Research Objectives

To explore the elements of financial risk through detail literature survey.

To investigate the key factors affecting credit risk in IBs.
To investigate the key factors affecting liquidity risk in IBs.
To examine the key factors affecting the operational risk in IBs.
To provide policy implication for the central bank to devise prudential rules in
banking sectors for better risk management.
To suggest policy guidelines for the manager of Islamic banks to monitor and
control financial risk for the survival and success and avoid potential crises.
To differentiate Islamic banking industry in Pakistan and Saudi Arabia with
reference to the factors affecting credit, operational and liquidity risks.
To distinguish Islamic Banks in Pakistan from Islamic Banks in Saudi Arabia
with reference to risk management mechanism.

Research Question

Which type of financial risks are sensitive to Islamic banking?

Which factors are influencing Credit Risk in IBs
Which factors are influencing Operational Risk in IB s?
Which factors are influencing Liquidity Risk in IBs?
Is there any difference between factors affecting financial risk in IBs of
Pakistan and in IBs of Saudi Arabia?