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Risk Management Practices and Islamic Bankers’ Perception about Potential Risk in Islamic Countries

Author

Listed:
  • Riaz, Samina
  • Khan, Muhammad Irfan
  • Iqbal, Athar

Abstract

This paper investigates the extent to which the Islamic bankers (Risk managers & Chief Financial Officers, (CFOs) understand risk management practices and perception of Islamic bankers about identification of potential risks in Malaysia, UAE and Pakistan. The sample consists of forty eight risk managers and CFOs in three Islamic countries. The results indicate that Malaysia has more females (59%) working as risk managers and CFOs between the age of 31-40 years than UAE and Pakistan. Moreover, Malaysian risk managers and CFOs have better understanding of risk management practices as well as identification of potential risk. After Malaysia the UAE is better in risk management practices as compared to Pakistan. Similarly, Malaysian risk managers and CFOs can clearly identify the potential risk. After Malaysia the UAE risk managers and CFOs can also identify the potential risk. On the other hand, Pakistani risk managers and CFOs are comparatively weak in identification of potential risk. The findings of this paper will be beneficial for the bankers, investors, depositors and policy makers to implement efficient risk monitoring techniques and to ensure the availability of well trained employees.

Suggested Citation

  • Riaz, Samina & Khan, Muhammad Irfan & Iqbal, Athar, 2018. "Risk Management Practices and Islamic Bankers’ Perception about Potential Risk in Islamic Countries," MPRA Paper 103103, University Library of Munich, Germany, revised 20 Dec 2018.
    • Handle: RePEc:pra:mprapa:103103
    as

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    References listed on IDEAS

    as
    1. Mohamed Ariff & Munawar Iqbal, 2011. "Introduction to Islamic Financial Institutions," Chapters, in: Mohamed Ariff & Munawar Iqbal (ed.), The Foundations of Islamic Banking, chapter 1, Edward Elgar Publishing.
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    3. repec:eme:jfrcpp:jfrc-07-2016-0055 is not listed on IDEAS
    4. Sania Khalid & Shehla Amjad, 2012. "Risk management practices in Islamic banks of Pakistan," Journal of Risk Finance, Emerald Group Publishing, vol. 13(2), pages 148-159, February.
    5. Rudra Sensarma & M. Jayadev, 2009. "Are bank stocks sensitive to risk management?," Journal of Risk Finance, Emerald Group Publishing, vol. 10(1), pages 7-22, January.
    6. Hameeda Abu Hussain, 2012. "Risk management practices of conventional and Islamic banks in Bahrain," Journal of Risk Finance, Emerald Group Publishing, vol. 13(3), pages 215-239, May.
    7. Shehriyar Khalil & Liaqat Ali, 2015. "Risk Management Practices in the Conventional Banks Working in Peshawar," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 5(2), pages 53-58, April.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Risk management; Islamic banks; liquidity risk; credit risk; operational risk; market risk;
    All these keywords.

    JEL classification:

    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • Z00 - Other Special Topics - - General - - - General

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