Edited by Mervyn K. Lewis, Mohamed Ariff and Shamsher Mohamad
Chapter 5: Towards making ‘Islamic’ banking Islamic
The Islamic Finance Industry (IFI) has made impressive progress for almost four decades, posting double-digit annual rates of growth. Such phenomenal growth for such a long period is unprecedented. The size of the industry is estimated to be over $1.3 trillion as at 2011, spread all over the globe, with around 1500 institutions in more than 40 countries. Banks incorporated as Islamic banks have out-performed conventional banks on the most commonly used performance evaluation variables, such as rates of growth of equity, deposits and assets as well as on performance ratios such as return on assets (ROA), return on equity (ROE), cost-to-income ratio and liquidity ratio (production cost efficiency is lower compared to the conventional banks). However, on one important criterion, serious doubts have been raised. That is the status of Shari’ah-compliance of the most popularly used products by Islamic financial institutions.
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.