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Islamic interbank money market: contracts, instruments and their pricing

Saiti, Buerhan and Hasan, Aznan and Engku Ali, Engku Rabiah Adawiah (2016) Islamic interbank money market: contracts, instruments and their pricing. In: Islamic capital markets: volatility, performance and stability. Palgrave CIBFR Studies In Islamic Finance . Palgrave Macmillan, AG Switzerland, pp. 67-100. ISBN 978-3-319-33990-0

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Abstract

This chapter discusses the Islamic interbank money market, its instruments and operations. The discussion demonstrates that the existence of a viable Islamic interbank money market is crucial for the successful implementation of an Islamic financial system. The chapter examines the various interbank money market instruments, their underlying Islamic contracts and their pricing mechanisms, with appropriate examples. The availability of various Islamic interbank money market instruments allows Islamic banks to cover their exposure (in case of deficit) and make placement on short­term basis (in case of surplus). Moving forward, a greater variety of instruments with fixed return mechanisms and tradability features, which at the same time invite fewer Shariah issues, must be offered in the market to ensure a more vibrant Islamic interbank money market.

Item Type: Book Chapter
Additional Information: 7451/51470
Uncontrolled Keywords: Islamic finance, Islamic interbank money market, Islamic contracts, Pricing
Subjects: H Social Sciences > HG Finance
Kulliyyahs/Centres/Divisions/Institutes: Institute of Islamic Banking & Finance (IIiBF)
Depositing User: ASSOC PROF DR BUERHAN SAITI
Date Deposited: 05 Aug 2016 11:20
Last Modified: 16 Jan 2017 12:14
URI: http://irep.iium.edu.my/id/eprint/51470

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