 Cooperative and Islamic Banks: What can they Learn from Each Other?Saeed Al-Muharrami and Daniel Hardy No 2013/184, IMF Working Papers from International Monetary Fund Abstract: Islamic and cooperative banks such as credit unions are broadly similar in that they both share some risk with savers. However, risk sharing goes along with ownership control in cooperatives, whilst Islamic banks share risk with borrowers and downside risk with depositors. Islamic banking is consistent with mutual ownership, which may ease some of the governance and efficiency concerns implied by Shari’ah constraints. Greater risk sharing among cooperative bank stakeholders, using mechanisms embedded in Islamic financial products, may strengthen cooperatives’ financial resilience. Keywords: WP; Islamic bank; physical asset; bank management; central bank; total return; Islamic Banks; Cooperative Banks; Credit Unions; Profit and Loss Sharing; Mutualization; credit union customer account; bank financing; return on equity; profit-maximizing bank; bail in; region bank; capital structure; adverse selection; Credit bureaus; Islamic banking; Bank credit; Global; Europe (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:2013/184 Ordering information: This working paper can be ordered from Access Statistics for this paper More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC. |
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