Modern Islamic Banking

The world financial markets continue to scrutinise the fundamental pillars of global and domestic banks due to the perpetual changing of the international economic and political landscape. The global financial crisis of 2008 has brought about two major important effects. First, the crisis has led to banks questioning their methodology in evaluating assets and the process of mapping and measuring various types of risks. Second, it has brought to the fore sectors that have withstood the adverse impact of the crisis relatively better than the less fortunate ones. Islamic finance therefore, despite its infancy as compared to its conventional counterpart, is one such industry that has globally captivated the attention of financial experts and industry players. The global Islamic finance industry has evidently been in an upward trajectory, demonstrated by its assets’ steady double-digit compound annual growth rate of 16% over the past six years (World Islamic Banking Competitiveness Report 2016). The industry’s assets are estimated to be about USD 2 trillion (IFSB Financial Stability Report 2016)....