Avoiding Investment Risks and its Role in the Problem of Excess liquidity in Islamic banks

摘要

Islamic banks have significant cash surpluses due to the relatively high volume of deposits compared to traditional banks, and this is due to several reasons, the most important of which is the religious incentive for members of the Arab and Islamic community that drives them to move away from interest (Reba), in addition to the failure of Islamic banks to take advantage of the central bank as a last resort for liquidity to adopt This is interest-bearing lending, which causes Islamic banks to maintain a large amount of liquidity as an alternative guarantee to the central bank. However, these high deposits have become a huge burden on the management of Islamic banks in light of their endeavors to keep pace with traditional banking in the formulas of financing and try to reduce the risks of financing to below the legal minimum, in addition to the absence of a secondary financial market in which these surpluses are invested, and as a result there were a problem with liquidity with Islamic banks, and this research will provide a perception about avoiding risks and its role in the emergence of a liquidity problem in Islamic banks.