A Note: Debt Selling and Their Impact on Islamic Bank Value

• Main Authors: Ismail, Abdul Ghafar, Kamil, Karmila Hanim
• Format: Article
• Language: English
• Published: Universiti Utara Malaysia 2010
• Subjects: HG Finance
• Online Access: http://repo.uum.edu.my/25066/1/IJBF%20%207%201%202010%20161%20170.pdf; http://repo.uum.edu.my/25066/; http://ijbf.uum.edu.my/index.php/previous-issues/139-the-international-journal-of-banking-and-finance-ijbf-vol-7-no-1-feb-march-2010
• Institution: Universiti Utara Malaysia

This paper shows how a risk management mechanism through selling debt can affect the value of Islamic banks. Islamic banks are able to maximize their value from the sale of murabahah on housing debt in order to manage their risk arising from fluctuations in interest rates. A tractable theoretical mo...