ISLAMIC BANKING IN KUWAIT : THEORIES, PRACTICES AND INSIGHTS
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Date
2016-08-10
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International Conference on Islamic Economics Management Accounting Business and Social Sciences (ICIEMABS)I, Fakultas Ekonomi dan Bisnis Universitas Padjajaran, STIE Ibnu Sina, APTISI
Abstract
The broad aim of this paper is to introduce knowledge of Islamic banking theories and practices to banking
financeand practitioners in Kuwait, as well as draw some useful insights on Islamic banking in Kuwait. Prohibition
of interest, low consumer lending, profit and loss sharing and high real sector investing are primary characteristics
of Islamic banks. Islamic banks operate the three conventional deposit accounts. They also engage in investment
financing, trade financing, lending, and other financial services. Differences between Islamic and conventional
banks lie in prohibition of interest, emphasis on Islamic principles of morality, emphasis on collateral, certainty
of deposits and returns, liquidity risk and solvency risk; while similarities between Islamic and conventional banks
lie in profit-making objective and nature of banking services. Though there is a dearth of Islamic banks in Kuwait,
Islamic banking has become a fast growing concept. The emergence of full-fledged Islamic banks in Kuwait
should be expected in the near future.
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Keywords
Islamic Banking, liquidity risk, solvency risk