Risk Management of Musyarakah Mutanaqisah Contract in Sharia Banks in Indonesia: Legal and Operational Issues

This paper discusses how to solve problems occurring in the risk management of musyarakah mutanaqisah contract on home financing in sharia banks in Indonesia, particularly on its legal and operational issues. This study used a qualitative method using library data collection techniques and interviews. The study found that legal and operational risk management issues could be satisfactorily resolved by agreement of rescheduling, adding new conditions, and using new structures in accordance with Islamic teachings and applicable positive laws. In addition, ownership proof of some is needed to minimize the risk for the bank and the customer.

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Impact of Ownership and Size on Operational Risk Management Practices: A Study of Banks in India

Global Business Review ◽

10.1177/0972150917692207 ◽

2017 ◽

Vol 18 (3) ◽

pp. 795-810 ◽

Cited By ~ 2

Author(s):

Deepak Tandon ◽

Yogieta S. Mehra

Keyword(s):

Risk Management ◽

Factor Analysis ◽

Data Collection ◽

Management Practices ◽

Operational Risk ◽

Test Reliability ◽

Operational Risk Management ◽

Data Collection And Analysis ◽

Loss Data ◽

The Impact

The financial crisis and resulting failure of large banks worldwide has shaken the entire world. Improper management of operational risk has been touted as one of the reasons for this failure. In light of the rising importance of operational risk management (ORM) in banks, the study explores the range of ORM practices followed by a cross section of Indian banks and compares them with the banks worldwide. The study also analyses the impact of size and ownership of banks on these practices. Reliability analysis using Cronbach alpha model, Kaiser–Meyer–Olkin (KMO) measure of sampling adequacy and Bartlett’s test of sphericity was used to test reliability of questionnaire and justifies the use of factor analysis. Factor analysis was performed to extract the most important variables in ORM. The small size of bank was observed to be a deterrent to deep involvement of operational risk functionaries, collection and usage of external loss data and data collection and analysis. Further, the performance/preparedness of public sector and old private sector banks lagged behind peers in usage of key reporting components, such as risk and control self-assessment (RCSA), key risk indicators (KRI), scenarios, collection and usage of external loss data, data collection and analysis and quantification and modelling of operational risk.

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MANAJEMEN RISIKO OPERASIONAL PADA LEMBAGA AMIL ZAKAT NASIONAL

Jurnal Ekonomi Syariah Teori dan Terapan ◽

10.20473/vol6iss201911pp2236-2251 ◽

2020 ◽

Vol 6 (11) ◽

pp. 2236

Author(s):

Muhammad Fitrahuddin Ajmal Nazir ◽

Muhammad Nafik Hadi Ryandono

Keyword(s):

Risk Management ◽

Qualitative Method ◽

Operational Risk ◽

Case Study Approach ◽

Descriptive Data ◽

Operational Risk Management ◽

Know How ◽

Analysis Techniques ◽

Study Approach

The purpose of this study is to know how the national zakat institution manage their operational risk. Things that needs to be reviewed in the operational risk management based on the phenomenon that occurs in the research objects. The objects of this research is three national zakat institution with head office in Surabaya, which three national zakat institution is Yatim Mandiri, Nurul Hayat and YDSF. This research uses qualitative method with case study approach. After the interview, the results of the study were analyzed using descriptive data analysis techniques. The results of research conducted by researchers to three respondents, that operational risk management already performed by three national zakat institution based on their own way. There are 14 risks that identified. How the national zakat institution manage their risks depends on experiences of each national zakat institution itself.Keywords: Risk, Zakat, Operational Risk Management, National Zakat Institution

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