Kamran Nadri; Layla Mehrabi
Volume 1, Issue 1 , September 2015, , Pages 1-37
Abstract
Islamic banks and financial institutions are faced with many constraints especially in relation to inter-banking transactions with other banks as well as conventional banks. Attaining the money-market instruments which are in accordance with Shari’ah (the religious law) are both limited and diverse ...
Read More
Islamic banks and financial institutions are faced with many constraints especially in relation to inter-banking transactions with other banks as well as conventional banks. Attaining the money-market instruments which are in accordance with Shari’ah (the religious law) are both limited and diverse in different Islamic countries. Meanwhile, the central bank's short-term financing instruments are often not compatible with the principles and rules of Shari’ah. Hence, with respect to the Islamic banks and financial institutions, the liquidity management by the central bank is still in its infancy and there are still some concerns over the idea whether the money in an Islamic perspective can fulfill its main duty, that is the coordination between the monetary section and the real section through controlling the money supply. Given the importance of this issue, steps have been taken in recent years to expand monetary policy tools in Islamic countries. Emphasizing the experience of countries such as Malaysia, Sudan, Indonesia, and Bahrain, this paper presents and reviews the structure and properties of the tools used by Islamic banks and financial institutions as well as by other banks in order to manage liquidity on the interbank market. Further, the central bank's tools for open market operations and government financial fulfillment in the interbank market are analyzed and finally the tools of the central banks and governments to grant credit facilities as the final lender are discussed.
Mohsen Khoshtinat; Mohammad Omidinejad; Monireh Rezvanian
Volume 1, Issue 2 , March 2016, , Pages 1-27
Abstract
Insolvency risk of banks accounted for a large part of the banking literature, especially after the global financial crisis and the subsequent widespread bankruptcies of the banks is of great importance. Most banks and credit institutions face with financial insolvency due to the lack of portfolio diversification ...
Read More
Insolvency risk of banks accounted for a large part of the banking literature, especially after the global financial crisis and the subsequent widespread bankruptcies of the banks is of great importance. Most banks and credit institutions face with financial insolvency due to the lack of portfolio diversification of financing structure, lending large amount of loans to a particular industry or economic sector, and the lack of management and control of risks before they come into existence. Since the failure of the financial sector especially banks undermine public confidence in the financial system and as a result devastating effects is transferred on the entire economy, studying factors influencing the risk of insolvency is very important. Hence, the present study uses panel data model (unbalanced panel) and Generalized Least Squares (GLS) to test the effectiveness of the financing structure, credit risks, interest rate risk on insolvency risks of banks. Research data include financial information of 10 commercial public banks, private, and privatized banks under Article 44 during the priod of 2001 to 2012. The results show that specialization financing structure variable has a significant and direct effect on the risk of bank insolvency, while financing structure stability variable over the medium term (mid-term policy of banks lendings) has reverse and significant effect on the risk of bank insolvency. Also, the effect of interest rate risk, credit risk and liquidity risk on bank insolvency risk is significant and positive.
Mohammad Nabi Shahiki Tash; Zohreh Abyari
Volume 2, Issue 3 , September 2016, , Pages 1-31
Abstract
Considering the trend of privatization of state-owned banks in Iran, it is important to know the effects of privatization on the performance of banks of which ownership has transferred to private sector. Thus, this research attempts to compare the technical efficiency and productivity of Iranian banks, ...
Read More
Considering the trend of privatization of state-owned banks in Iran, it is important to know the effects of privatization on the performance of banks of which ownership has transferred to private sector. Thus, this research attempts to compare the technical efficiency and productivity of Iranian banks, before and after privatization. The studied sample includes 6 state-owned banks, 5 state-owned banks which their ownership has transferred to the private sector and 7 privately owned banks in the period of 2007-2011. Data Envelopment Analysis (DEA), Malmquist Productivity Index and Panel Data (Combined Time Series) were used with the help of DEAP and Evewis software. In order to determine the input and output variables, 2 different models have been selected based on an intermediary perspective: the income approach and the value-added approach. The findings of the statistical analyses suggest that bank productivity has grown after privatization. Managerial efficiency of privatized banks has dropped in the income approach after privatization and managerial efficiency of privatized banks has increased in the value-added approach. In fact, the performance of these banks has improved in mobilizing resources. The results of panel regression model suggest that private ownership, bank size and the visual deposit to total deposits ratio is positively related to technical efficiency and the deferred claims to facility ratio is negatively related to technical efficiency.
Mehdi Sadegi; Mahmud Khatib
Volume 2, Issue 4 , August 2017, , Pages 1-36
Abstract
The purpose of this study is to identify the criteria of venture capital (VC) financing and to determine the importance of each criterion in VC financing and finally to use TOPSIS method to rank Islamic contracts in VC financial systems. To rank the contracts, 8 criteria were identified through literature ...
Read More
The purpose of this study is to identify the criteria of venture capital (VC) financing and to determine the importance of each criterion in VC financing and finally to use TOPSIS method to rank Islamic contracts in VC financial systems. To rank the contracts, 8 criteria were identified through literature review and research works in the related fields. Then, for calculating the ranking of each criterion and performing sensitivity analysis toward making proper decisions, both quantitative and qualitative techniques is used. Shannon Entropy, as a quantitative technique, was used to calculate the importance of criteria using a questionnaire completed by bank experts in Islamic contracts of VC. However, using a qualitative method, 3 different states were considered for the importance level of criteria. Finally, the ranking of Islamic contracts in the VC financial system was calculated using TOPSIS method.
Mohsen Khoshtinat; Seyedeh Nasim Alavi
Volume 3, Issue 5 , December 2017, , Pages 1-29
Abstract
This research aims to identify the influential components on LGD by using Tobit regression on institutional customers of the bank of Industry and Mine. In order to achieve this goal, LGD can be used to calculate the probability of default on the basis of the Basel II agreement. LGD is the amount of loss ...
Read More
This research aims to identify the influential components on LGD by using Tobit regression on institutional customers of the bank of Industry and Mine. In order to achieve this goal, LGD can be used to calculate the probability of default on the basis of the Basel II agreement. LGD is the amount of loss a bank faces when the borrowers default on loan repayment. To accomplish this goal, 204 of institutional customers of bank for an 8 years period (2007-2014) have been chosen as a sample. The results show a significant relation between loan amount, collaterals (excepted promissory notes), industry type and LGD, and no significant relation between loan maturities and LGD.
Mohammad Hossein Pourkazemi; Eldar Sedaghat Parast; Reza Dehpanah
Volume 3, 6, 7 , March 2018, , Pages 1-23
Abstract
The purpose of this study is identifying factors affecting the probability of loan default and forecasting default probability of non-corporate (natural) customers of Pasargad bank by means of neural networks method (NNM). Variables influencing creation of default were identified through investigating ...
Read More
The purpose of this study is identifying factors affecting the probability of loan default and forecasting default probability of non-corporate (natural) customers of Pasargad bank by means of neural networks method (NNM). Variables influencing creation of default were identified through investigating background studies and literature review. At the next step, data related to 470 customers were collected from a statistical population of 25342 people who received loans from Pasargad bank in Tehran region from 2013 to 2014. Results show that NNM could accurately forecast 92% of applicants default probability. According to NNM results, bad financial history or type of collateral have had more significant effect on default probability than the other input variables.
Majid Alirezaee; Mohammad Javad Mohagheghnia; Mohammad Ali Dehghan Dehnavi
Volume 4, Issue 8 , June 2018, , Pages 1-25
Abstract
This research investigates the effects of increase in the non-shared revenue share of total revenue on risks faced by Iranian banks over the years 2008-2014 using generalized method of moments (GMM). Data were collected from the balance sheets of 18 active banks as well as the central bank website. To ...
Read More
This research investigates the effects of increase in the non-shared revenue share of total revenue on risks faced by Iranian banks over the years 2008-2014 using generalized method of moments (GMM). Data were collected from the balance sheets of 18 active banks as well as the central bank website. To measure the risk four indicators including the volatility of return on equity, the volatility of asset returns, NPL and logarithmic index of stability are employed. The results show that increase in the non-shared revenue share of total revenue not only reduce the overall risk but also increase the stability and sustainability of the banks. In addition, analyzing sub hypothesis of this study shows that this effect is greater during the economic boom.
Ahmad Ghodselahi; Farid Tondnevis
Volume 4, Issue 9 , March 2018, , Pages 1-31
Abstract
Electronic commerce and the emersion of banking technology besides fee income development are the main drivers of banks in the route for the competitive development of electronic banking. As this kind of income is more advantageous to the banks and their stakeholders, they are focusing on this kind of ...
Read More
Electronic commerce and the emersion of banking technology besides fee income development are the main drivers of banks in the route for the competitive development of electronic banking. As this kind of income is more advantageous to the banks and their stakeholders, they are focusing on this kind of banking in their plans to achieve more competitive position which results in more market share. The purpose of this research is evaluating the competitive criteria of electronic banking in banking industry. The research is descriptive and the private bank experts are chosen as the statistical population. Data is gathered through customized questionnaire and the specified samples for filling this questionnaire are selected through non-random sampling. The data which its adequacy is evaluated through Bartlett's test and KMO measure is analyzed via confirmatory factor analysis. The goodness of fit is employed for evaluation of final model. The results demonstrate that some criteria combining as hard and soft kinds are effective in competitiveness of banks in electronic banking which highlights the importance of strategic leading for banks.
Reza Mohseni; Lagha Najafi
Abstract
By Collecting economic activists' savings banks can obtain huge capitals, and if directed properly, this can lead to production prosperity. Given the competitiveness in financial markets, the correct pricing of facilities and credits, and especially a correct evaluation of risks regarding the receivers ...
Read More
By Collecting economic activists' savings banks can obtain huge capitals, and if directed properly, this can lead to production prosperity. Given the competitiveness in financial markets, the correct pricing of facilities and credits, and especially a correct evaluation of risks regarding the receivers of financial facilities, the optimized allocation of risk costs for various kinds of facilities receivers based on risk is of utmost importance. Therefore, given the existing complexities in the activities and economic environments, the banks and other credit institutions should design and choose appropriate models to evaluate their clients' credit rates. In this paper, we focus on the financial criteria of the customers' credit risk as well as the relationships between the credit risks' criteria and measures and collecting debts. Thus, according to the theoretical fundamentals, as well as the empirical studies, using the financial ratios based on the interviews with elites, Bank Mellat managers, university experts, and some active organizations in the field of banking, we evaluate the credit volume allocated to the enterprise. Then, using the analytic hierarchy process (AHP), the components affecting the credits are ranked and analyzed based on a fuzzy expert system.
vali nadi ghomi; ُSoheil Jahanfar
Abstract
Overconfidence is one of the most common cognitive biases among managers and investors. Overconfident managers usually underestimate the risk of investments because of the illusion of control and make additional investments to continue expanding their business empire. In this study, the relationship ...
Read More
Overconfidence is one of the most common cognitive biases among managers and investors. Overconfident managers usually underestimate the risk of investments because of the illusion of control and make additional investments to continue expanding their business empire. In this study, the relationship between managerial overconfidence, internal financing, and investment efficiency is examined. This research is a type of post-event research and is based on the analysis of the observed data. The statistical sample included 148 companies listed on the Tehran Stock Exchange (TSE) and Iran Fara Bourse Securities Exchange (IFB) over 10 years (2008-2017). Data regression analysis, Panel data analysis, are used to determine the relationships. The results show that there is no positive and significant relationship between managerial overconfidence and internal financing. There is also a significant relationship between internal financing and investment efficiency, we concluded that managerial overconfidence has not got a significant effect on the relationship between internal financing and investment efficiency.
Mohammad Ali Dehghan Dehnavi; Fatemeh Rezazadeh Karsalarei; Oveise Moharram Oghli
Abstract
One of the strengths of Islamic banking compared to the conventional banking system is the participation in the profit and loss of financial activities within the framework of partnership contracts. Proper implementation of participatory facilities requires the observance of religious, financial, and ...
Read More
One of the strengths of Islamic banking compared to the conventional banking system is the participation in the profit and loss of financial activities within the framework of partnership contracts. Proper implementation of participatory facilities requires the observance of religious, financial, and economic requirements. However, the criticism and evidence concerning the performance of Islamic banks in the provision of participatory facilities indicate their inability to properly implement and comply with the judicial and legal requirements of such facilities. Therefore, due to the growing trend of non-performing loans and their relation to Islamic contracts, we examined the relationship between Islamic contracts and the credit risk of banks. To this end, the panel regression was employed to collect data from 14 banks listed in TSE in 2009-2018. The credit risk was also measured using the ratio of non-performing facilities and Islamic contracts (participatory and transactional) based on the share of contracts in total facilities. The results of this study show that participatory contracting has a direct relationship with the credit risk of banks and transactional contracting has no significant effect on the credit risk of banks. The return on assets and the bank size have a significant negative relationship with banks' credit risk.
Mahshid Shahchera; Alireza Dehgan Nayyeri
Abstract
Asset and liability management includes a set of specialized tools and techniques to create value for shareholders and control risk. The banking system is the heart of every economic system and its performance is affected by many factors such as liquidity risk. Some of the factors involved in liquidity ...
Read More
Asset and liability management includes a set of specialized tools and techniques to create value for shareholders and control risk. The banking system is the heart of every economic system and its performance is affected by many factors such as liquidity risk. Some of the factors involved in liquidity risk include non-performing loans, capital ratios, and bank size. In this research, we try to examine the relationship between the factors affecting liquidity risk and the indicators of the banking system affecting resource and cost management (equity ratio, return on assets and credit risk). In addition, we have evaluated the impact of macroeconomic variables on bank liquidity risk. Using an econometric model with generalized method of moment (GMM) as an estimation approach, we conclude that there are relationship between these variables (independent variables) and liquidity risk.
Yahya Hasas Yehaneh; Reza Habibi; Behzad Nazi
Volume 3, 6, 7 , March 2018, , Pages 25-58
Abstract
A healthy and profitable banking system can better resist against economic shocks, and play a more prominent role in financial system stability. Banks failure has disastrous effects on banking system and its effects spread on other banks and affects the whole economy. The main objective of this study ...
Read More
A healthy and profitable banking system can better resist against economic shocks, and play a more prominent role in financial system stability. Banks failure has disastrous effects on banking system and its effects spread on other banks and affects the whole economy. The main objective of this study is to investigate the impact of asset quality on financial distress in the country's banks. In this study, using financial ratios the effect of asset quality, payment facility and capital adequacy on financial distress indicators is examined. For this purpose, data from 18 banks during the years 1388 to 1394 are collected from Tehran Stock Exchange. Using the software EViews, data are analyzed using panel regression models. It is shown that the ratios of impaired loans to total loans and net charge offs to total loans have positive and significant effect on financial distress. The ratios of loan loss reserves to total loans and net loans to total assets have negative and significant effect on financial distress. Moreover, capital adequacy ratio has positive and significant effect on financial distress.
Seied Kazem Ebrahimi; Ali Bahraminasab; Mahnaz Azizi
Abstract
Due to the necessity of identifying the possibility of fraud in financial reporting for the purpose of helping the market and information users to optimize the allocation of financial resources, and because of the key role of fraud in losing credit, increasing ambiguity, reducing stock liquidity, and ...
Read More
Due to the necessity of identifying the possibility of fraud in financial reporting for the purpose of helping the market and information users to optimize the allocation of financial resources, and because of the key role of fraud in losing credit, increasing ambiguity, reducing stock liquidity, and reducing the fair allocation process in the market, which in itself widens the gap between shareholders, investors, the users of financial information, and managers, this study seeks to examine the effect of the probability of fraud on information asymmetry criteria in accepted banks in Tehran Stock Exchange. The statistical sample includes 15 accepted banks in Tehran Stock Exchange from 2012 to 2018 which would totally add up to 105 year-banks. This research adopts a multivariate linear regression model. The variables used as the information asymmetry criterion in this study include price gap and price impact. The findings uncover a meaningful and positive correlation between fraud, price gap, and price impact which by and of itself results in cultivating a positive and meaningful correlation between fraud and information asymmetry. In other words, as fraud probability increases, the information asymmetry increases too. The impact of fraud disclosure on information asymmetry undermines the company’s credibility and leads to growing uncertainty. Investors, in such conditions, doubt the dependability of investigation in the capital market, and constantly raise their required rate of return.
Seyed Fakhrodin Fakhrhoseini; Meysam Kaviani
Volume 4, Issue 8 , June 2018, , Pages 27-49
Abstract
The impact of geographical diversification on the performance of banks is a question that banks always face, and one of the daily issues to respond. This study also seeks to answer the question of how geographic diversification affects the performance of banks accepted in Tehran Stock Exchange. Twelve ...
Read More
The impact of geographical diversification on the performance of banks is a question that banks always face, and one of the daily issues to respond. This study also seeks to answer the question of how geographic diversification affects the performance of banks accepted in Tehran Stock Exchange. Twelve banks sampled by systematic sampling method were examined during the period 2011 to 2015. To examine the geographical diversification a number of cities in which the bank has been active until the year t (excluding the cities with headquarter) are chosen and the performance is measured by market share, net interest income, cost-to-income ratio, return on assets and non-interest income share. The results of model estimation show that geographical diversification has a significant effect on market share of bank and non-interest income.
nasrin motedayen; rafick nazarian; roya seifi pour; marjan daman keshideh
Abstract
The purpose of this study is to validate customers and the impact of its components on non-current receivables of Bank Mellat. For this purpose, in the first stage, first, by using the documentary and library method, 15 indicators affecting the validation of customers in three sections: individual, financial ...
Read More
The purpose of this study is to validate customers and the impact of its components on non-current receivables of Bank Mellat. For this purpose, in the first stage, first, by using the documentary and library method, 15 indicators affecting the validation of customers in three sections: individual, financial and social identified, and then the final data related to the indicators, including the files of 7330 real customers of Bank Mellat, were collected during 2013-2019. To study the credit rating indicators of customers and the impact of its components on non-current receivables of Bank Mellat, multiple logistic regression was used in four categories of timely receipt, past due, delinquent and doubtful receivables. The results showed that in general, individual, social, and economic conditions affecting the credit of real customers have a significant effect on reducing the non-current receivables of Bank Mellat. Using the results of research model estimation can help bank managers and monetary and banking policymakers to make the right decision regarding customers' credit ratings and reduce banks' non-current receivables.
Azam Ahmadian; Hadi Haydari; Hossein Haydari
Volume 1, Issue 2 , March 2016, , Pages 29-56
Abstract
In this paper we examined the effects of inflation targeting regime based on the contents of Iranian banking system financial statements during the period of 1981-2014 using Dynamic Stochastic General Equilibrium (DSGE) model. To estimate DSGE parameters, calibration method was utilized. Moments of the ...
Read More
In this paper we examined the effects of inflation targeting regime based on the contents of Iranian banking system financial statements during the period of 1981-2014 using Dynamic Stochastic General Equilibrium (DSGE) model. To estimate DSGE parameters, calibration method was utilized. Moments of the data and Impulse Response Function analyses were used for model verification. The results show that the profit rate shock increases the liquidity sources of banks and as a consequence, bank lending causes an improvement in the investment and production and a decrease in inflation rate. However, inflation targeting for the purpose of reduction in deposit and loan profit rates results in reduction in bank resources and at the same time jeopardizes the soundness of banks. So, we suggest that inflation targeting regime should be combined with the policy of increasing profit rates.
Hasan Golmoradi; Reza Mohseni; Hossein Golmoradi
Volume 3, Issue 5 , December 2017, , Pages 31-52
Abstract
Today, banking system plays a very important role in growth and development of countries. From the very beginning of banks establishment, they have two main and traditional tasks, namely, the equipping and allocation of resources. These two important tasks are implemented so that they collect the people's ...
Read More
Today, banking system plays a very important role in growth and development of countries. From the very beginning of banks establishment, they have two main and traditional tasks, namely, the equipping and allocation of resources. These two important tasks are implemented so that they collect the people's deposits on one hand and put it in various forms of allocation, on the other hand. In performing these tasks, banks face different internal and external barriers that affect their responsibilities. One of the external factors affecting the banking system is the volatile environment of economy and macroeconomic uncertainty. The macroeconomic instability and uncertainty ultimately reflect into two main variables of each economy, namely, production and inflation. This research seeks to investigate the effect of uncertainty and instability of macroeconomic variables (production and inflation) on the resources and expenditures of Iran banking system using GARCH techniques and Error Correction Model (ECM). The results of the research show that the effect of instability and uncertainty of production growth on the growth of resources of the banking system (resource mobilization) is negative and significant and on the allocation of resources (growth of credits) is positive and significant, resulting in increasing the banks' credit risk. Moreover, in this study, the significance of the negative effect of instability of inflation on resource absorption and its positive effect on allocation of resources are not accepted.
Mohammad Reza Heydari; Sayed Mohammad Fatemi Varzaneh
Volume 2, Issue 3 , September 2016, , Pages 33-62
Abstract
Banking system is of great importance in many countries. This system can provide effectiveness in the economy with the proper circulation of money and in the case of improper functioning, the activities of other economic sectors will face difficulties. Although banking without lucre has progresses in ...
Read More
Banking system is of great importance in many countries. This system can provide effectiveness in the economy with the proper circulation of money and in the case of improper functioning, the activities of other economic sectors will face difficulties. Although banking without lucre has progresses in theoretical field, but competitiveness ability and its operational aspects is limited in transnational level. Many factors affect on this issue; lack of alignment with Islamic banking standards and operational rules of Basel Committee, political factors such as sanctions and contract compliance risk are challenges that have limited Iranian banking system in communication with other financial institutions and also has limited the improvement of indicators quality. This paper has conducted using a descriptive-analytical method and collecting library and documentary information, and studied the private banks performance of Islamic republic of Iran and Islamic banks of Persian Gulf region, based on CAMEL indexes. The results show that selected Islamic banks in terms of capital adequacy, credit risks, management quality index and liquidity index are in better situation compared to private banks in Iran.
Reza Habibi; Hasan Kouhi; Hosein Baidi
Volume 4, Issue 9 , March 2018, , Pages 33-71
Abstract
Given the nature of banking industry activities, which mainly relate to the allocation of resources, credit risks are increasingly faced by this industry. Therefore, knowing the origin of credit risk and its estimation are always fundamental issues for this industry. In this regard, in order to solve ...
Read More
Given the nature of banking industry activities, which mainly relate to the allocation of resources, credit risks are increasingly faced by this industry. Therefore, knowing the origin of credit risk and its estimation are always fundamental issues for this industry. In this regard, in order to solve this problem in Bank Sepah, this study aims to identify the features effective to credit risk of real customers of Bank Sepah as well as to design a model to predict the probability of credit risk default by employing genetic algorithm and probit regression models. The data of this research is gathered using the credit facilities paid to persons in 2016. Among all the credit facilities paid to real people in 2016, two samples each of size 3600 (for fitting the model) and two sample each of size 400 (in order to verify the model by the ROC curve) were randomly selected. Meanwhile, MATLAB software has been used to analyze the data. The result of the study shows that the genetic algorithm (GA) method has the ability to determine the variables in three difference levels based on the degree of importance. The results also show that area under the ROC curve in the GA method is equal to 0.92 but in the probit regression method, it is equal to 0.72 demonstrating the higher ability to predict the likelihood of facility failure in the GA method compared to the probit regression method. The results of the ROC curve verification show that the GA correctly predicts 91.8% of cases compared to 90.0% in probit regression.
Hamed Jiani Rezaei; Siavash Golzarianpour; Majid Mahian
Volume 2, Issue 4 , August 2017, , Pages 37-65
Abstract
Since the banks are important influential sections in the development of every country, it is important to evaluate their performance. Data Envelopment Analysis (DEA) is one of the common tools used for evaluating banks performance. The focus of this paper is mainly to evaluate the efficiency of ...
Read More
Since the banks are important influential sections in the development of every country, it is important to evaluate their performance. Data Envelopment Analysis (DEA) is one of the common tools used for evaluating banks performance. The focus of this paper is mainly to evaluate the efficiency of decision making units over a specific time period. To analyze the changes in efficiency, Window DEA based on the input-oriented model is used under the assumption of non-decreasing return to scale (NDRS). This research identified the most efficient and inefficient 3rd degree branches of Bank Sepah in Mashhad during 2008 to 2013. Input included personnel costs and the total deposits attracted, and output included granted loans and the amount of gross profit of branches. Based on the results of window analysis, 6 out of 39 3rd degree branches of Bank Sepah in Mashhad had an average efficiency of 1. In addition, 70% of 3rd degree branches of Bank Sepah had efficiencies of over 0.72 and also their average efficiency was 0.78 during 6 years. It is notable to mention that 70% of these branches enjoy the efficiency of over 0.80 with an average efficiency of 0.87 in four windows.
Abbas Karimi; Yaser Moradi
Volume 1, Issue 1 , September 2015, , Pages 39-70
Abstract
Today banks use different methods to grant facilities to their customers. For instance, there has been a significant growth in using civil partnership contracts, among other contracts, in recent years for various reasons. Participation is one of the methods of financing economic activity approved ...
Read More
Today banks use different methods to grant facilities to their customers. For instance, there has been a significant growth in using civil partnership contracts, among other contracts, in recent years for various reasons. Participation is one of the methods of financing economic activity approved by the Islamic banking, which according to its legal basis, involves the merger of capitals of partners, and all partners have the right to interfere and monitor its economic activity and management. Among the basic concepts of partnership contract is division of the benefits and losses at the end of the business or contract, depending on the amount of capital investment by each of them. However, the question arises whether in the bank's contracts with its customers, the stipulation of conditions of the contract by the bank, may lead to abusing of the superioriority and exploitation of customers so as to impose on them conditions contrary to the principles of Islamic banking. In this research, an attempt is made to answer these questions, and deal with all of the conditions of the contracts for civic partnership in banks, comparing them with those of the European Union. The results suggest that in regards with dividing the benefits and loss, the obligation of contract in its license for the Bank, requiring the customer to buy partnership shares, are imposing conditions mentioned in the contract. However, the European Union does not prescribe any such conditions against the customers.
Yaser Moradi
Abstract
Nowadays, the increase in bank debts has become one of the country's severe economic crises, and collecting these debts has turned into one of the major concerns for the country's banking network. Therefore, the question arises as to the reasons for the failure of banks to collect these debts. According ...
Read More
Nowadays, the increase in bank debts has become one of the country's severe economic crises, and collecting these debts has turned into one of the major concerns for the country's banking network. Therefore, the question arises as to the reasons for the failure of banks to collect these debts. According to the findings of this study, the disruption in the set of laws and regulations governing debt collection of the credit institutions is the leading cause of this critical situation, and at the same time, improper interpretation and misapplication of minimum rules by courts and some negligence in bank branches intensifies this dilemma. The first step to improve this situation is to provide banking facilities supported by easy-to-sell collaterals; a solution that has been seriously threatened in the laws passed in the 80's. The second step is the implementation of Note 4 supplementary to the Article 34 of the Registration Law, approved in 2015, and the obligation of the judiciary to amend the bylaws for the implementation of the provisions of official documents in this regard and also the annulment of the verdict No. 266 of the General Assembly of Administrative Justice Court, which, by misinterpreting the tax laws in practice, has eliminated the right of priority arising from a bank mortgage. The third step is to remove barriers to the collection of banks' debts in courts, including the possibility of referring bank cases to arbitration, establishing specialized branches across the country and amending bankruptcy regulations with the goal of preventing the formation of fictitious bankruptcies by bank debtors.
Abdollah Pakdel Moghanlo; Hasan Kouhi; Sanam Rahimzadeh Kolahi
Abstract
The purpose of this study is to examine the relationship between bank profitability, bankruptcy and credit risk and selected bank sector variables. The study population includes banks accepted in Tehran Stock Exchange from 2009 to 2017. To test the research hypotheses, dynamic panel data model has been ...
Read More
The purpose of this study is to examine the relationship between bank profitability, bankruptcy and credit risk and selected bank sector variables. The study population includes banks accepted in Tehran Stock Exchange from 2009 to 2017. To test the research hypotheses, dynamic panel data model has been used. The results of hypotheses testing indicate that there is a negative and significant relationship between the asset returns of the previous year, cash assets to total assets and the exchange rate with the return on assets. There are positive and significant relationships between the capital adequacy rate as well as inflation rate and the rate of return on assets of banks, between both cash assets to total assets and exchange rate and the return on equity ratio; and vice versa between the economic growth rate as well as inflation rate and the rate of return on salaries. There is a negative and significant relationship between cash assets to total assets, exchange rate and inflation rate and banks' bankruptcy risk. There is a positive and significant relationship between the economic growth rate and banks' bankruptcy risk and there is a positive and significant relationship between credit risk of the previous year, capital adequacy and credit risk of banks, and ultimately there is a negative and significant relationship between net assets and credit risk of banks.
Mohammad Naghi Nazarpour; Abbas Dadjouye Tavakoli
Volume 4, Issue 8 , June 2018, , Pages 51-80
Abstract
Using a descriptive-analytical method, this study proposes a new method to make profit from forfeited properties that can be employed by the banking system to provide cheap financing. The main hypothesis of this study contends that Murabaha bonds for providing liquidity along with their derived instruments ...
Read More
Using a descriptive-analytical method, this study proposes a new method to make profit from forfeited properties that can be employed by the banking system to provide cheap financing. The main hypothesis of this study contends that Murabaha bonds for providing liquidity along with their derived instruments such as legitimate put and call options, with a controlled return risk, can help banks with the frozen profit of forfeited properties and provide cheap financial resources, compared to the current state of the money market. Banks can use this method to sell such assets based on the market rate (calculated through discovering the prices in commodities exchange) and using Murabaha bonds, while postponing the delivery of properties up to two years. This will provide them with the much needed liquidity while taking advantage of the rent until the deadline for delivery, before which, the banks will be entitled to rent out the property according to the contract. At the delivery time, the property will either be handed over to the intermediate company (SPV) to be sold in the market and the sums divided among bond holders; or the manner of final settlement will be determined by granting the rights for call option and put option respectively to the bank and the intermediate company on behalf of the bond holders. Considering that there is no obligation in call and put options as a second contract, Murabaha contract will not lead to Ba'i al-'Ayn (sales in cash of a property just bought on installment).
