This research aims to compare the regulatory capital instruments for Islamic banking institutions (IBIs) - in particular the qualifying Additional Tier 1 (AT1) capital instruments - as defined by Basel III, Bank Negara Malaysia (BNM) and IFSB-15 (issued by the Islamic Financial Services Board). Principally, the research examines the Shari'ah issues, especially related to subordination, arising in equity-based contracts when used for structuring AT1 capital instruments. In particular, it examines the mudarabah sukuk issued by the Abu Dhabi Islamic Bank (ADIB) in 2012. The study finds that the most appropriate Shari'ah contract that would be suitable for structuring AT1 capital instruments would be musharakah. The present study is considered an original attempt in examining an under-researched topic relating to Basel III and its Shari'ah perspective. The study will be an important reference point to Islamic banks when structuring AT1 capital instruments.

Pada Januari 2009, Satoshi Nakamoto telah menghasilkan mata wang kripto pertama yang dikenali sebagai bitcoin. Pada peringkat awalnya, mata wang kripto ini kurang mendapat sambutan meskipun teknologi yang mendasarinya amat berinovasi dan berdaya maju. Bitcoin (menggunakan simbol BTC) ini hanya mula menarik minat pengguna selepas nilainya melonjak sebanyak 600 peratus bagi BTC1 dalam masa kurang daripada setahun; iaitu BTC1 bersamaan dengan nilai USD1,000 pada 1 Januari 2017 kepada USD7,000 pada 3 November 2017. Kejayaan besar yang dicapai bitcoin ini telah menyumbang kepada penghasilan lebih banyak mata wang kripto seumpamanya dicipta dan dilancarkan. Sehingga 7 Januari 2018, lebih daripada 1,284 mata wang kripto telah dibangunkan dan bilangan ini dijangka akan terus meningkat.

Ever since the success of GoFundMe, an American charity- or donation-based online crowdfunding launched in 2010, this platform has become popular among not-for-profit organizations to raise funds to support their social activities and projects. However, the use of this online platform within the Islamic social finance domain, particularly by the government bodies is very limited. Hence, this paper provides a case study of Asnaf Care, a charity crowdfunding platform that was launched by a state zakat authority in Malaysia, i.e., Lembaga Zakat Negeri Kedah (LZNK) to specifically assist eligible beneficiaries who are affected by the global pandemic of coronavirus (COVID-19). The case study aims to assess the effectiveness of this platform in raising funds to cushion the impact of COVID-19 on the affected zakat recipients. In this discourse, key features of Asnaf Care, its campaigns or projects, and the total collected funds since its launch in March 2020 until December 2020 are highlighted. The case study is hoped to pave the way for any zakat authorities in Malaysia or worldwide in exploring an alternative digital platform to raise additional funds during financial crises due to pandemics, calamities, or natural disasters.

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.

Wealth in the Gulf Cooperation Council (GCC) has mostly been fuelled by oil and gas revenues. These petrodollar flows have been increasing over the long term particularly with the rising oil prices. Based on average crude oil prices of USD 70 per barrel, it is estimated that the amount of oil revenue profits of the six GCC states - Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE) - will tripple over the next 14 years (Farrell, 2005). How the GCC deploys this increasing wealth is of high interest to the world. Historically, the GCC has relied on the financial markets of the United States and Europe to manage their investments.

Micro, small and medium-sized enterprises (MSMEs) play a pivotal role in driving economic growth, fostering innovation, and providing employment opportunities globally. According to the World Economic Forum (2021), MSMEs represent about 90 per cent of business establishments globally and contribute up to 70 per cent of both employment and global gross domestic product (GDP), accentuating their role as the backbone in many economies. As the global economy transitions towards more sustainable and responsible business practices, and environmental, social, and governance (ESG) factors become increasingly scrutinised, MSMEs are presented with both opportunities and challenges to align their operations with sustainability practices and ESG requirements. Yet, most of the existing sustainability assessment frameworks tend to cater for the needs of large corporations. Realising this gap, INCEIF University - in collaboration with Ficus Capital - has developed the Shari'ah-compliant ESG (ESG-i) Assessment Framework to assess sustainability practices among MSMEs in Malaysia. The ESG-i Assessment Framework serves as a starting point for MSMEs in understanding complex sustainability frameworks and taxonomies that are incongruent with their operational reality. By incorporating Shari'ah principles and embracing the Quadruple Bottom Line (QBL) concept - Planet, People, Profit, and Principle - the framework provides a comprehensive blueprint for evaluating sustainability practices among MSMEs. In contrast to the existing frameworks, the ESG-i Assessment Framework simplifies the criteria for evaluating sustainability practices among MSMEs and provides them with an assessment tool for them to comprehend and integrate into their businesses, regardless of their size and scale. The journey of developing the ESG-i Assessment Framework transcends theoretical constructs to achieve practical efficacy. The pilot phase, featuring a diverse set of MSMEs, not only demonstrates its real-world viability but also emphasises the need for a targeted approach in supporting MSMEs on their journey towards a Low Carbon, Circular and Resilient (LCCR) future. This aligns with the current strategic initiatives taken by many financial institutions and regulatory supervisory authorities driving transition finance. Building upon insights from the pilot phase and feedback from different stakeholders - regulators, practitioners, Shari'ah scholars, and academicians, the ESG-i Assessment Framework has undergone comprehensive enhancements. Aligned with the prevailing domestic ESG guidelines, taxonomies, and assessment framework (e.g., Securities Commission Malaysia (SC)'s Principles-Based Sustainable and Responsible Investment Taxonomy for the Malaysian Capital Market (SRI Taxonomy); Sustainable and Responsible Investment Sukuk Framework; Maqasid Al-Shariah Guidance Islamic Capital Market (Maqasid Guidance); Bank Negara Malaysia (BNM)'s Climate Change and Principle-Based Taxonomy (CCPT), Value-Based Intermediation (VBI); and SME Corporation Malaysia (SME Corp. Malaysia)'s PKS Lestari), as well as international sustainability assessment frameworks (e.g., B Impact Assessment by B Corporations (B Corp), ESG Score by Refinitiv, and standards issued by Global Reporting Initiative (GRI)), the ESG-i Assessment Framework provides a simplified tool developed in recognition of the reality of MSMEs' operations and capabilities. Hence, it serves as a transitional framework for them to embrace sustainability practices. It not only provides an assessment tool but also acts as a bridge to carry MSMEs through the evolving labyrinth that the global sustainability landscape represents. The ESG-i Assessment Framework beckons to be a catalyst for change and champions a more sustainable supply chain for MSMEs. The ESG-i Assessment Framework is increasingly crucial as the European Union's Carbon Border Adjustment Mechanism is set to take effect in 2024, bringing about substantial implications for the Malaysian economy, particularly impacting MSMEs, which contribute over 16 per cent to the country's exports. Economic Forum (2021). MSMEs represent about 90 percent of business establishments globally and contribute up to 70 percent of both employment and global gross domestic product (GDP), accentuating their roles as the backbone in many economies.

The financial re-engineering of old concepts is a new trend in the field of Islamic finance. It has been termed as 'New Horizon 2.0' by Shinsuke (2014) - an approach which aims to revitalize original instruments once practiced in medieval Islam to harness the potential of Islamic finance to better meet the needs of communities. It is also in line with the continuous innovative efforts of the industry to apply existing concepts, contracts, and instruments that are Shari'ah-compliant in the modern context to resolve contemporary socio-economic issues. In light of this background, this chapter examines how the age-old philanthropic concept of waqf has been integrated in the Islamic finance industry to revive its applications in contemporary societies. The chapter focuses on the inter-links between waqf and the Islamic capital market (ICM). Accordingly, it examines the new trends of waqf that have emerged in the ICM.

The launching of Malaysia's investment account platform (IAP) in 2016 marked another important milestone in positioning Malaysia as a leader in the Islamic banking industry. For the first time in Malaysian history, six competitive Islamic banks collectively collaborated to initiate and launch the IAP. The multi-bank platform offers multiple ventures or investment avenues for investors to invest in, and financing options and opportunities for ventures to choose from, via the intermediation of the sponsoring banks. The platform that leverages on the advance and innovative financial technology system, or fintech, offers a safe and regulated investment ecosystem with better outreach and enhanced visibility to the ventures while the investors enjoy a greater transparency and disclosure on the listed ventures (Investment Account Platform, 2016). The IAP has introduced a new innovative asset class into the Islamic financial market. Its introduction has developed and strengthened the Malaysian Islamic financial market by garnering investments from institutions as well as retail, which includes high net worth individual investors (Razak, 2015).

The book presents the various aspects of the theory of Islamic capital markets (ICM) and its operations by starting with the simplest ideas and moving on to the complex applied issues. The topics covered include: an overview of ICM and its development; Shari'ah principles, contracts and issues; regulatory and governance frameworks; risk management, accounting and taxation issues; details on different segments of the ICM, including sukuk, Shari'ah-compliant stocks, Islamic fund management, Islamic private equity and venture capital, Islamic derivatives and Islamic structures investment products; and future directions for the ICM.

Financial technology (fintech) refers to the application of technology-software, algorithms and even hardware-to traditional financial services to save time, optimise cost, and enhance efficiency and user experience. Fintech applications, which include digital payment, internet and mobile banking, peer-to-peer (P2P) financing, equity crowdfunding (ECF), robo-advisory, digital asset exchanges, insuretech, and e-services have provided innovative solutions to various stakeholders, either the surplus units (i.e., investors who have excess funds) or deficit units (i.e., parties who need funds). Islamic fintech, on the other hand, refers to the use of technology to deliver financial services and solutions that comply with the Shariah principles and requirements, promote the well-being of mankind, and integrate ethical elements to attain fairness and justice.

Islamic finance operates under varied legal and regulatory frameworks in various jurisdictions that reflect differing regulatory approaches to the introduction and supervision of Islamic banks. This seems logical if viewed from the perspective that the countries where Islamic banks operate are not at the same level of development; some are advanced, a few have just embarked on their journey of introducing Islamic banking and finance, while others are somewhere in the middle. Thus, one should naturally expect that reaching a certain level of consensus in regulating and supervising Islamic banks will take considerable time. The current research looks into one area of contention in Islamic banking regulation. It explores the different types of Islamic banking structures that prevail in general while it specifically evaluates subsidiary Islamic banks of conventional banks versus full-fledged Islamic banking structures. The advantages and disadvantages of both structures are discussed, followed by an evaluation of the unique challenges posed by the combination of these two in the context of Malaysia.

Islamic estate planning is an important aspect of wealth management and financial planning. Currently, Islamic estate planning, which makes up a part of Islamic financial planing, is not well-developed and needs further enhancement and improvement for it to flourish so that every Muslim can benefit from it. The important components of Islamic estate planning include hiba, wasiyya, waqf, takaful and fara'id (Islamic law of inheritance), among others. This chapter discusses some of the major issues pertaining to theses components and offers recommendations to resolve them.

Islamic banks provide similar trade finance facilities to those of conventional banks. They intermediate between buyers (i.e., importers) and sellers (i.e., exporters), act as a custodian of documents, and provide means to reduce payment risks via different payment terms (e.g., open account, documentary collection and letter of credit (LC)). They also provide financing - as need be - to help with working capital tied to the trade transactions. This research focuses only on financing by Islamic banks to importers that involve LCs. Different underlying Shari'ah contracts are used for import financing facilities under LC, the most common being the murabahah contract. At the time of sale, the existence of the subject matter and its ownership by the seller are the key requirements for the validity of a murabahah contract. In the absence of either of these requirements, the contract is considered null and void.

A near three-year protracted COVID-19 pandemic since the 2019 first outbreak in Wuhan, China, has hugely impacted all the basic economic units: the household, the firm and the government. Over the two-year period from 2 January 2020 to 15 January 2022, the following five industries: airlines; hotels, restaurants and leisure; energy equipment and services; automobiles, and specialty retail were most affected by lockdowns and social distancing intended to curtail the spread of COVID-19 (S&P Global Market Intelligence, 2022). Many of these industries are small businesses requiring a longer period to recover and return to their pre-pandemic state. One of these businesses' immediate measures was retrenching a certain percentage of employees to reduce operational costs. For the retrenched employees who need to find other sources of income to survive, the gig economy, which had gained attention after the global financial crisis in 2008, is an attractive alternative for them to earn a living. This article sheds light on the growth drivers of gig workforce after the COVID-19 pandemic and how advantageous this new economic trend is to the Islamic finance industry.

Saudi Arabia is one of the largest Islamic finance markets in the world and therefore holds a position of special importance in the study of Islamic finance as well as in the study of shari'ah governance in Islamic financial institutions (IFIs). Saudi Arabia is the largest Islamic banking market in the Gulf Cooperation Council (GCC) by market share; its Islamic banking assets accounted for 51.5 per cent of the domestic banking sector as at 2Q2017. Globally, Saudi Arabia ranked second after Iran among twelve jurisdictions where Islamic banking is systematically important. It accounted for 20.4 per cent of global Islamic banking assets in 2017 as compared to Iran, which accounted for 34.4 per cent. Even in the development of other segments of Islamic finance, Saudi Arabia holds a significant position. It ia active in the sukuk market, with its issuances - including those by the Islamic Development Bank (IsDB) - representing 33 per cent of total global issuances in 2017, thus ranking after Malaysia, which registered 38 per cent of total issuances. Saudi Arabia also accounted for 37 per cent of total Islamic funds in 2017, while 32 per cent of Islamic funds were domiciled in Malaysia. Moreover, it is the largest takaful market registering 38 per cent of global takaful contributions, followed by Iran (34 per cent), Malaysia (7 per cent) and the United Arab Emirates (6 per cent).

The sukuk market is one of the fastest growing sectors in Islamic finance, with total sukuk outstanding valued at more than USD330 billion in the first quarter of 2016. The industry has witnessed evolution in the issuance of landmark and innovative structures: ranging from plain vanilla to more complex and hybrid structures such as convertible and exchangeable sukuk that allow investors to tap into the equity of reference companies; from short- to medium- to long-term and perpetual sukuk to meet the funding requirements of issuers; and from sovereign to corporate and retail sukuk to cater to the appetites of different classes of issuers and investors. Recently, more sukuk have been structured as a subordinated instrument to meet the regulatory capital requirement of Islamic banks and as a sustainable and responsible investment (SRI) tool to promote socially responsible financing and investment. Regardless of the technical and commercial features of sukuk, all structures must comply with the Shari'ah requirements, particularly those of underlying assets that back the issuance. This article narrates the dynamics of fiqhi opinions on sukuk assets based on the historical timeline of issuance starting from the first corporate sukuk by Shell MDS Malaysia in 1990 until the current development.

Basel III has redefined the criteria for qualifying regulatory capital instruments. Banks have to maintain Common Equity Tier 1 (CET1) capital of at least 4.5% of Risk-Weighted Assets (RWA) and Tier 1 (T1) capital should be at least 6% of RWA at all times, while total capital (i.e., Tier 1 plus Tier 2) must be at least 8% of RWA at all times. T1 capital will absorb losses during going-concern - a situation where the bank is still solvent and continuing operation. Tier 2 (T2), on the other hand, refers to gone-concern capital, which will absorb further losses when the bank is facing financial distress and reaches the point of non-viability.

The global sukuk market contracted 6% y-o-y in 2022 to USD154 bil, driven mainly by a drop in sukuk issuances from key market players, more specifically the GCC and Indonesia. In the GCC region, the Ukraine conflict resulted in supply chain disruptions which resulted in higher oil prices. This led to lower funding requirements by the GCC government and consequently, smaller sovereign sukuk issuances. Inflationary pressures, rate hiking throughout the year and geopolitical tensions created an unfavourable economic environment for most of global issuers as well. Despite that, the global sukuk market fared well considering the record number of rate hikes in 2022. Malaysia and Saudi Arabia remained as the two largest sukuk issuers commanding 63% of issuances in 2022. Sovereign sukuk was the mainstay form of sukuk issuance constituting 57.3% of the total. Corporate sukuk issuances staged a comeback in 4Q 2022, largely contributed by Malaysian corporates, after consecutive quarters of decline demonstrating promising signs of recovery going into 2023 as rates are expected to stabilise. The green and sustainability sukuk market experienced a new high of US$8.1 bil issuances in 2022 (2021: US$6 bil, unlike the wider global sukuk market). Demand was driven mainly by investors with ESG-centric investment mandates. This trend is expected to continue into 2023 as the current supply of ESG shariah-compliant issuances fall short of this demand. Notable issuances included Dubai Islamic Bank's US$750 mil sustainable Sukuk in November 2022.

Basel III has redefined the criteria for regulatory capital instruments. Accordingly, Islamic banking institutions (IBIs) have to consider the issuance of instruments that would meet both the objectives of Basel III and Shari'ah requirements. This research particularly aims to compare the regulatory requirements for issuing Tier-2 (T2) capital instruments as defined by Basel III, Bank Negara Malaysia (BNM) and IFSB-15. In this regard, the research examines the Shari'ah issues related to subordination and conversion arising in exchange-based contracts (such as murabahah and ijarah sukuk) and equity-based contracts (such as mudarabah and wakalah sukuk). The study relies on library research to collect secondary data in the form of classical works of Islamic jurisprudence, analyses such work and links it with the present day regulatory requirements. The study finds that there are Shari'ah concerns over the use of exchange-based contracts. However, the use of convertible mudarabah and wakalah sukuk could be justified.