RISK MANAGEMENT IN ISLAMIC FINANCIAL INSTITUTION

With the rapid development of the industry, it is high time that focus is shifted to risk management specifically in Islamic finance. Like any other organizations, Islamic financial institutions need to understand the risks that they are exposed to, which is an important consideration in strategizing their business direction. As the industry is still considered relatively young in comparison to conventional banks, it is not surprising that many people may have the mindset that Islamic finance is not much different from conventional finance and therefore the same goes with the risk management aspect of it; some may simply conclude that Islamic finance carries higher risk than conventional bank, and thus avoiding the former may be the solution. This book will show why these thoughts need to be corrected by pointing out various types of risks which are only unique to Islamic finance, and ways to mitigate them for purpose of making Islamic finance as competitive and as acceptable as conventional finance. Not only the unique features. of Islamic Finance are presented, the book also shares how the common risk approaches or methodologies can be applied in structuring Islamic finance products. By understanding the risks, financial institutions may appreciate opportunities and potential rewards that accompany the risks. The book covers risk management in the three main segments of the finanfiifil industry namely banks, takdful and capital markets

• BY KHADIJA ISKANDAR
• PUBLISHED BY IBFIM