Master of Science in Islamic Finance (MSc)

The course provides in-depth knowledge of economic principles and theories relating to macro and microeconomic issues. Students will be able to analyse economic issues and assess/evaluate policy options involving the society’s short, medium, and long-term agenda. Emphasis will also be given to reviewing the assumptions of conventional economic theories from the perspectives of Islamic economics and Islamic finance. This, in turn, will prepare the students to recommend strategies and policies for developing Muslim society.

This course covers the aspect of ethics and professionalism that are critical for developing leadership, governance and management skills. It includes understanding key aspects and the application of concepts, principles, codes and standards of ethics and professionalism for effective governance and sustainability of organisations as corporate citizens

This course covers various sale-based, partnerships and supplementary contracts used in Islamic Finance. Students will be able to comprehend the theoretical and practical applications of these contracts not limited to Islamic Banking, Takaful and Islamic Capital Markets.

This course is designed to prepare students with research tools for undertaking their dissertation/thesis. It focuses on the philosophy and theory of research methods by equipping students with approaches and techniques they may use in their dissertation/ thesis. Students will be exposed to the theory and application of quantitative, qualitative and big data analytics research tools and methodology.

This course provides knowledge on basic theories and practice of corporate finance in real markets. The exposure to the actual current practice of corporate finance in real markets is achieved through invited industry speakers’ case studies and industry-based problems. Each student is assigned to summarise and submit a written report on two academic articles on corporate finance issues. Overall, within the limited time of the scheduled 14 lecturers of 3 contact-hours lectures per week, students are provided with the basic knowledge of corporate finance and industry practice.

The course covers theories and principles of Islamic banking. The emphasis of the subject will be on regulatory and operational framework, product development, performance and efficiency and innovative banking solutions. Students will also be exposed to contemporary issues and equipped with various tools to analyse issues and propose solutions for the banking industry.

This course is designed to provide in-depth knowledge of the components and products of conventional and Islamic Capital Markets. The analytical techniques used in the design, pricing, and valuation of the products are emphasised. As an application-oriented course, the design and structuring of transactions form an integral part of the content. Products and processes are examined for their use in hedging (risk management), arbitrage, and trading. The course material is designed to give students the knowledge and skills needed to be successful in capital markets.

This course provides students with a sufficient grounding in the core disciplines of business strategy development and how to apply them. Students examine the strategic concepts and tools that facilitate understanding of the challenges and opportunities of the business environment, strategy formulation, implementation, and evaluation. This course equips students with the practical concepts and tools for analysing organisational strengths and weaknesses as well as market opportunities and threats.

This course is a method of learning that involves working on real projects, issues and challenges in collaboration with selected partner companies, using models taught in the classroom and supported by mentors, academic experts and industry leaders.

The objective of this course is to provide knowledge on how to plan, construct and manage portfolios of financial assets. This includes elements of investment, portfolio theory, equilibrium in capital markets, risk/return tradeoffs and optimal portfolios, security portfolio analysis, managing risk using derivatives and issues related to shariah compliant portfolio investments.

The course focuses on the macroeconomic implications of money markets and monetary policies. It also covers the IS-LM-AS framework and discusses various contemporaneous issues, including monetary credibility, monetary policy, exchange rate regimes and others. Throughout the course, the emphasis will be on applying the macroeconomic theoretical and analytical framework to analyse emerging issues in monetary economics.

This course covers financial econometric methods starting from unit root and cointegration test to VAR/VECM modelling. It demonstrates these methods theoretically and applies them to test hypotheses using time series data. The course develops students’ ability to use statistical software (EVIEWS and/or STATA) to estimate the models and to write empirical papers using the methods covered in the class.

The course aims to expose students to the risk management process (RMP) in banking. The RMP will identify, measure and mitigate risks in loans and financing. The course will expose students to the risk management framework (RMF) to expedite the RMP. In the RMF, the role of corporate governance, internal control and capital allocation are the infrastructure for RMP. When Islamic banks make murabaha to earn profits and assume risks associated with the financing operations, it is expected to find ways to manage these risks, which include credit, market, liquidity, operational and Shariah non-compliance risks. Some risks faced by Islamic banks are unique, hence requires special attention and ability to detect and control them accordingly. Students will acquire skills to identify risks, measure risks and mitigate risks in Islamic banking. The course will expose students to the Pillar 3 Disclosure of the Basel standard and banking supervision.

The course focuses on foreign exchange markets for spot and forward currency transactions, determinants of exchange rates, currency risk management, currency derivatives instruments, multinational corporate finance, and international capital movements. In addition, the emphasis is on applying theoretical models to address practical issues and Shariah concerns in international finance. The course is meant to develop skills that will help students think internationally.

This course covers the philosophy of producing financial statements using different financial reporting regimes, i.e., AAOIFI and IFRS. The students will be able to justify reporting strategies adopted by Islamic financial institutions in communicating their performance. In addition, the course provides opportunity for the students to apply accounting knowledge in the context of Shariah governance framework.

The course examines risk from the Islamic perspective and ways of mitigating it in accordance with Shariah. We will examine why insurance is forbidden and discuss the contractual and operational differences between takaful and conventional insurances. Students will learn of the various takaful business models, product types, and key operational areas, e.g., underwriting, claims, and financial management. The course will also examine the regulatory environment in various jurisdictions as the industry is highly regulated. Another topic covered is the actuarial aspects and functions of takaful, as this area is key to its financial soundness and sustainability. The appointed actuary position is a legal requirement in most jurisdictions.

This course covers econometric techniques commonly applied in empirical banking and finance research. These include advanced time-series econometrics and static and dynamic panel data modelling. In deliberating these advanced econometric techniques, the course deliberates their practical applications in analysing actual time-series and panel data as well as linking them to economic/financial theories. The use/application of these econometric techniques is demonstrated using statistical software.

The course provides financial and quantitative skills in building financial models. It covers quantitative models relating to active investing, investment styles, portfolio construction and management, pricing financial instruments, credit risk models, derivatives and valuation. The aim is to apply modern finance theory into practice by building investment models and strategies.

The course covers five major components of wealth management: (1) wealth generation, which is the primary source of wealth management. Wealth can be in the form of employment income, business and trade. (2) Wealth protection is where all our wealth needs to be protected through takaful or Islamic insurance. (3) Wealth accumulation is a constant process that involves generating more wealth, and, in the process, we need skills. (4). Wealth purification such as zakat, sadaqah and waqf, as in the process, we might have tainted our wealth. (5) Wealth Management from Islamic perspective.

The course covers linear algebra; differentiation and integration; ordinary and partial differential equations; probability theory; stochastic differential equations; option theory. The problem sets are drawn from the discipline of economics and finance. The course will also help students undertake quantitative research.

A research project for students