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The Application of Musyarakah Floor Stocking-i: A Case Study of Bank Muamalat Malaysia Berhad

In Islamic banking, there are two major modes of financing namely via debt and equity respectively. It was reported that most of the financial institutions in Malaysia are applying the former model of financing in their products such as Bay' al-Inah, Murabahah, Bay' Bithaman Ajil, Tawarru...

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Main Authors: Mohamad Nizam Jaafar, Muhammad Saiful Islami Mohd Taher, Mohd Faizal Kamarudin
Format: Article
Language:English
Published: Universiti Sains Islam Malaysia 2012
Subjects:
Equity financing
Musyarakah floor stocking-i
Bank Muamalat Malaysia Berhad
Online Access:http://ddms.usim.edu.my/handle/123456789/5385
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spelling my.usim-53852015-03-02T06:36:59Z The Application of Musyarakah Floor Stocking-i: A Case Study of Bank Muamalat Malaysia Berhad Mohamad Nizam Jaafar Muhammad Saiful Islami Mohd Taher Mohd Faizal Kamarudin Equity financing Musyarakah floor stocking-i Bank Muamalat Malaysia Berhad In Islamic banking, there are two major modes of financing namely via debt and equity respectively. It was reported that most of the financial institutions in Malaysia are applying the former model of financing in their products such as Bay' al-Inah, Murabahah, Bay' Bithaman Ajil, Tawarruq and etc as compared to the latter model of financing i.e. Musyarakah and Mudarabah. The main reason for financial institutions avoiding equity financing is mainly due to their profit oriented objective which attribute to avoiding the element of moral hazard, loss and dishonesty respectively which could be apparently found in the equity mode of financing. Nevertheless, most of the Islamic scholars are very much preferred equity financing as it seems to reflect most faithfully principles of the Shariah. In other word, the equity financing makes the nature of Islamic banking more visible. In addition, Islamic finance also stands for a system of equity sharing and stake taking and it operates on the principle of variable return based on actual productivity and the performance of the projects. Despite high risk features in the equity financing, Bank Muamalat has successfully introduced as such model under the product of Musyarakah Floor Stocking. Therefore, this paper will perform general preview on Musyarakah financing and conceptual analysis on the Bank Muamalat Musyarakah Floor Stocking which is applying profit sharing principle. 2012-03-12T04:19:37Z 2012-03-12T04:19:37Z 2010 Article 1823075X http://ddms.usim.edu.my/handle/123456789/5385 en vol.7 no.1 2010; Universiti Sains Islam Malaysia
institution Universiti Sains Islam Malaysia
building USIM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universit Sains Islam i Malaysia
content_source USIM Institutional Repository
url_provider http://ddms.usim.edu.my/
language English
topic Equity financing
Musyarakah floor stocking-i
Bank Muamalat Malaysia Berhad
spellingShingle Equity financing
Musyarakah floor stocking-i
Bank Muamalat Malaysia Berhad
Mohamad Nizam Jaafar
Muhammad Saiful Islami Mohd Taher
Mohd Faizal Kamarudin
The Application of Musyarakah Floor Stocking-i: A Case Study of Bank Muamalat Malaysia Berhad
description In Islamic banking, there are two major modes of financing namely via debt and equity respectively. It was reported that most of the financial institutions in Malaysia are applying the former model of financing in their products such as Bay' al-Inah, Murabahah, Bay' Bithaman Ajil, Tawarruq and etc as compared to the latter model of financing i.e. Musyarakah and Mudarabah. The main reason for financial institutions avoiding equity financing is mainly due to their profit oriented objective which attribute to avoiding the element of moral hazard, loss and dishonesty respectively which could be apparently found in the equity mode of financing. Nevertheless, most of the Islamic scholars are very much preferred equity financing as it seems to reflect most faithfully principles of the Shariah. In other word, the equity financing makes the nature of Islamic banking more visible. In addition, Islamic finance also stands for a system of equity sharing and stake taking and it operates on the principle of variable return based on actual productivity and the performance of the projects. Despite high risk features in the equity financing, Bank Muamalat has successfully introduced as such model under the product of Musyarakah Floor Stocking. Therefore, this paper will perform general preview on Musyarakah financing and conceptual analysis on the Bank Muamalat Musyarakah Floor Stocking which is applying profit sharing principle.
format Article
author Mohamad Nizam Jaafar
Muhammad Saiful Islami Mohd Taher
Mohd Faizal Kamarudin
author_facet Mohamad Nizam Jaafar
Muhammad Saiful Islami Mohd Taher
Mohd Faizal Kamarudin
author_sort Mohamad Nizam Jaafar
title The Application of Musyarakah Floor Stocking-i: A Case Study of Bank Muamalat Malaysia Berhad
title_short The Application of Musyarakah Floor Stocking-i: A Case Study of Bank Muamalat Malaysia Berhad
title_full The Application of Musyarakah Floor Stocking-i: A Case Study of Bank Muamalat Malaysia Berhad
title_fullStr The Application of Musyarakah Floor Stocking-i: A Case Study of Bank Muamalat Malaysia Berhad
title_full_unstemmed The Application of Musyarakah Floor Stocking-i: A Case Study of Bank Muamalat Malaysia Berhad
title_sort application of musyarakah floor stocking-i: a case study of bank muamalat malaysia berhad
publisher Universiti Sains Islam Malaysia
publishDate 2012
url http://ddms.usim.edu.my/handle/123456789/5385
_version_ 1645151659856232448
score 13.222552

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