Probing Risk of Default in the Market-Leading Islamic Banking Industry: During the Covid-19 Pandemic

Mehreen, M. and Marimuthu, M. and Abdul Karim, S.A. and Jan, A. (2022) Probing Risk of Default in the Market-Leading Islamic Banking Industry: During the Covid-19 Pandemic. Studies in Systems, Decision and Control, 382. pp. 63-73.

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Abstract

This study aims to highlight the bankruptcy-related challenges and the reasons behind bank failures for the global Islamic banking industry, and to understand the expected impact of Covid-19 on the financial health of the Islamic banking industry. Moreover, the study shows that going bankrupt is a costly process that affects all stakeholders. Evidence shows that in the case of Islamic banking, a Shariah-based bankruptcy prediction model for apprehending the true bankruptcy prediction is over-sighted. It may further sour the existing uncertain situation for the Islamic banking industry with the additional unfavorable impact of Covid-19. As the subjected pandemic has badly affected the flow of the financial system worldwide, Islamic banking is not isolated. Therefore, efficient bankruptcy prediction models equipped with the latest micro and macro-economic factors are compulsory for the sustainability of the Islamic banking industry. © 2022, Institute of Technology PETRONAS Sdn Bhd.

Item Type: Article
Impact Factor: cited By 0
Depositing User: Ms Sharifah Fahimah Saiyed Yeop
Date Deposited: 17 Mar 2022 02:21
Last Modified: 17 Mar 2022 02:21
URI: http://scholars.utp.edu.my/id/eprint/28849

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