The main aim of the study is to provide an index for the Islamic banking industry through which the performance of the Islamic banks can be gauged on the maq asid al-Sharı‘ah. Accordingly,we suggest an index for the Islamic banking industry based on the maq asid al-Sharı‘ah through which...

Since its inception, Islamic banking in Pakistan has shown remarkable growth and development. Most recent statistics unveil that industry has captured around 13% of the total banking market in Pakistan. This outstanding augmentation of the industry highlights the crucial role of Islamic banks...

There is growing recent interest about the effect that local culture, social values and norms, derived from religion have on corporate risk taking. The growing literature on this topic has provided evidence of the effect of religious adherence in reducing risk taking. However, the effect of...

We document that a firm's culture — specifically, its religiosity — affects its cost of debt. Firms in higher-religiosity counties have higher credit ratings and lower debt costs. The impact of religiosity is stronger for firms with greater information asymmetry and during recessions....

This paper evaluates and compares the performance of Sharia-compliant banks with their conventional counterparts operating in Pakistan. Data of five full-fledged Islamic banks and fifteen conventional banks, all from Pakistan, have been used for the study. Study period comprises of six years...

The shifting paradigm of the primary Islamic Banking product in America, the Shariah-compliant home financing product, has fallen into a developmental conundrum. In an attempt to capture a larger segment, current Shariah-compliant schemes evolved to that which are void of Islamic attributes,...

Islamic teachings are strictly against Riba (i.e. interest) because it involves exploitation. At present, Islamic banks, which claim to be interest-free financial institutions, are facing severe criticism for using Islamic tags for the similar products and services offered by the conventional...

We perform principal component analysis (PCA) on an array of 20 financial ratios to explore and compare conventional and Islamic banks' financial characteristics. In contrast to the existing literature, this is the first study to use PCA to derive four components to examine the financial...

We use a classic Merton credit risk framework to argue that Islamic Banking Institutions (IBIs) face less incentive to take on risks than Conventional Banking Institutions (CBI). IBIs have less incentive for risk shifting both in and outside of distress situations. We test and confirm this...

The discipline of Islamic economics emerged making a claim of providing a viable alternative to the then prevailing social orders; namely capitalism and socialism. However, both ideological as well as empirical development of this discipline has made it clear that it seeks its foundation in...