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Islamic banks: history, stability and lessons from cooperative banking

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dc.contributor.authorRosana Gulzar
dc.contributor.authorMohamed Ariff Abdul Kareem
dc.contributor.authorMansor H. Ibrahim
dc.date.accessioned2021-08-06T08:05:46Z
dc.date.available2021-08-06T08:05:46Z
dc.date.issued2021
dc.description.abstractIslamic banking's profit-maximising fervour, building upon the use of interest-resembling products, has raised concerns about its Shariah authenticity and financial stability. While early Islamic economists envisioned an industry built on values of mutuality and participation, architects of Islamic banking have chosen to replicate interest-based conventional banking for the purpose of fast growth. This study has two objectives. First, to narrate the history of Islamic banking, from the theories postulated to the beginnings of the industry. This builds an understanding of why 'Islamic' banking operates as it does currently, which has implications for Shariah compliance and financial stability. It is suggested that the mimicking of conventional banks may cause instability since unlike commercial banks, 'Islamic' banks face Shariah constraints. This leads to the second objective, which is to analyse the cooperative banking model, which has been described as the closest theoretical model to Islamic banking. Specifically, this study focuses on the model in Europe which, despite its challenges, has managed to silence critics in the way it contributes to communal welfare and financial stability, especially during credit crunches when commercial banks are known to retreat from markets. This first study of a functioning cooperative banking model, in the context of Islamic banking, may thus offer lessons for Islamic banking reform.en_US
dc.identifier.citationGulzar, R., Ibrahim, M. H., & Abdul Kareem, M. A. (2021). Islamic banks: history, stability and lessons from cooperative banking. Institutions and Economies, 13 (3), pp. 1-26.en_US
dc.identifier.doihttps://doi.org/10.22452/IJIE.vol13no3.1
dc.identifier.issn2232-1349 (e-ISSN)
dc.identifier.urihttps://ikr.inceif.org/handle/INCEIF/3409
dc.languageEnglish
dc.language.isoengen_US
dc.publisherFaculty of Economics and Administration, University of Malayaen_US
dc.rights2021. Faculty of Economics and Administration, University of Malaya
dc.sourceSEDONA
dc.subjectIslamicen_US
dc.subjectCommercialen_US
dc.subjectCooperativeen_US
dc.subjectBankingen_US
dc.subjectStabilityen_US
dc.titleIslamic banks: history, stability and lessons from cooperative bankingen_US
dc.typeJournal Articleen_US
dlc.maintopicIslamic bankingen_US
dspace.entity.typePublication
ikr.doctypeScholarly Works
ikr.topic.maintopicIslamic bankingen_US
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