International Congress on Eurasian Economies
26-28 June 2024 – Bishkek, KYRGYZSTAN
Paper properties
Paper ID : 2931
Status : Paper accepted
Language : English
Topic : Finance and Financial Crises
Presenter: Dr. Balazs Cseh
Session : 6A Microeconomics
The rise of Islamic finance in the Balkans
The rise of Islamic finance in the Balkans
- Dr. Balazs Cseh (University of Sopron, Hungary)
- Prof. Dr. Varga József (Hungarian University of Agriculture and Life Sciences, Hungary)
Abstract
The Islamic banking system has a successful career. In this study, the authors analyze the activities of Islamic banks operating in the Balkans. Furthermore, the enormous growth of the Islamic financial sector can be measured in global terms. All of this can be traced back to the fact that the difficulties caused by the 2008 financial crisis, the pandemic or the Ukrainian-Russian conflict deeply affected many traditional banks in the world and in the Balkan region, which resulted from their procyclical nature. This is of course also true for Islamic banks, but due to their countercyclical nature, cross-border Islamic financial activities have grown worldwide, including notably the Balkan activities. In view of the above, the publication contributes to the study of the Islamic banking system operating in the Balkans. The operation of these banks is interesting because they operate in a non-majority or necessarily homogeneous Islamic financial environment. Also, it can be observed in the region that instead of founding a purely Islamic bank, it seems a more realistic scenario in the near future that traditional banks provide Islamic banking system services, so-called in the form of an "Islamic window". In addition, due to the nature of the investment bank, for example, banks of this type appear in Serbia as insurers of external working capital and investments. In the opinion of the authors, the spread of Islamic finance in the Balkan region will only increase in the near future, which justifies the strategic relevance of the analysis and situation assessment.
JEL codes: G01, G21, R11
