Credit risk management in Islamic and conventional banks

hussam ali daoud, Torki Al-Fawaz, Yaser Ahmed Arabyat

Abstract


The study aimed to compare credit risk management practices of in conventional and Islamic banks in Jordan, The study used descriptive analytical method, and also used questionnaire for data collection. The study sample consisted of (60) employees in the credit departments in Islamic and conventional banks, The study concluded there are differences in perception of credit risk management between conventional and Islamic banks as well as there are differences between Islamic banks and conventional banks in credit risk analysis, as well as there are differences between Islamic banks and conventional banks in reducing credit risk.
The study recommended that credit departments in conventional and Islamic banks should create an environment for risk management as well as supporting the internal evaluation system in banks, either for Islamic banks or conventional ones and should provide means that can help on reducing the risks faced by banks .The study also recommended conducting further studies regarding credit risk faced by the Islamic financing tools separately.

Keywords


credit risk, conventional banks, Islamic banks

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