The integration of economic and social objectives is essential for Islamic bank to stimulate economic growth through the effective management and allocation of wealth and resources. This article proposes a hybrid mathematical optimization between the analytic hierarchy process (AHP) and multi-choice goal programming (MCGP) methods. The hybrid methods make the amalgamation of economic and social objectives possible in the multi-objective model of Islamic banking. The AHP method is used to determine the priorities or weights on each of the economic and social objectives. MCGP on the other hand, serves as an optimizer to the Multi-objective Decision Making (MODM) model that fits the priorities to the objectives and possible target goals. Results confirmed on the practicality and flexibility of the hybrid AHP-MCGP model which enable Islamic banks to better utilize their financial resources based on the priorities and multiple target goals. The feasible achievement of multi-objective with an interval target goal has offered the avenue for the decision makers at Islamic bank to satisfy economic and social goals simultaneously.

As the primary operational tool in the Islamic economics system, Islamic banking is assumed to run on the broader perspective of multi-dimensional objectives based on the foundation of shariah principles. This paper explicitly develops a multi-choice goal programming (MCGP) model of an Islamic bank for the optimal allocations of financial resources that satisfy both economic and social goals. The optimization model is verified using data from one of the premier Islamic banks in Malaysia as a sample model in determining the patterns and strategies taken in the allocations of financial resources. The veracity of the model is tested in terms of its ability to meet the specified target goals with minimum total deviations and to project the optimum allocation of asset and liability composition for a one-year time horizon. Results showed that the model could generate optimal financial resources that meet the specified target goals for economic and social objectives. A simulation analysis has been successfully performed to see the impact of changing the priority weight of management goals on the composition of financial resources. Thus, the model would be beneficial to the policymakers at Islamic banks for decision support and planning in view of its ability to incorporate economic and social objectives. Additionally, the proposed MCGP model offers flexibility to decision-makers in setting management target goals in the form of interval values to avoid error estimation of the decision.

Muslim depositor with savings in Islamic banking must pay zakat on savings when certain conditions are met. As accredited savings zakat collection agents, Islamic banking institutions provide savings zakat payment facilities directly to customers to encourage depositors to pay their savings zakat. Currently, there are only two Islamic banks with such facilities in Malaysia, which may reflect the level of awareness on this matter. Therefore, this study aims to identify factors influencing the behavioural intentions of Muslim individuals in paying zakat on savings directly through the bank. The framework of the study is based on a combination of the Theory of Planned Behaviour and the Theory of Islamic Consumer Behaviour. The framework of this study simultaneously introduces two new variables, namely Religious Obligation and Zakat Literacy mediator. Data collection used an online questionnaire instrument involving respondents among individual Muslim depositors in Selangor, Putrajaya and Kuala Lumpur. Estimationis based on partial least squares structure-equation modelling (PLS-SEM). The findings of the study show that Attitude, Religious Obligation and Perceived Behaviour Control through the mediator with the effect of Zakat Literacy influence behavioralintention to pay zakat savings directly through Islamic banks. However, for the Subjective Norm, it shows that it does not affect the BehavioralIntention to Pay zakat on savings through the Bank. Based on the findings of this study, it can be concluded that thenew variables introduced, which are Religious Obligation and Zakat Literacy mediator, can influence the willingness of Islamic depositors to use the facility of payment of zakat savings directly through banks. Therefore, it is recommended that Islamic banking institutions that have yet to offer the service to their customers to start doing so.

Risk management practices (RMPs) are important for Islamic banking institutions (IBIs) mainly because they represent the risk exposures that may affect their financial stability. The fact that RMPs is not a new activity in IBIs but still attract significant numbers of studies indicate the relevancy of the subject matter. For instance, weak risk management will hamper IBIs’ performance and eventually the stakeholders and industry at large. There are still lack of evidence on the effects of RMPs specifically on the IBIs given the nature and unique characteristics of the risks faced by these institutions. This systematic review article focuses on the effects of the RMPs on the performance of IBIs. Systematic literature review (SLR) is used in this study as it produces quality evidence on RMPs with more significant results on the effects of the IBIs’ performance. It defers greatly from the conventional literature review because the development of the systematic review is based on the main research question and utilized advanced search provided in the online journal databases. This study used eight (8) electronic journal databases and applied Preferred Reporting Items for Systematic review and Meta-Analysis (PRISMA). Based on the 39 primary studies related to RMPs and performance of IBIs, a total of 16 themes and 17 sub-themes were identified. The study finds that IBIs with good risk mitigation practices, risk management environment, policies and procedures, and risk monitoring have better financial performance. Hence, IBIs must ensure that RMPs a priority within the institutions to increase the financial performance and improve the overall competitiveness in the Islamic banking industry.