Preview

Islamic Finance as a Form of Financial Intermediation and Financial Stability in Malaysia

Best Essays
Open Document
Open Document
1671 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Islamic Finance as a Form of Financial Intermediation and Financial Stability in Malaysia
Sukuk : Islamic Finance As A Form of Financial Intermediation and Financial Stability in Malaysia

1.0 INTRODUCTION

Beginning in late 2006, the collapse of U.S sub prime mortgage market and the reversal of the housing boom have had a ripple effect around the world. The experience of Mexico around the Tequila crisis and Thailand around the Asian crisis are prototypical examples of the boom-bust cycle (Aaron Turnell and Frank Westermann, 2006, P.48). In fact, more than half of the major world economies, in particular the U.S, the Euro area and Japan, are in recession and experiencing the worst economic contraction since the Great Depression of the 1930s.

To cushion the impact of the economic crisis, the Malaysian government had tabled the First Stimulus Package with an allocation of RM7 billion to sustain growth, ensuring resilient financial sector credit flows, promoting investment and new sources of growth, reprioritizing 9th Plan projects and enhancing social safety net programme (Tan Sri Sulaiman Mahbob, EPU, 2009). While the project under First Stimulus Package is still on, government continued to tabled the larger, comprehensive, encompassing various economic sector and target group of stimulus package also known as Mini Budget.

The target group under second core in the second stimulus package is to increase income of ‘rakyat’ makes government to issue syariah-compliant Savings Bonds (Islamic Bond) understanding that the Islamic bond or Sukuk is one of the Islamic financial instrument that government use to cure the economic crisis.

2.0 FIELD OF RESEARCH

2.1 Islamic Financial System

2.2 The International Bond Market

2.3 The Global Sukuk Market

2.4 Sukuk In Malaysia

3.0 TOPIC OF RESEARCH PROPOSAL

3.1 General

Islamic Financial System

3.2 Specific

Sukuk : Islamic Finance As A Form of Financial Intermediation and Financial Stability in Malaysia

4.0 LITERATURE REVIEW



Bibliography: Aaron Tarnell ad Frank Westermann (2006), Boom-Bust Cycles and Financial Liberalization, The MIT Press Cambridge, Massachusetts, London, England. Ahamed Kameel Mydin Meera, (2002), The Islamic Gold Dinar, Pelanduk Publication, Kuala Lumpur. Abdul Aziz M. Al-Dukhell, (1995), The Banking System and Its Performance In Saudi Arabia, Saqi Books, London. Andrew Baker, David Hudson and Richard Woodword, (2002), Governing Financial Globalization, International Political Economy and Multi-Level Governance, Routledge Taylor & Francis Group, New York. Haji Hahsin bin Haji Mansor (1984), Undang-Undang Perdagangan Islam, Alharamain Sdn Bhd, Kuala Lumpur Issuance of Sukuk Simpanan Rakyat 01/2009, Bank Negara Malaysia, Press Statement Ian H. Giddy (1994), Global Financial Markets, D.C. Heath and Company, Toronto. Mahmood A. El-Gamal, (2006), Islamic Finance Law, Economics and Practice, Cambridge University Press, New York. Muhammad Ayub, (2007), Understanding Islamic Finance, John Wiley & Sons LTD, India. Peter S-Rose (1997), Money and Capital Markets Financial Institution and Instrument in Global Marketplace, Texas A & M University, USA. PR Joshi, (1996), Global Capital Markets, Shopping For Finance, Tata McGraw Hill Publishing, Delhi. Romesh Vaitilingam, (1996) The Financial Times : Guide To Using The Financial Pages, FT Pitman Publishing, Great Britain. Saiful Azhar Rosly (2005), Critical Issues on Islamic Banking and Financial Markets, Dinamas Publishing.

You May Also Find These Documents Helpful

  • Powerful Essays

    Mr Anees Razzak

    • 1252 Words
    • 6 Pages

    Despite exponential growth of Islamic banking in the last decades, Islamic finance is largely concentrated in specific parts of the Muslim world. The potential in non-muslim countries and remote parts of the world is overlooked in many instances. Nevertheless, increasing interest in Muslim and non-Muslim countries alike are contributing to the development of Islamic finance beyond historical boundaries.…

    • 1252 Words
    • 6 Pages
    Powerful Essays
  • Good Essays

    A hospital contains many individuals performing many roles. Chief among them, are the Licensed Vocational Nurse (LVN) and the Registered Nurse (RN). The basics of nursing are the same for both the LVN and RN as they both provide care to individuals who are experiencing injury and/or illness. Both play a very important role in assisting the individual patient toward a speedy recovery and optimal health. This paper will discuss the similarities and differences between the LVN and RN by comparing and contrasting their scope of practice, and their ethical and legal responsibilities.…

    • 888 Words
    • 4 Pages
    Good Essays
  • Powerful Essays

    Sarker, M. A. A. (1999), ‘Islamic Banking in Bangladesh: Performance, Problems and Prospects’, International Journal of Islamic Financial Services, 1(3), http://islamic-finance.net/journal.html…

    • 5176 Words
    • 21 Pages
    Powerful Essays
  • Powerful Essays

    10. Kettell, B. B. (2011). Introduction to Islamic Banking and Finance. New Jersey: John Wiley & Sons.…

    • 6596 Words
    • 27 Pages
    Powerful Essays
  • Good Essays

    Analysis of Sukuk Market

    • 861 Words
    • 4 Pages

    1974 beginning of the first Islamic Financial Institution by the creation of the inter-governmental Islamic Development Bank (IDB) 2001 first GCC Sukuk issuance • Bahrain Monetary Agency USD100 Million 2002 World’s first Islamic global bond issue • Federation of Malaysia USD600 Million…

    • 861 Words
    • 4 Pages
    Good Essays
  • Best Essays

    The dual banking system in Malaysia has enabled banks to offer two forms of financing method, the conventional loan and Islamic financing. In recent years, over a period of more than a decade, financial institutions have offered a wide variety of financing facilities from which consumers could choose. It is well known that the main difference between Islamic banks and conventional banks is interest rates (Haron and Shanmugam, 2000). In Islamic banks, interest rates are forbidden and unlawful to be practiced. Therefore, a new solution has to be created in order to…

    • 2780 Words
    • 12 Pages
    Best Essays
  • Best Essays

    Long before the United States faced the economic bubble in 2006 that has affected many parts of the United States housing market, the Japan already undergone such situation and they manage to overcome it although it went on for so many years. During the 1990s and into the early years of the 21st century, Japan experienced prolonged recessionary economic conditions triggered by the bursting of a bubble in its equity and real estate markets and an ensuing banking crisis. (Nanto, 2009)…

    • 3504 Words
    • 15 Pages
    Best Essays
  • Good Essays

    Kadir, M. R. (2009). Islamic Finance in Malaysia - Evolution & Current Development. Malaysia: Bank Negara Malaysia.…

    • 5661 Words
    • 23 Pages
    Good Essays
  • Good Essays

    Malaysia Financial System

    • 4288 Words
    • 18 Pages

    The Structure of Malaysian Financial System (1) FINANCIAL INSTITUTIONS Banking Systems [monetary inst] Bank Negara Malaysia Banking Institutions a. Comm. Bks (incl. Fin Cos & Insurance and Takaful) and Islamic Bks b. Merchant Bks [non-$tary inst] [nonOthers a. Discount Houses [non-$tary inst] [nonb. Rep. Office of Foreign Bks c. Offshore Banks in Labuan IOFC d. Credit Guarantee Corporation [non-$tary inst] [nonNon-Bank Financial Intermediaries NonProvident and Pension Funds Development Financial Institution Savings Institutions a. National Savings Bank b. Co-operative Societies CoOthers a. Unit Trusts b. Pilgrims Fund Board c. Housing Credit Institutions d. Cagamas Bhd. e. Leasing Cos. f. Factoring Cos. g. Venture Capital Cos.…

    • 4288 Words
    • 18 Pages
    Good Essays
  • Satisfactory Essays

    Sukuk Analysis

    • 757 Words
    • 4 Pages

    Corporate were the initial pioneers of Sukuk in the early 2000's. However, by 2008 the Indonesian government had taken the initiative to act out some laws to facilitate Shari'ah financing. This has resulted in Indonesian government taking the lead in issuing Sukuk on a regular basis, laying the framework for the issuance by corporates. Domestic Sukuk is a valuable tool for the Central Bank (BOI) policy in having Sukuk Negara as part of its monetary operation. Retail Sukuk provides for wider understanding and acceptance of Sharia compliant investments as well as encouraging savings. It is no surprise that the Banks and Insurance companies are taking up the majority of the Sukuk, as GOI offers “risk-free” return as well as duration investment to match their Asset and Liability. Also, encouraging to note that 18 percent of the market share of tradeable Sukuk are from individuals Retail…

    • 757 Words
    • 4 Pages
    Satisfactory Essays
  • Best Essays

    Hassan Ali. (2012). The Future of Islamic Finance. Accountants Today Vol. May/June 2012. Pp. 60-62.…

    • 3745 Words
    • 15 Pages
    Best Essays
  • Satisfactory Essays

    What’s in It for Me? A Primer on Differences between Islamic and Conventional Finance in Malaysia…

    • 7238 Words
    • 29 Pages
    Satisfactory Essays
  • Powerful Essays

    Malaysian financial system

    • 2235 Words
    • 36 Pages

    Strong financials  Contributes almost 12% of GDP  Workforce of 150,000  Regional presence  Global leader and centre for Islamic finance  Largest bond market in South East Asia The financial sector and the economy  macroeconomy household sector  financial sector  corporate sector   financial & property markets 5 Financial instability can cause serious breakdown in market functioning, with adverse…

    • 2235 Words
    • 36 Pages
    Powerful Essays
  • Powerful Essays

    testing for multiple buubles

    • 15864 Words
    • 124 Pages

    References: Ahamed, L., 2009, Lords of Finance: The Bankers Who Broke the World, Penguin Press, New…

    • 15864 Words
    • 124 Pages
    Powerful Essays
  • Powerful Essays

    islamic accounting

    • 6765 Words
    • 28 Pages

    would have a wide scope and just not be limited to Islamic finance. The paper…

    • 6765 Words
    • 28 Pages
    Powerful Essays