“Evaluation of the Financial Performance of Islamic Banks in Bangladesh”

Abstract

This paper aims to determine the factors that effect on evaluation of the financial performance of Islamic Banks in Bangladesh. In South Asia, Bangladesh is a well-known hub for Islamic banking. Iran introduced Islamic banking in 1983, and today, Islamic banks account for about one-fifth of the country's banking market share. Very nothing is known about its shari'ah-based governing structure. In Bangladesh, there is no specific law that regulates Islamic banking. Both conventional and Islamic banks are governed by Bangladesh Bank (BB), the country's central bank. Researchers and the international Islamic banking community have taken notice of BB's most recent instructions on the operation of Islamic banking in Bangladesh (BMB Islamic, 2011). This is so that an Islamic bank is not required by these regulations to have a shari'ah supervision committee.As a result, this paper investigates Bangladesh's shari'ah governance framework for Islamic banking, analyzes its problems and difficulties, and offers concrete suggestions for further improvement. This study first offers a definition of shari'ah governance, an introduction to its research methodology, and information on how Islamic banking has evolved in Bangladesh. The shari'ah governing structure is next discussed, along with any related problems or difficulties, and finally, improvements are suggested.