Islamic Banking menagement, assets and libilities

Keywords :Islamic banking, ALM, Capital adequacy, Risk management

1. Introduction

Assets and Liabilities Management (ALM) consists of technical instruments and methods, which consider both value creation and controlling of risks for shareholders. Since one of the main duties of banks’ financial management is ALM. Therefore, banks apply ALM techniques to increase more benefits by covering themselves from risks and minimize losses coming from transactions. The appropriate assessment of a bank's ALM requires a deep understanding of assets and liabilities, customers, economic environment, and competitive conditions of the bank. Thus prior to going through into Islamic banking respects of assets and liabilities, it is necessary to introduce Islamic banking assets and liabilities structures, market, customers, and other effective factors on ALM.