Islamic banks have proliferated and emerged as important players in the global banking industry especially in the Muslim-Majority countries. The recent increase in the number and market share of Islamic banks has intensified the competition in this new industry. Despite its importance, the increasing competition in Islamic banking market not only from its own Islamic peers, but also from commercial banks has not been adequately addressed nor its consequences have been investigated. This summary aims to shed the light the market structure and the evolution of the competition under dual banking system.

Despite the global upward trend of the Islamic fintech industry, the size of the Islamic fintech offering is still embryonic in the West African Economic and Monetary Union (WAEMU) region considering the number of Islamic fintech providers. However, the growth potential of Islamic Fintech in the WAEMU member countries is real in light of (i) the high percentage of Muslim population in the region, (ii) the ongoing initiatives of the decision makers, intended to improve and finetune the Islamic banking regulation and financial inclusion, (iii) willingness of the regulator to establish an efficient regulatory framework for fintech to address customer's expectations/needs and (iv) the positive impact of framework for conventional fintech on Islamic one, notably in terms of infrastructure and regulation. As part of its initiatives to promote financial innovations and inclusion, the Central Bank of the West African States (BCEAO) has implemented some initiatives aiming at promoting the harmonious development of fintech industry in WAEMU. However, considering the achievements observed so far from the relevant policy makers, it is appropriate to examine whether the initiatives involve Shariah compliant fintech or not, before addressing potential Shariah governance issues of fintech. Despite the encouraging improvement of the financial inclusion, most of the population does not have access to the basic financial services, such as payment, transfer money, etc. As of today, the use of digital financial services has become the most appropriate way to serve the populations excluded from the traditional financials services, considered as challenging and unaffordable by the poor population, either because of onerous conditions (high lending rate), limited offers or religious believes (prohibition to be funded as per the conventional financing products).

As the Fintech evolution transforms the banking sectors worldwide, the players in the market are hard-pressed to experiment the tremendous opportunities that the application of the likes of Blockchain, Big Data and Artificial Intelligence et cetera would have on the financial world. As the volume of the data continue to expand, the possibilities that this raw data materializes in the form of opportunities lean towards limitless. Organizations such as financial institutions must be vigilant of the prospects that such data can reveal and the extend of leverage that they can exercise to build insights for their consumers, products, and services. Big data analytics have alone become the driving force for digital innovations and transformation of banks.

The aim of this paper is to evaluate the various existing models of waqf in practice and determine their applicability within the context of Malaysia. This study was undertaken to investigate the practicality, feasibility, and potential success of implementing a centralized database for the administration of waqf. The research process involved extensive desktop research and thorough benchmarking analyses. Additionally, the study delved into the identification of obstacles and challenges. To provide comprehensive insights, case studies were meticulously compared and contrasted. The findings of this study indicate that the establishment of a centralized national Waqf database would significantly enhance the efficiency and effectiveness of Waqf operations and administration. Furthermore, it would contribute to the enhancement of integrity and transparency within the system. Following this line of thought, the adoption of such a system aligns with the principles of maqasid al-Shariah, ultimately safeguarding the reputation of Islam.

Despite being a dynamic hub for the Islamic financial products and services, Malaysia's Islamic fintech landscape does not meet expectations. With a number of challenges such as stringent regulations, lack of adequate funding, shortage of a skilled workforce, fierce conventional competitors etc. the future growth and progress might only remain an unfulfilled dream if they are not addressed timely. This paper is aimed at critically discussing these challenges faced by such companies. Also it aims at proposing potential measures to overcome the highlighted issues. But in order to validate the mentioned challenges and the potential remedies, an interview based approach is employed. The top and middle management of five full-fledged Islamic fintech companies were interviewed with the aim of ensuring whether the mentioned challenges actually exist or not. And whether the proposed solutions are practicable. Based on the findings from the interviews, it is observed that almost all the mentioned challenges are recognized by the companies. Although not all were in consensus regarding every issue, but in general they saw the challenges as legitimate. The proposed solutions were also well received and recognized as beneficial for the companies. Another finding from the interviews was additional challenges the companies saw as worrisome, such as lack of awareness and technological ignorance among the masses. The paper concludes with the recommendation for the relevant authorities to address the highlighted issues with seriousness. Further research may be carried out to provide solutions for the additional issues pointed out by the companies.

As the Islamic finance industry continues to gain popularity in the financial sphere, the number of faithful investors who are interested in Shari'ah-compliant avenues for their investments also continues to increase. One of the most important of these is the equity market. However, it is evident in today's world that it is hard to find a joint stock company whose activities are completely compliant to Shari'ah principles and rulings. As a share of a company represents all the activities and underlying assets of the company, the Shari'ah noncompliance issue can emerge in the share. While the primary activities of a company are Shari'ah-compliant, its peripheral activities may be impermissible from the Shari'ah viewpoint. Meanwhile, the assets of the company can also be in the form of cash, debt, goods, usufruct or rights, which can raise the issue of trading ribawi (interest-based) items. Thus, the study addresses the issue of Shari'ah compliance and tradability of shares that represent a mixture of halal (permissible in Islamic law) and haram (impermissible in Islamic law) activities and assets.

Shari'ah has specific rules for dealing in each class of assets and activities; i.e., cash, debt, goods, usufruct, and those classified as either halal (permissible) or haram (impermissible). These rulings can be easily applied when such an asset or activity is an independent subject matter of a transaction. However, the issue becomes complicated when an asset or activity is mixed with others and the combination is represented as a single subject matter. A fine example of this situation is shares of a joint stock company. A company share represents all the activities and underlying assets of that company. Some of the activities and assets of that company may be Shari'ah non-compliant while some may be Shari'ah compliant. Such assets can be in any form; i.e., cash, debt, goods, usufruct or rights. There are two main issues that need to be dealt with in considering a company's shares: (1) when it represents a mixture of halal and haram activities and assets, and (2) when it represents a mixture of ribawi and non-ribawi assets.

The Global Risk Report (2021) identifies ESG risks as the number one risk faced by the global economy. Banks have contributed to this risk and can also contribute to mitigating it. High exposure of Banks to ESG risks will contribute to climate disaster, which in turn will have financial risk implications for banks in the form of disaster events risks and energy transition risks. Depositors can discipline banks in reducing and preferably eliminating their ESG risks through enforcing market discipline by deposit withdrawal. This thesis investigates the extent to which deposit withdrawal works as market discipline against ESG risks in the banks of the OIC region. The thesis also examines the impact of financial risk represented by CAMELS variables on depositors' behavior. The generalized method of moments (System GMM estimator) is used for dynamic panel data models, as well as a sample from 65 countries over the period 2007 to 2016. Our findings indicate that depositors react significantly to environmental and governance risks while depositors' discipline does not exist with social risks. With regard to financial risks, our findings suggest weak evidence of market discipline. However, regressing CAMELS components separately provides better results and understanding than regressing CAMELS components collectively. In the OIC region, the study indicates that depositors tend to be sensitive to changes in capital adequacy, bank earnings and ESG risks, while in the non-OIC region, depositors are only sensitive to management quality.

This thesis investigates the determinants and impact of short-term capital flow in the 33 OIC countries from 2000 to 2018 and bridges the understanding between both literature strands. The short-term capital flows are divided into gross inflows, outflows, and extreme episodes, analyzed under the push-pull framework. The empirical approaches for exploring the determinants of short-term capital flows consist of panel static and dynamic LSDV and probit models. Additional analysis controlling for Lucas's paradox conditions provides more insights and robustness. The study then analyzes their impact on economic growth (GDP), conventional, and Islamic stock markets. The study employs time-series models (ARDL and NADRL) to test the impact of short-term capital flows on economic growth and stock markets. The models establish the long-term dynamic relationship and synergize with prior findings on the heterogeneous responses of each country. The findings suggest that short-term capital flows into the OIC countries are tied to the global commodity and domestic consumption effects, indicating the dominance effect from push factors and the global economic cycle. Regional contagion act as a transmission mechanism of episodic flows across the OIC. There is also clear evidence of each country's heterogeneous determinants and impact of short-term capital flows, emphasizing the important roles of pull factors and the level of capital account openness. The impact of STC flows on stock markets confirms that they are susceptible to global economies and uncertainty, especially in conventional stock markets. The findings for Islamic stock markets support the "decoupling hypothesis" since they are less affected by global shocks from higher risks and uncertainty. The overall findings imply the importance of capital liberalization, institutional quality, and the optimal sequence of capital liberalization.

This paper examines the effectiveness of the bank lending channel in a dual banking system in Malaysia, where both conventional and Islamic banks operate alongside each other. It also investigates the impact of bank competition on lending channels in financial systems. Using panel data from both Islamic and conventional banks in Malaysia, our findings indicate the ineffectiveness of the bank lending channel. Further, the empirical results suggest that the impact of monetary policy on bank lending does not depend on bank competition. In other words, the effectiveness of the lending transmission channel does not depend on the market power of the individual banks. Furthermore, the effectiveness of the lending channel appears to be independent of whether the bank is Islamic or conventional. This result is probably explained by the fact that the vast majority of Islamic banks in Malaysia are subsidiaries of conventional banks. Policymakers therefore do not need to differentiate between conventional and Islamic banks in regard to the effectiveness of the bank lending channel.

This research endeavour aims to foster collaboration among beneficiaries, donors, and waqf managers (mutawalli) by deeply understanding the prevailing legislative framework. Employing a concept-driven qualitative methodology, we conducted content analysis through a deductive approach. The investigation employed three key attributes, namely "use more, donate more, and share more," to systematically explore the ramifications of established concepts in a broader context. Focus Group Discussions (FGDs) were conducted, and subsequently, the transcribed text from these FGDs underwent meticulous analysis. The study culminates in the proposition that beneficiaries, donors, and mutawalli can synchronize their efforts through the waqf project by: 1) opting for increased utilization when the waqf project offers goods and services either free of charge or at a more affordable rate compared to the prevailing market prices; 2) contributing higher donations through various means such as cash, deductions from salaries, electronic payments, or in-kind contributions; and 3) enhancing information dissemination by utilizing platforms such as social media (WhatsApp, Facebook, YouTube, TikTok, etc.), mass media (television and radio), roadshows, interpersonal communication, and various online channels to propagate the cause. The initiative for synergy examines the applicability of the "benefidonors" term within the present context. The findings demonstrate that the concept of Benefidonors can indeed facilitate the collaborative sharing of information, thereby amplifying waqf contributions from beneficiaries, donors, and mutawalli. As a culmination of the study, a refined Benefidonors model is delineated, providing a comprehensive framework for effective collaboration.

The novel COVID-19 pandemic has caused an unprecedented human crisis around the globe. The necessary actions implemented to contain the virus have sparked both economic and social downturn. It shows the fragility and unpreparedness of the economy to face such a pandemic. Significant weakening of economic conditions has escalated the pressure on households, businesses and financial markets. Governments all over the globe are in the process of formulating and implementing appropriate policies to continue economic activities amidst this turmoil. Financial institutions are obligated to respond towards the policies adopted by respective governments.

The spotlight of this study is to examine whether environmental, social, and governance performance affects the financial performance of microfinance institutions (MFIs). The topic has been of much interest to researchers and policymakers due to increased awareness among stakeholders on the adverse social and environmental impacts of business actions. Using a dataset covering 5 years for 62 MFIs across 34 countries, we find that environmental and governance performance has no impact on the financial performance of MFIs. As for the social-financial performance nexus, our results reveal a positive relationship using the depth of outreach as proxy of social performance. However, when women empowerment is used as a proxy for social performance, evidence suggest presence of negative relationship. The study contributes to the literature by providing new evidence on the relationship between environmental, social, and governance and financial performance from microfinance industry. Our results are robust to a variety of econometric specifications and have significant policy implications for donors, investors, MFIs, and regulators.

Islamic banking industry has unprecedentedly witnessed a rapid growth since its inception four decades back in the late 1970s. However, the prospect of this flourishing industry is fast becoming gloomy in recent years. The growth of Islamic banking almost matches the conventional banking, and their products are hardly distinguishable. Although the market growth slows down in the aftermath of the global financial crises in 2008, the Islamic banking market has witnessed increasing competition. Islamic banks become more competitive and they managed to increase their market share meanwhile, conventional banks have successfully responded to the challenge by launching Islamic windows and subsidiaries. The increasing competition is considered as one of the main challenges that face Islamic banks, specifically, their performance.

Islamic banks have proliferated and emerged as important players in the global banking industry especially in the Muslim-majority countries. The recent increase in the number and market share of Islamic banks has intensified the competition in this new industry. Despite its importance, the increasing competition in Islamic banking market not only from its own Islamic peers, but also from commercial banks has not been adequately addressed nor its consequences have been investigated. This thesis aims to shed the light on this important issue by investigating the effect of competition on the efficiency of both Islamic and conventional banks. Employing one-step stochastic frontier approach and a bank-level data set of 263 banks from 10 countries over the period 2001-2014, we find that both competition-inefficiency and the quiet life hypotheses work simultaneously. The basic finding supports competition-inefficiency hypothesis where the increasing competition in the banking market leads to decreases in the cost efficiency. Further investigation of the non-linear impact shows an evidence of quiet life hypothesis. Additionally, the negative effects of competition on cost efficiency is almost counterbalanced in highly concentrated markets. Interestingly, the findings show that the positive impact of concentration on efficiency is higher for Islamic banks compared to conventional banks, and the quiet life hypothesis is less probable to exist in Islamic banks due to their distinct business model and corporate governance. The findings of this thesis draw important policy implications. Regarding pro-competitive policies, regulators in low and moderate concentrated market face a trade-off between social welfare and cost efficiency. In contrast, adopting pro-competitive policies in highly concentrated markets will generate social welfare without harming banks efficiency. For full-fledged Islamic banks, in order to survive the intense competition, they may look for strategic mergers to benefit from economic of scale. Alternatively, Islamic banks may adopt a product differentiation strategy by creating and emphasizing the ethical values in their products which are in line with the ultimate Shariah objectives

This study seeks to examine whether corporate environmental performance (CEP) and corporate social performance (CSP) affect stability of the banking industry. The topic is of much interest to researchers and policy makers considering the growing demand to integrate environmental and social practices into banking business model. Based on a panel dataset of 473 banks in 74 countries, this research finds that CEP is negatively related to bank stability as measured by non-performing loans (NPL). However, the impact is insignificant for small and large banks, as well as for banks in countries with low environmental scores. Furthermore, CSP does not appear to have a significant relationship with bank stability, but financial product safety, which is an aspect of CSP, does. The results are robust to a variety of econometric specifications and have significant policy implications for investors, bankers and regulators.

The focus of this study was to establish the impact at which economic growth and digitalization independently affect the profitability and the credit risks of commercial banks, and furthermore to assess whether Islamic banks or conventional banks are more impacted with each aspect. I employed an unbalanced panel data consisting of 139 commercial banks, both Islamic and conventional banks. The period covered by the study spanned for 14 years between 2001 to 2014 and incorporated banks for 9 out of the 10 countries that are pioneers in Islamic banking with 95% of all the Islamic bank estimated the panel data using dynamic panel models employing. Generalized methods of moments (GMM). I find that economic growth impacts the profitability of commercial banks negatively and Islamic banks are significantly less impacted in this regard and likewise economic growth exhibited a positive relationship with the credit risk of Islamic banks more than that of conventional banks. With regards to digitalization, I found it to be surprisingly inversely related to both profitability and credit risks of commercial banks with Islamic banks facing more impact of the same. The results presented in the study have significant policy implications to academicians, policymakers, international bodies as well as governments.

This study assesses the role of gold, crude oil and cryptocurrency as a safe haven for traditional, sustainable, and Islamic investors during the COVID-19 pandemic crisis. Using Wavelet coherence analysis and spillover index methodologies in bivariate and multivariate settings, this study examines the correlation of these assets for different investment horizons. The findings suggest that gold, oil and bitcoin exhibited low coherency with each stock index across almost all considered investment horizons until the onset of the COVID-19. Conversely, with the outbreak of the pandemic, the return spillover is more intense across financial assets, and a significant pairwise return connectedness between each equity index and hedging asset is observed. Hence, gold, oil, and bitcoin do not exhibit safe-haven characteristics. However, by decomposing the time-varying co-movements into different investment horizons, we find that total and pairwise connectedness among the assets are primarily driven by a higher-frequency band (up to 4 days). It indicates that investors have diversification opportunities with gold, oil, and bitcoin at longer horizons. The results are robust over different types of equity investors (traditional, sustainable, and Islamic) and various investment horizons.

The Islamic banking sector has ascended to be systematically important in several OIC countries particularly in Malaysia and the GCC. Globally, the sector has recorded a double digit growth rate far exceeding the growth rate of its conventional counterpart. Its sustained growth in the provision of financial services founded on Islamic principles even during crisis episodes, especially duting the recent global financial crisis, makes Islamic banking gain traction even in the non-Muslim world. Over recent years, it has made its presence in such countries as Switzerland, the UK, and the USA.

The interest in developing Islamic fintech in Malaysia and the efforts in achieving it are constantly on the rise. Several startups have launched Shariah-compliant fintech solutions. Shariah advisory boards at regulatory and industry levels have discussed various Shariah issues related to fintech. Resolutions and exposure drafts have been issued or modified by regulators to cover a wide range of Islamic fintech activities. Some government agencies have established dedicated departments to support fintech and the Islamic digital economy. Universities and training centres have started offering specialized courses and programmes to provide the requisite human capital, while research centres have invested in substantial efforts to push the industry forward by conducting extensive research and providing consultancy services. This report documents a representative sample of such efforts.

The emergence of COVID-19 in late 2019 rapidly shattered the Asia-Pacific region (APR), a bastion of economic dynamism, and it became the epicenter of the global health crisis. This unprecedented pandemic not only triggered a public health catastrophe but also unleashed a financial storm, exposing vulnerability within the region's interconnected economies. This study identifies the factors driving volatility spillovers within Asian-Pacific financial markets during the initial wave of the COVID-19 pandemic (January 2020-February 2021). We analyze the interplay of pandemic transmission dynamics, government interventions, central bank policies, and socioeconomic variables. Our findings reveal a robust and persistent association between the rising number of COVID-19 cases per million and volatility spillovers. We introduce three novel determinants - the number of intensive care unit beds, population density, and the proportion of the elderly population - which significantly impact volatility transmission in response to new cases. Stringent government measures, such as travel bans and lockdowns, mitigate volatility spillovers. Conversely, central bank policies increase volatility spillovers. These insights contribute to a deeper understanding of financial market dynamics in the context of global health emergencies. This knowledge equips policy makers in the APR with valuable tools for navigating future crises.