IDEAS home Printed from https://ideas.repec.org/p/ris/irtiop/0252.html
   My bibliography  Save this paper

The impact of credit risk transfer on Islamic banks lending behavior and financial stability (Research Paper)

Author

Listed:
  • Elzahi Saaid Ali, Abd Elrahman

    (The Islamic Research and Teaching Institute (IRTI))

Abstract

The recent financial crisis has further emphasized the importance of investigating the application of risk management techniques in Islamic banks. Previous conventional studies have showed that banks can be less risk averse in their credit portfolio management when they apply any sort of risk transfer techniques. In this study, data from 60 Islamic banks have been collected and analyzed in a panel pooled framework to investigate the impact of credit risk transfer (CRT) techniques on the lending behavior of Islamic banks. Results have showed that Islamic banks may expand their lending portfolios when practicing some sort of credit risk transfer techniques. These results are consistent with the results achieved in conventional banking studies. Hence the study concludes that despite the theoretical differences, Islamic banks may behave like conventional banks when using some sort of risk management methods. Given the recent global financial instability, the results of this study give strong policy implications to the Islamic banks management as well as to the regulators.

Suggested Citation

  • Elzahi Saaid Ali, Abd Elrahman, 2012. "The impact of credit risk transfer on Islamic banks lending behavior and financial stability (Research Paper)," Occasional Papers 252, The Islamic Research and Teaching Institute (IRTI).
    • Handle: RePEc:ris:irtiop:0252
    Note: This publication is available as free in PDF format for research purpose only. Authors are requested to include the publication reference in their citation whenever applicable. Apart from this can be also order as eBook or Printed format from IRTI website. Readers are requested to search the "title" of paper under publications page on IRTI website. http://www.irti.org/English/Pages/Publications.aspx
    as

    Download full text from publisher

    File URL: http://www.irti.org/English/Pages/Publications.aspx
    File Function: Full text
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ris:irtiop:0252. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Research Division (email available below). General contact details of provider: https://edirc.repec.org/data/irisbsa.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.