Search results for: Dow Jones Islamic index

Authors: Abul Shamsuddin

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The Islamic stock market indices are constructed by screening out stocks that are incompatible with Islam’s prohibition of interest and certain lines of business. This study examines the effects of Islamic screening on the risk-return characteristics of Islamic vis-a-vis mainstream equity portfolios. We use data on Dow Jones Islamic market indices and FTSE Global Islamic indices over 1993-2013. We observe that Islamic equity indices outperform their mainstream counterparts in both raw and risk-adjusted returns. In addition, Islamic equity indices are more resilient to turbulence in international markets than that of their mainstream counterparts. The findings are robust across a variety of portfolio performance measures.

Keywords: Dow Jones Islamic market index, FTSE global Islamic index, ethical investment, finance

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Authors: Imen Dhaou

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This study examines conditional Value at Risk by applying the GJR-EVT-Copula model, and finds the optimal portfolio for eight Dow Jones Islamic-conventional pairs. Our methodology consists of modeling the data by a bivariate GJR-GARCH model in which we extract the filtered residuals and then apply the Peak over threshold model (POT) to fit the residual tails in order to model marginal distributions. After that, we use pair-copula to find the optimal portfolio risk dependence structure. Finally, with Monte Carlo simulations, we estimate the Value at Risk (VaR) and the conditional Value at Risk (CVaR). The empirical results show the VaR and CVaR values for an equally weighted portfolio of Dow Jones Islamic-conventional pairs. In sum, we found that the optimal investment focuses on Islamic-conventional US Market index pairs because of high investment proportion; however, all other index pairs have low investment proportion. These results deliver some real repercussions for portfolio managers and policymakers concerning to optimal asset allocations, portfolio risk management and the diversification advantages of these markets.

Keywords: CVaR, Dow Jones Islamic index, GJR-GARCH-EVT-pair copula, portfolio optimization

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Authors: Mahmood Mohammed Abdulsattar Aljumaili

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Praise be to Allah and peace and blessings be upon the Messenger of Allah. Islamic banks have not only made a lot of great achievements in a short period, but they imposed themselves in the global market, not to mention the transformation of some conventional interest-based banks to Islamic banks to the large demand on them, this transformation has pushed the Dow Jones Global Foundation to develop a new economic indicator released it (the Dow Jones Islamic market) for those who wish to invest in Islamic financial institutions. The success of Islamic financial institutions today face significant and serious challenges, that embody the serious consequences created by the current events on Islamic banking industry. This modest study, deals with these serious challenges facing the Islamic banking industry, and reflected on the success recorded in the previous period. The study deals with four main topics: The emergence of Islamic banks, the goals of Islamic banks, International challenges facing Islamic banks, internal challenges facing Islamic banks, and finally it touches on, (Basel 1-2) Agreement and its implications for Islamic banks.

Keywords: Islamic banks, Basel 1-2 agreement, most important contemporary challenges, islamic banking industry, Dow Jones Islamic market

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Authors: Rosyidah, Permata Wulandari

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We investigate the price effect of addition and deletions from the Indonesia Sharia Stock Index (ISSI) and Jakarta Islamic Index (JII). Using event study methodology, we measure abnormal returns for firms over the period June 2019 - to December 2021. Through the sample of 107 additions and 95 deletions, we find evidence to support the theory of Muslim country investment behavior. We find that additions to the Islamic index led to a significant positive stock market reaction and deletions to the Islamic index led to a negative stock market reaction on Jakarta Islamic Index (JII) and there is no significant reaction of addition and deletion on Indonesia Sharia Stock Index (ISSI).

Keywords: abnormal return, abnormal volume, event study, index changes, sharia index

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Authors: Asma Ammar

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Being different in theory and practice from their conventional counterparts, this research aims to assess the performance of Islamic banks beyond the financial performance by emphasizing their ethical and social identity based on the higher purposes of Islamic law, namely Maqasid al-Shariah. Using Imam al-Ghazali’s theory of Maqasid al-Shariah and Sekaran’s (2000) method, we develop a Maqasid-based index including the five objectives of Shariah (preservation of life, religion, intellect, posterity, and wealth). Our sample covers 9 Islamic banks considered among the largest Islamic banks in the world. For the five years of study (2017-2021), our results reveal that the highest score is performed by Bank Muamalat while the least score is given to Dubai Islamic Bank. The overall Maqasid performance of the sample is unimpressive, indicating that there is a lack of achievement in Maqasid al-Shariah performance of Islamic banks. Consequently, serious measures should be taken by Islamic banks to improve their Maqasid performance and thus contribute effectively to the socio-economic development of the countries in which they operate.

Keywords: Maqasid al-Shariah, Maqasid al-Shariah index, Islamic banks, performance assessment

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Authors: Ahmet Sekreter

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Although there are conceptual similarities in terms of financial products between conventional and Islamic finance, they are entirely different financial systems. Despite Islamic finance’s small size in the conventional finance world, its promising growth makes Islamic finance a hot topic both in academia and business world. Today customers can access sophisticated Islamic financial products not only in Muslim countries but also in Europe. This study analyzes Islamic finance and its products and includes a brief overview of Islamic finance in Europe. Literature review is the basis of this paper. The author analyzed the academic papers, numerical data, and estimations to set a perspective for the future of Islamic finance in Europe. Findings show that UK is the main hub for the Islamic finance, and it will remain so in the near future.

Keywords: islamic finance, islamic banking, islamic finance in Europe, finance

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Authors: Asif Zaheer Shaikh, Zhaoyong Zhang, Jaime Yong, Ume Laila Shah

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Islamic finance is growing with remarkable pace, especially Islamic banking, a major segment of Islamic finance, is expanding rapidly. This paper discusses the position of Islamic finance and Islamic banking, around the world in general and particularly in Pakistan. History of Islamic banking in Pakistan is protested, presently a significant growth is observed. However Islamic banking is confronting with number of challenges, which are refraining from sustainable growth of this industry in Pakistan. Growth level of Islamic banks should be steeper to contribute substantial share in country’s economy. It is important to formulate effective policies, at institutional and operational level to address these challenges through close collaboration of key stakeholders.

Keywords: Islamic finance, challenges, Islamic banking, Pakistan

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Authors: Samir Srairi

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This paper investigates the impact of the internal corporate governance on bank performance by constructing a corporate governance index (CGI) for 27 Islamic banks operating in five Arab Gulf countries. Using content analysis on the banks’ annual reports for 3 years (2011-2013), the index construction uses information on six important corporate governance mechanisms, namely board structure, risk management, transparency and disclosure, audit committee, Sharia supervisory board and investment account holders. The results demonstrate that Islamic banks adhere to 54% of the attributes addressed in the CGI. The most frequently reported and disclosed elements are Sharia supervisory board followed by board structure and risk management. The findings related to countries revealed that only two countries, the United Arab Emirates and Bahrain, possess a higher level of CGI. Our regression results provide evidence that Islamic banks with higher levels of corporate governance report high operating performance measured by return on assets and net interest margin. Finally, as of the effect of internal and external factors, we identified four variables that were associated with bank performance, namely size, equity, risk and concentration.

Keywords: governance mechanisms, corporate governance index, bank performance, Islamic banks, GCC countries

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Authors: Seyed Razi Nousavi Gilani

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Islamic culture and especially the Shia is full of mystical and philosophical elements. A close look at the history of Islamic civilization, which is supposed to represent the teachings and words of faith leaders with the knowledge and use of the philosophical and mystical concepts, has influenced Islamic art. This article explains the influence of Shiite Islamic teachings and their teachings of mystical elements on Islamic art and examines as case studies in the arts such as architecture, calligraphy and painting. These arts have always been associated with mystical and philosophical teachings in view of traditional artists.

Keywords: mystics, Islamic Art, Islamic culture, mystic

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Authors: Cupian

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The expansion of Islamic banking industry seems to emphasize the banking competition in Indonesia where conventional and Islamic banks coexist. In addition, the 2007/2008 global financial crisis and deregulation have the effect on competitive conditions in Islamic banking market. In this context, this study aims at investigating competitive conditions and market power of Islamic banks in Indonesia using firm level data over the period 2006-2013. The study also attempts to identify the factors that represent the power of banking market to better study the degree of competition in this banking industry. Using samples of 27 Islamic commercial banks, the study uses a variety of structural and non-structural measures related to the traditional approach and the new empirical approach of the industrial organization (NEIO). The methodology is based on the set of measures of the competition and market power. The first measure is a set of concentration ratios (CR4) and Herfindahl-Hirschman index (HHI).The second measures are the Panzar and Ross H-statistic and the Lerner index based on econometric estimations with the aim of evaluating the market structure and measuring its power in terms of price setting. The results of the competition analysis suggest that the Islamic banking markets in Indonesia cannot be characterized by the bipolar cases of either perfect competition or monopoly over 2006-2013. That is, banks earned their revenues operating under conditions of monopolistic competition in that period. Overall, Islamic banks in Indonesia operate in a relatively less competitive environment or in high market power. It is also indicated that Islamic bank that hope to achieve higher returns should operate in the competitive environment.

Keywords: bank competition, islamic banks, market structure, profitability

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Authors: Dwi Wijiastutik, Tarjo, Yuni Rimawati

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The purpose of this empirical study is to analyse how to the market reaction and the conservative degree changes on the adoption of International Financial Reporting Standart (IFRS) through Jakarta Islamic Index. The study also has given others additional analysis on the profitability, capital structure and size company toward IFRS adoption. The data collection methods used in this study reveals as secondary data and deep analysis to the company’s annual report and daily price stock at yahoo finance. We analyse 40 companies listed on Jakarta Islamic Index from 2010 to 2014. The result of the study concluded that IFRS has given a different on the depth analysis to the two of variance analysis: Moderated Regression Analysis and Wilcoxon Signed Rank to test developed hypotheses. Our result on the regression analysis shows that market response and conservatism principle is not significantly after IFRS Adoption in Jakarta Islamic Index. Furthermore, in addition, analysis on profitability, capital structure, and company size show that significantly after IFRS adoption. The findings of our study help investor by showing the impact of IFRS for making decided investment.

Keywords: IFRS, earnings response coefficient, conservatism principle

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Authors: Mohammad Iqbal Maiik

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Islamic marketing ethics combines the principle of value maximization with the principles of equity and justice for the welfare of the society. Adherence to the Islamic ethics in the Islamic banking industry can help elevate the standards of both behavior and living of bankers and customers alike. In a rapidly changing marketing environment, the need to be customer-focused has never been as important as it is today. At present where customers are becoming more demanding and increasingly mobile between competing financial providers, being customer-focused is not enough. Islamic banks and more specifically their customer-contact employees (customer relation advisers or officers) need to be perceived by their customers as being Islamic. This study represents an initial step in analyzing the role of Islamic ethical sales behavior as it may be perceived by the customers of Islamic Banks.

Keywords: Islam, ethics, marketing, Islamic banks

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Authors: Mohammad Torabiyan, Kazem Mosawi Nejad

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Today architecture has become as a powerful media for introducing cultures to the world, which in turn brings about a change in the global insight, power gaining, investment and development. Islamic architecture is based on the language of Koran and shows the depth and richness of Islam through spiritual soul. This is in a way that belief in monotheism and faith in Islamic teachings are manifested as Islam's aesthetic thought in Islamic architecture. Unfortunately, Islamic architecture has been damaged a lot due to lack of necessary information and also successive wars which have overtaken the Muslims as well as the dominance of colonizing counties. Islamic architecture is rooted in the history, culture and civilization of Muslims but its deficiencies and shortcomings should be removed through systematizing the Islamic architecture researchers. Islamic countries should act in a way that the art of Islamic architecture shows its true place in different architecture eras and makes everybody aware that Islamic architecture has a historical root and is connected eternally to the genuineness, religious art and culture of Muslims and civilization.

Keywords: art, culture, civilization, Islamic architecture, Muslims

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Authors: Kaoutar Abbahaddou, Mohammed Salah Chiadmi

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The need to find a relevant way to predict the next-day price of a stock index is a real concern for many financial stakeholders and researchers. We have known across years the proliferation of several methods. Nevertheless, among all these methods, the most controversial one is a machine learning algorithm that claims to be reliable, namely neural networks. Thus, the purpose of this article is to study the prediction power of neural networks in the particular case of Islamic finance as it is an under-looked area. In this article, we will first briefly present a review of the literature regarding neural networks and Islamic finance. Next, we present the architecture and principles of artificial neural networks most commonly used in finance. Then, we will show its empirical application on two Islamic stock indexes. The accuracy rate would be used to measure the performance of the algorithm in predicting the right price the next day. As a result, we can conclude that artificial neural networks are a reliable method to predict the next-day price for Islamic indices as it is claimed for conventional ones.

Keywords: Islamic finance, stock price prediction, artificial neural networks, machine learning

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Authors: Deden Misbahudin Muayyad, Lavlimatria Esya

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Up to the month of June 2015, Indonesia has 12 Islamic Commercial Banks, 22 Islamic Business Unit, 327 offices in 33 provinces. The initial purpose of the establishment of Islamic financial institutions is to achieve and the welfare of the people in this world and in the hereafter. To realize these goals, the Islamic financial institutions in every kind of aspect of product development and in terms of operations should be based on maqashid sharia, namely keeping the faith, keep the soul, keep the sense, maintain the property, keeping the offspring. To see whether Islamic banking grounded in maqasid sharia, the Islamic banking performance measurements based on the principles of maqasid sharia. Banking performance measurement is not only focusing on profit and other financial measures, but put other values of banks reflects the size of the benefit of non-profit in accordance with the bank's objectives. The measurement using the measurement of financial performance called maqasid sharia index. Maqasid syariah index is a model of Islamic banking performance measurement in accordance with the objectives and characteristics of Islamic banking. Maqasid syariah index was developed based on three main factors, namely the education of individuals, the creation of justice, the achievement of well-being, where the three factors were in accordance with the common goal of maqasid sharia is achieving prosperity and avoid evil. Maqasid syariah index shows that maqasid sharia approach can be a strategic alternative approach to describe how good the performance of the banking system and it can be implemented in the comprehensive policy strategy. This study uses a model of performance measurement framework based on maqasid syariah, in addition to financial performance measures that already exist. Methods to develop the idea of a performance measurement framework of Islamic banking by maqasid sharia is the Sekaran method. Operationally, the methods have now able to describe the elements that will be measured by this study. This is done by observing the behavior of the dimensions illustrated through a concept that has been set. These dimensions translate into derivative elements that can be observed and more scalable, so it can establish measurement indices. This research is descriptive quantitative. Techniques are being made to collect data in this paper is by using purposive sampling method, with 12 Islamic Commercial Banks that qualify as research samples. The financial data taken at 12 banks was sourced from the annual financial statements the period 2008 to 2012 with consideration of the database and ease of access to data. The ratio measured in this study only 7 ratio used in determining the performance of Islamic banking, namely: four ratio refers to the sharia objectives related to education. three ratio while again referring to sharia objectives related to the achievement of welfare. While other ratios associated with justice can not be used in this study because of the limited data used. Total overall calculation of performance indicators and performance ratios on each goal for each bank describes the maqasid syariah index.

Keywords: Islamic banking, Maslahah, maqashid syariah, maqashid syariah index

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Authors: Audia Syafa'atur Rahman, Rozali Haron

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The practices of Islamic banking are more attuned to the goals of profit maximization rather than obtaining ethical profit. Ethical profit is obtained from interest-free earnings and to give an impact which benefits to the growth of society and economy. Good corporate governance practices are needed to assure the sustainability of Islamic banks in order to achieve Maqasid Shariah with the main purpose of boosting the well-being of people. The Maqasid Shariah performance measurement is used to measure the duties and responsibilities expected to be performed by Islamic banks. It covers not only unification dimension like financial measurement, but also many dimensions covered to reflect the main purpose of Islamic banks. The implementation of good corporate governance is essential because it covers the interests of the stakeholders and facilitates effective monitoring to encourage Islamic banks to utilize resources more efficiently in order to achieve the Maqasid Shariah. This study aims to provide the empirical evidence on the Maqasid performance of Islamic banks in relation to the Maqasid performance evaluation model, to examine the influence of SSB characteristics and board structures to Islamic Banks performance as measured by Maqasid performance evaluation model. By employing the simple additive weighting method, Maqasid index for all the Islamic Banks in Indonesia within 2012 to 2016 ranged from above 11% to 28%. The Maqasid Syariah performance index where results reached above 20% are obtained by Islamic Banks such as Bank Muamalat Indonesia, Bank Panin Syariah, and Bank BRI Syariah. The consistent achievement above 23% is achieved by BMI. Other Islamic Banks such as Bank Victoria Syariah, Bank Jabar Banten Syariah, Bank BNI Syariah, Bank Mega Syariah, BCA Syariah, and Maybank Syariah Indonesia shows a fluctuating value of the Maqasid performance index every year. The impact of SSB characteristics and board structures are tested using random-effects generalized least square. The findings indicate that SSB characteristics (Shariah Supervisory Board size, Shariah Supervisory Board cross membership, Shariah Supervisory Board Education, and Shariah Supervisory Board reputation) and board structures (Board size and Board independence) have an essential role in improving the performance of Islamic Banks. The findings denote Shariah Supervisory Board with smaller size, higher portion of Shariah Supervisory Board cross membership; lesser Shariah Supervisory Board holds doctorate degree, lesser reputable scholar, more members on board of directors, and less independence non-executive directors will enhance the performance of Islamic Banks.

Keywords: Maqasid Shariah, corporate governance, Islamic banks, Shariah supervisory board

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Authors: Janiel David Melamed Visbal

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The Islamic State has become one of the most remarkable threats for international security through their religious extremism and their establishment of a new caliphate by force. The main objective of this organization is to obtain territorial expansions beyond the Middle East and eventually to consolidate an Islamic global order based on their extremist ideology. This paper will conduct an analysis regarding how, over the past year, many jihadist organizations worldwide have pledged their alliagance to the Islamic State, transforming it into the most important jihadist franchise globally.

Keywords: Islamic state, franchise, jihad, Islamic fundamentalism, caliphate

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Authors: Shaibu Ali, Sherif Heiman Shaban, Musah Ismaila, Imoro Alhassan, Yusif Ali

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Purpose: Islamic banking and finance is one of the most rapidly growing segments of the global finance industry. Starting with the Dubai Islamic Bank in 1975, the number of Islamic financial institutions worldwide has shot up astronomically, to over three hundred, with operations in seventy-five countries and assets in excess of US$400 billion. The purpose of this study is to explore the prospects and challenges of Islamic banking introduction in a non-Islamic country like Ghana. Design/Methodology: Data for the study was collected via an expert opinion of three Islamic scholars on Islamic banking from Ghana. Findings: Findings from this study indicates some of the benefits of Islamic banking includes connecting financial markets and economic activity, promoting the principle of financial justice, greater stability, avoiding economic bubbles (and bursts) and reducing the impact of harmful products and practices. The study also identified lack of experts in various fields of Islamic banking, product innovation, moral hazard, and need for experienced staff in Islamic banking as some of the challenges to Islamic banking system’s introduction. Contribution: The study contributes to literature on Islamic banking from a non-Islamic country like Ghana.

Keywords: Islamic banking, Shari’ah, Riba, conventional banking

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Authors: Mahfoud Djebbar

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The past two decades or so have witnessed phenomenal growth of the Islamic financial services industry. The whole industry has been thriving at about 15 percent per annum. This development entails the Islamic financial engineering, IFE, to some kind of crossroads, lagging behind its conventional counterpart. Therefore, IFE, and particularly traded products development, and in order to achieve its goals, two approaches are available, i.e., replicating engineering and innovative engineering. We also try to emphasis the innovative strategy since it guards the Islamic identity of different financial products and processes, and thereby, improves the creativity in the Islamic financial industry. The attempt also centers on sukukization (Islamic securitization), innovation, liquidity management, and risk management and hedging in the Islamic financial system. Finally, the challenges facing IFE are also addressed.

Keywords: islamic financial engineering, hedging and risk management, innovation, securitization, money market instruments, islamic capital markets

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Authors: Mohamed Saad Ahmed Hussien

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This paper discusses the risk management in Islamic banks and aims to determine the difference in the practices and methods of risk management in those banks compared to the conventional banks, and to make a case study of the biggest Islamic bank in Egypt (Faisal Islamic Bank of Egypt) to identify the most important financial risks faced and how to manage those risks. It was found that Islamic banks face two types of risks. The first type is similar to the risks in conventional banks; the second type is the additional risks which facing the Islamic banks only as a result of some Islamic modes of financing. With regard to the risk management, Islamic banks such as conventional banks applied the regulatory rules issued by the Central Banks and the Basel Committee; Islamic banks also applied the instructions and procedures issued by the Islamic Financial Services Board (IFSB). Also, Islamic banks are similar to the conventional banks in the practices and methods which they use to manage the risks. And there are some factors that may affect the risk management in Islamic banks, such as the size of the bank and the efficiency of the administration and the staff of the bank.

Keywords: conventional banks, Faisal Islamic Bank of Egypt, Islamic banks, risk management

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Authors: Mohd Yazid M. Yunos, R. Arinah, Nor Kalsum M. Isa, U. Nangkula, Nor A. Ismail, Nor F. Ariffin

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Islamic City planning is a concept of optimizing the overall arrangement of land use without compromising community. The concept was influenced by the specific intentions in mind, applying certain ideological principles and objectives rooted in Islamic faith and Muslim culture using distinct design elements. Holy Quran and hadiths provide a foundation for understanding Islamic Principles as clearly shared by the established Islamic Cities such as Medina, Mecca and Jerusalem. This paper aimed to explore the principles and elements of an Islamic City through the review of relevant literature by the means of Content Analysis method. A theoretical framework of Islamic City Principles was then formulated to be the main outcome of the study. The finding is very important to be a useful starting point for future study, especially for formulating a clear guide for the development of upcoming Islamic City in Malaysia.

Keywords: Islamic principles, sustainable city planning, Islamic city, Malaysia

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Authors: Aslam Faheem, Hunjra Ahmed Imran, Tayachi Tahar, Verhoeven Peter, Tariq Yasir

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We investigate the evidence of three risk-adjusted calendar anomalies in eight frontier markets. Our sample consists of the daily closing prices of their stock indices for the period of January 2006 to September 2019. We categorize the data with respect to day-of-the-week, Lunar calendar and Islamic calendar. Using Morgan Stanley Capital International (MSCI) eight Markets Index as our proxy of the market portfolio, most of the frontier markets tested exhibit calendar seasonality. We confirm that systematic risk varies with respect to day-of-the-week, Lunar months and Islamic months. After consideration of time-varying risk and applying Bonferroni correction, few frontier markets exhibit profitable investment opportunities from calendar return anomalies for active investment managers.

Keywords: asset pricing, frontier markets, market efficiency, Islamic calendar effects, Islamic stock markets

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Authors: Camille Paldi

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As the Islamic finance industry is growing annually at a rate of 10% to 15% per year, it is imperative that a unique, independent legal framework is established in order to effectively adjudicate Islamic finance disputes. Currently, Islamic finance disputes are being adjudicated in inadequate civil and common law courts and arbitration centers where the contracts in dispute are being transformed from Islamic to conventional transactions. Through case analysis combined with an exploration of the efficacy of existing arbitration centers and dispute resolution methods available to Islamic finance, this paper will seek to reveal that the Islamic finance industry currently lacks an adequate dispute resolution mechanism and facility to adjudicate disputes arising from Islamic finance contracts. Hence, now is the time for the Dubai World Islamic Finance Arbitration Center (DWIFAC) and Jurisprudence Office (DWIFACJO) as the Dispute Resolution Center and Mechanism for the Islamic Finance Industry.

Keywords: Islamic finance, dispute resolution, Dubai world Islamic finance arbitration center, jurisprudence office

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Authors: Tasawar Nawaz

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Promotion of socioeconomic justice through redistribution of wealth is one of the most salient features of Islamic economic system. Islamic financial institutions known as Islamic banks are used to implement this in practice under the guidelines of Islamic Shariah law. Islamic banking systems strive to promote and achieve financial inclusion among the society by offering interest-free banking and risk-sharing financing solutions. Shariah-compliant micro finance is one of the most popular financial instruments used by Islamic banks to enhance access to finance. Benevolent loan (or Qard-al-Hassanah) is one of the popular financial tools used by the Islamic banks to promote financial inclusion. This aspect of Islamic banking is empirically examined in this paper with specific reference to firm’s resources, largely defined here as intellectual capital. The paper finds that Islamic banks promote financial inclusion by exploiting available resources especially, the human intellectual capital.

Keywords: financial inclusion, intellectual capital, Qard-al-Hassanah, Islamic banking

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Authors: Jyoti Bharti, M. K. Gupta, Astha Jain

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This paper proposes a new improved approach for false positives filtering of detected face images on OpenCV’s Viola Jones Algorithm In this approach, for Filtering of False Positives, Skin Detection in two colour spaces i.e. HSV (Hue, Saturation and Value) and YCrCb (Y is luma component and Cr- red difference, Cb- Blue difference) is used. As a result, it is found that false detection has been reduced. Our proposed method reaches the accuracy of about 98.7%. Thus, a better recognition rate is achieved.

Keywords: face detection, Viola Jones, false positives, OpenCV

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Authors: Zareen Khan

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Islamic Banking has experienced high growth in Pakistan in recent years and has successfully survived the economic downturn of 2009-2011. Despite the increase in branch network and expansion of services, it is unclear if Islamic banks are truly following the theory and practical application of Shariah Law. This paper explores the theological basis of Islamic finance and examines the discrepancies between the theory and practice of Islamic banking using Pakistan as a case study. It discusses areas where Islamic banks lack proper Shariah compliance and analyzes the financial weaknesses of Islamic banks in terms of the services offered. Furthermore, the paper offers plausible explanations for the clientele of Islamic banks. The case study has three major findings. Firstly, most of the employees of Islamic banks come from conventional banking backgrounds and the banks have to invest in additional trainings to specialize employees in Islamic Banking. Secondly despite the efforts of State Bank of Pakistan, there is a lack of accounting and auditing standards tailored for Islamic Banking. Thirdly, majority of the clients of Islamic banks in Pakistan are accustomed to conventional banking causing the bankers to “speak the conventional banking language.” Combined, these three factors can create gaps in the practical application of Islamic finance in Islamic banks in Pakistan.

Keywords: islamic finance, comparing theory with practice, islamic banking, Pakistan

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Authors: Safiyya A. Abba, Shehu U. R. Aliyu

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This paper deals with Islamic social security: a discourse explores the meaning and nature of Islamic social security system. The paper reviews the social security framework and operations during the early period. The paper further identifies the instruments of Islamic social security discusses its principles and objectives. The paper discovers that Islamic social security is a personification of a comprehensive welfare approach in view of its varied instruments that are deeply rooted in the Islamic law, unique principles and realistic and achievable objectives. Furthermore, the Islamic social security system has far reaching socioeconomic implications; social justice, cohesion, equity, a catalyst for poverty eradication, income redistribution, economic growth and development.

Keywords: Islamic social security, basic needs, zakat, socioeconomic justice, equity

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Authors: Mohd Adib Abd Muin

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Social entrepreneurship has become a new phenomenon in a country in order to reduce social problems and eradicate poverty communities. However, the study based on Islamic social entrepreneurship from the social entrepreneurial activity is still new especially in the Islamic perspective. In addition, this research found that is lacking of model on social entrepreneurship that focus on Islamic perspective. Therefore, the objective of this paper is to identify the issues and research gap based on Islamic perspective from existing models and to develop a concept of Islamic social entrepreneurship according to Islamic perspective and Maqasid Shari’ah. The research method used in this study is literature review and comparative analysis from 11 existing models of social entrepreneurship. The research finding shows that 11 existing models on social entrepreneurship has been analyzed and it shows that the existing models on social entrepreneurship do not emphasize on Islamic perspective.

Keywords: component, social entrepreneurship, Islamic perspective, research gap

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Authors: Ahmad Abdulkadir Ibrahim

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Observation of the methodology of Islamic economics laid down for the methods and instruments of analysis and even some of its basic assumptions in the modern world; is a matter that is of paramount importance. There is a need to examine the implications of different suggested definitions of Islamic economics, exploring its scope and attempting to outline its methodology. This paper attempts to deal with the definition of Islamic economics, its methodology, and its scope. It will outline the main methodological problem by addressing the question of whether Islamic economics calls for a methodology of its own or as an expanded economics. It also aims at drawing the attention of economists in the modern world to the obligation and consideration of the methodology of Islamic economics. The methodology adopted in this research is library research through the consultation of relevant literature, which focuses on the thematic study of the subject matter. This is followed by an analysis and discussion of the contents of the materials used. It is concluded that there is a certain degree of inconsistency in the way assumptions are incorporated that perhaps are alien to Islamic economics. The paper also observed that there is a difference between Islamic economists and other (conventional) economists in the profession. An important conclusion is that Islamic economists need to rethink what economics is all about and whether we really have to create an alternative to economics in the form of Islamic economics or simply have an Islamic perspective of the same discipline.

Keywords: methodology, Islamic economics, conventional economics, Muslim economists, framework, knowledge

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Authors: Amira Kaddour, Hedia Teraoui, Khmayes Bougatef

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The main purpose of this paper is to determine the major causes of the underdevelopment of Islamic finance in Tunisia. Indeed, it’s surprising to note that Zitouna bank established in May 2010 is the first Islamic Tunisian bank although 99% of Tunisians are Muslim and Islam is the religion of the State according to the Constitution. So we rely in our paper on the opinions of number of professors of finance and economics as educated people to prove or reject our hypothesis that the underdevelopment of Islamic finance in Tunisia can be explained by the ignorance of its main principles and advantages. Ours findings reveal that this branch of finance is still largely unknown, not only from public but also from professionals. The results obtained surprisingly show that this insignificance of Islamic banking cannot be explained by the fact that Tunisia has been governed since its independence by a secular left-wing party. Indeed, only 3% of respondents believe that legislation and regulation in Tunisia represent an obstacle to the development of Islamic finance. Moreover, respondents are not very optimistic about the future role of Islamic financing.

Keywords: Islamic banking, Islamic insurance (takaful), Islamic law (shariah), usury (riba)

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