Reputation risk and its impact on the islamic banks

Case of the Murabaha

Mohamad Sabri Haron, Rashila Ramli, Malek Marwan Yousef Injas, Raghad Azzam Injas

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

Murabaha to the purchase orderer (MPO) is a rival product in the Islamic banking (IBs) system. It is implemented in the most of IBs. However, there is a controversy among contemporary jurists (Shari’ah Supervisory Board [SSBs]) in the mechanism of the implementation of this product. The objective of this study is to show the controversial issues related to the product of Murabaha and to identify its impact on the bank’s reputation. This study is an exploratory study therefore, based on the literature review relating to the issues of MPO, reputation risk, and non-compliance risk. This study tries to describe and reveal the relationship between reputation and non-compliance risk. As well as revealing the impact of reputation risk on the IB stability and financial performance. It aims to brought the attention of decision-makers regarding consequences of these risks. At the end of this paper, concluded that the IBs like all other corporations, affected by the risks reputation, despite their principles that based on Islamic precepts.

Original languageEnglish
Pages (from-to)854-859
Number of pages6
JournalInternational Journal of Economics and Financial Issues
Volume5
Issue number4
Publication statusPublished - 2015

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Islamic financial institutions
Islamic banking
Purchase
Noncompliance
Financial performance
Exploratory study
Supervisory board
Banking system
Literature review
Decision maker

Keywords

  • Islamic bank
  • Murabaha to the purchase orderer
  • Non-compliance risks
  • Reputational risks

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)

Cite this

Reputation risk and its impact on the islamic banks : Case of the Murabaha. / Haron, Mohamad Sabri; Ramli, Rashila; Yousef Injas, Malek Marwan; Injas, Raghad Azzam.

In: International Journal of Economics and Financial Issues, Vol. 5, No. 4, 2015, p. 854-859.

Research output: Contribution to journalArticle

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