SOCIAL AND ECONOMIC DEVELOPMENT PERFORMANCE OF ISLAMIC BANKS: IDEALS AND REALITY

Abstract

Social and economic development performance of Islamic banks is very critical subject that concerns both academics and practitioners in the area of Islamic banking and finance industry. This conceptual paper starts with an overview of historical development of Islamic banks, followed by a review of the topic of social and economic development performance of Islamic banks by looking at the sources of Islamic banking and finance ideals, the regulations related to the issue, the financing modes of Islamic banks and its impact on the social and economic development performance of Islamic banks, and the effect of the current corporate governance practices on the social and economic development performance of Islamic banks. The paper concludes with recommendations for Islamic banks to improve their social and economic development performance in the future.

Keywords: Islamic Banks, Social Performance, Economic Development Performance, Islamic Banking and Finance Ideals, Corporate Governance of Islamic Banks