Capital adequacy standard according to Basel committee agreements and its application in islamic banks - a case study of Bahrain islamic bank 2015 - 2023

Resumo

The capital adequacy standard according to the Basel Committee is one of the most prominent risk management tools, and it is mandatory for all banks to apply, due to its imposition by central banks, but Islamic banks find some difficulties in applying this standard, because it contains only the characteristics of conventional banks, and an Islamic standard issued by the Islamic Financial Services Board was issued to amend the Basel Committee standard with the aim of applying it by Islamic banks, but the Basel standard remains the most recognized internationally. This study aims to know what was issued by the Basel Committee regarding the capital adequacy standard, and the possibility of applying it in Islamic banks, or the necessity of adapting to the Islamic standard issued by the Islamic Financial Services Board, and to achieve the objectives of the study, the descriptive approach, the analytical approach and the case study approach were followed, as the annual reports of the Islamic bank applied to it and the financial documents obtained were relied upon, and the study concluded by reaching a set of results, the most important of which is that Islamic banks can apply the Basel Committee standard, but applying the Islamic standard issued by the Islamic Financial Services Board is more appropriate because it takes into account the characteristics of Islamic banks in the capital adequacy equation.