financial resources mobilization in interest-free cooperative societies.

show abstract

Evaluating Murabaha in Islamic Banks

Cited by 3 publications

References 0 publications

Why do Islamic Banks Concentrating Finance in Murabaha Mode? Performance and Risk Analysis (Sudan: 1997-2018)

Why do Islamic Banks Concentrating Finance in Murabaha Mode? Performance and Risk Analysis (Sudan: 1997-2018)

Rulings of the London Metal Exchange in Islamic Law: An Analysis of Islamic Banking Instruments and Challenges

Determinants of Financial Resources Mobilisation of Interest-Free Cooperative Societies in Ilorin, Kwara State, Nigeria

Contact Info

Product

Resources

About