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Sub-prime issue: How Islamic financing able to solve the problem during financial crisis

Daud, Mohd Hapandi (2009) Sub-prime issue: How Islamic financing able to solve the problem during financial crisis. Discussion Paper. Universiti Utara Malaysia. (Unpublished)

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Sub-prime crisis rise due to imprudent credit practice by the lender beside the other factors. Unethical element consist in the conventional financial system such as permissible speculation and allowable selling of debt’s mortgages via asset securitization created the situation become worse. In Islam, Islamic financing have their own way to fiancé the mortgages which is permissible in Islamic Principles. Islamic Principles prohibits the payment and collection of interest and highly complex instrument such as derivatives and other “creative” accounting practice are banned. Transaction must be backed by real asset that avoiding repackaged sub-prime mortgages. The credit rating under Islamic banking and finance evaluates real term business potential and growth trends, instead of evaluating manipulation asset value which causing damages to the credit and economy.

Item Type: Monograph (Discussion Paper)
Additional Information: Master of Science (Banking) - (WBB 6013: Seminar in Banking)
Uncontrolled Keywords: Sub-prime Issue, debt mortgages, economic impact, Islamic Principles,Islamic Financial solution.
Subjects: H Social Sciences > HG Finance
Divisions: School of Economics, Finance & Banking
Depositing User: Mrs. Norazmilah Yaakub
Date Deposited: 22 Feb 2011 02:03
Last Modified: 25 Apr 2016 06:26
URI: http://repo.uum.edu.my/id/eprint/2461

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