A Model for Maqasid Analysis of Islamic Banks & Its Application in Pakistan
Abstract/Description
Purpose: This study will enable a comparative analysis of Islamic banks based on Maqasid al-Shariah over a period of time.
Methodology: First, a qualitative approach is used to identify Maqasids, their components and performance measures from the literature review. Next, a list of measurement techniques is consolidated and organized according to the elements of financial statements and then applied on 2 full-fledged Islamic banks to evaluate their progress over the past 5 years.
Findings: The results show that while some maqasids are being addressed for example Shariah non-compliant income of both the banks has decreased over the 5-year period, there are other maqasids that need to be addressed like increase in financing through microfinance.
Originality/value: This study is more comprehensive and organizes the performance measures according to elements of financial statements for ease of evaluation using annual reports.
Research limitations: The development of maqasid ratios is based on literature review and data pertaining to investments in different sectors is not available from the Annual reports hence no analysis could be performed on the same.
Practical implications: This study will enable stakeholders to evaluate Islamic banks using maqasid-based measures so that not only their profitability is evaluated but their contribution towards the well-being of our society is also analysed.
Social implications: This study will enable Islamic banks and regulators to identify gaps and address them so that eventually, over a period of time, Islamic banks are able to contribute more towards the development and progress of our society.
Keywords
Islamic banks, Maqasid, Performance, Ratio analysis, Shariah, Pakistan
Track
Accounting & Law
Session Number/Theme
Session 1D: Accounting & Law
Session Chair
Mr. Haroon Tabraze ; Mr. Mohsin Patel
Start Date/Time
26-5-2023 2:45 PM
End Date/Time
26-5-2023 4:45 PM
Location
G-13, Aman-CED, Ground Floor, Institute of Business Administration, Karachi
Recommended Citation
Nakhoda, Z. R. (2023). A Model for Maqasid Analysis of Islamic Banks & Its Application in Pakistan. 3rd IBA SBS International Conference 2024. Retrieved from https://ir.iba.edu.pk/sbsic/2023/program/16
COinS
A Model for Maqasid Analysis of Islamic Banks & Its Application in Pakistan
G-13, Aman-CED, Ground Floor, Institute of Business Administration, Karachi
Purpose: This study will enable a comparative analysis of Islamic banks based on Maqasid al-Shariah over a period of time.
Methodology: First, a qualitative approach is used to identify Maqasids, their components and performance measures from the literature review. Next, a list of measurement techniques is consolidated and organized according to the elements of financial statements and then applied on 2 full-fledged Islamic banks to evaluate their progress over the past 5 years.
Findings: The results show that while some maqasids are being addressed for example Shariah non-compliant income of both the banks has decreased over the 5-year period, there are other maqasids that need to be addressed like increase in financing through microfinance.
Originality/value: This study is more comprehensive and organizes the performance measures according to elements of financial statements for ease of evaluation using annual reports.
Research limitations: The development of maqasid ratios is based on literature review and data pertaining to investments in different sectors is not available from the Annual reports hence no analysis could be performed on the same.
Practical implications: This study will enable stakeholders to evaluate Islamic banks using maqasid-based measures so that not only their profitability is evaluated but their contribution towards the well-being of our society is also analysed.
Social implications: This study will enable Islamic banks and regulators to identify gaps and address them so that eventually, over a period of time, Islamic banks are able to contribute more towards the development and progress of our society.
