SYLLABUS FACULTY ECONOMIC AND BUSINESS INTERNATIONAL PROGRAM FOR ISLAMIC ECONOMICS AND FINANCE (IPIEF)

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1 SYLLABUS FACULTY ECONOMIC AND BUSINESS INTERNATIONAL PROGRAM FOR ISLAMIC ECONOMICS AND FINANCE (IPIEF) 1 Name of Course / Module Risk Management in Islamic Financing 2 Course Code EI Credit Value 3 4 Objective 5 Learning Outcomes 6 Synopsis The objective of this course is to enable student to gain a thorough understanding of the Islamic risk management, more specifically for Islamic banking. On successful completion of this module students will: 1. Understand the fundamental features of the structure and basic operational of Islamic finance. 2. Poses basic knowledge and skills regarding with the management of risk, specifically associated with Islamic banking 3. Possess a broad understanding of regulations and supervision issues, both in the international as well as Indonesian perspective which is relevant to Islamic risk management. 4. Understand the basics risk management for Islamic finance, including Islamic microfinance/ banking. Islamic banking is fast growing and sophisticated industry. Islamic bank should compete not only among Islamic banks but also among conventional banks. Innovation and engineering of financial products now is must. This phenomenon, however, place financial sector be attractive and risky. The discussion will focus mainly on topics such as the structure and nature of banking and financial market, definition and types of risks, measurement and management of risks, and the regulation and supervision of risk in Indonesian and global perspective. e.g. Basel, AAOIFI, OJK and BI regulations. A review and analysis

2 7 References of recent developments and trends in the Islamic banking and financial market risk, both globally and in Indonesia, will enrich students knowledge toward the understand the operational practice of Islamic finance industry. Al Amin, Muhammad al Bashir, 2008, Risk Management in Islamic Finance, Boston: Leiden Mirakhor, Abbas, and Zamir Iqbal, 2011, Introduction to Islamic Finance, Singapore: John Wiley and Sons Fredric S. Mishkin, 2007, The Economics of Money, Banking, and Financial Markets, 8 th Edition, Addison-Wesley Series in Economics. Hayes, Samuel and Frank E Vogel, Islamic Law and Finance: Religion, Risk, and Return, Netherland: The Kluwer International Heffernan Shelagh, Modern Banking in Theory and Practice, John Wiley, (HS) David S.Kidwell, et,all, Financial Instituions, Market, and Money, Orlando: Dryden Press 1997 (DS) Jaffer, Sohael, 2002, Islamic Asset Management. London: Euromoney Books Usmani, M Taqi, 2003, Introduction to Islamic Finance, Karachi: Idaratul Ma arif, 2001, Encyclopaedia of Islamic Banking and Insurance, Lonndon: Institute of Islamic Banking and Insurance Hull, John, 2006, Risk Management and Financial Institutions, Prentice Hall 8 Lecturer MB Hendrie Anto, SE., M.Ec IPIEF Room, Postgraduate building, ground floor 9 Correspondence mohanto96@gmail.com 10 Consultation time By appointment 1. Competency Test I (17.5%); Competency Test II 11 Academic Evaluation (17.5%); Competency Test III (17.5%); Competency Test IV (17.5%);

3 2. Assignments and quizzes 30% Total 100% COURSE OUTLINE Meeting Course Material 1 The principles of Islamic finance 2 Why Islamic Finance is risky? 3 Basics for risk management 4 Types and nature of risks 5 Competency Test I 6 Specific risks related to financial contracts in Islamic finance 7 Basic risk management for Islamic bank 8 Understanding balance sheet and risk of Islamic banking 9 Competency Test II 10 Risk management in funding 11 Risk management in financing 12 Capital in risk management 13 Competency Test III 14 Liquidity risk management 15 Investment risk management 16 Regulation and supervision for risk in Islamic Banking 17 Introduction to risk management for microfinance 18 Competency Test IV Rules of class meeting: 1. Assignments/Quizzes Students will be required to complete several short assignments/quizzes. These assignments will constitute an integral part of building their knowledge and understanding in regarding information pertaining to this module.

4 2. Essays One individual essays will be assigned during the semester. The detail topic will be announced during the beginning of this course. This individual essay comprises of 2,500 to 3,000 words, should be typed on A-4 size paper with 1,5 line spacing. The essay content should include: o Title (cover sheet) o Introduction (background, main issues and selected topics) o Main Body o Conclusion and Implementation o References and Appendices. 3. Class presentations Students will be required to present their individual essay to the class. Each student will present once, for minutes. Each student must be actively involved in this discussion in order to be eligible for the 10% weighting awarded to this assignment. 4. In order to pass this subject, students must satisfy the following requirements: 1) A total assessment score of 50% 2) Class attendance of at least 75% 3) Completion of the course without academic cheating and/or unethical behaviours. These guidelines will be outlined in a learning contract in the first lecture. 5. Policy on assessment Essays and assignments will not be accepted after the due date unless arrangements for an extension of time have been made prior to the due date. If you do not agree with the result that you achieve for any piece of assessment for this subject please contact the lecturer immediately. You have a right to know the reasons why your work has received a certain grade and to request a better grade if you believe your work has been unfairly assessed.

5 6. Grading System Grading and Weight Interval (%) A A 80 AB 75 AB<80 B 65 B<75 BC 60 BC<65 C 50 C<60 D 35 D<50 E <35