Impact of exchange rate and oil price on the yield of sovereign bond and sukuk: Evidence from Malaysian capital market / Huda Arshad, Ruhaini Muda and Ismah Osman

This study analyses the impact of exchange rate and oil prices on the yield of sovereign bond and sukuk for Malaysian capital market. This study aims to ascertain the effect of weakening Malaysian Ringgit and declining of crude oil price on the fixed income investors in the emerging capital market. This study utilises daily time series data of Malaysian exchange rate, oil price and the yield of Malaysian sovereign bond and sukuk from year 2006 until 2015. The findings show that the weakening of exchange rate and oil prices contribute different impacts in the short and long run. In the short run, the exchange rate and oil prices does not have a direct relation with the yield of sovereign bond and sukuk. However, in the long run, the result reveals that there is a significant relationship between exchange rate and oil prices on the yield of sovereign bond and sukuk. It is evident that only a unidirectional causality relation is present between exchange rate and oil price towards selected yield of Malaysian sovereign bond and sukuk. This study provides numerical and empirical insights on issues relating to capital market that supports public authorities and private institutions on their decision and policymaking process

Exploring the Role of Student Exchange Programs in Fostering Halal Understanding among South Korean Non-Muslims

One of the challenges in halal is the acceptance among non-Muslims of the values, due to their lack of appreciation in understanding its concept. Media bias, culture, personal beliefs, racism and Islamophobia are some of the common causes. Past studies concluded that the concept of misjudgment could be realigned to a positive attitude by providing the appropriate information and education. Therefore, the study was conducted with the aim, of assessing how the provision of halal knowledge through the concept of a student exchange program could change a group of non-Muslims’ attitude, acceptance and behavior towards halal. A research experiment was administered that involved a group of university students from a private university in South Korea, who voluntarily took part in a 7-day halal program in Malaysia. The study involved 1) a pre-test assessment, 2) participation in the student exchange heutagogy program and 3) a post-test assessment. Based on the paired sample test results, overall, there was a significant increase in the halal understanding among non-Muslims of South Koreans. The novelty of the study stems from the need to understand non-Muslims’ perception of halal, specifically from the learning and cultural perspectives

The effect of brand personality and brand identification on customer retention : examining Islamic banking services in Malaysia / Husniyati Ali, 'Ismah Osman and Sharifah Faigah Syed Alwi

The development of Islamic banks in Malaysia is increasingly challenging with more banks offering products and services based on Islamic principles. Hence, this study explores customers' perception towards corporate image and its impact on selfexpressive value, brand distinctiveness, brand attractiveness as well as brand identification towards their most preferred Islamic bank in Malaysia. Institutional theory as well as theory of social identification was exploited as the theoretical foundation for developing the conceptual model. Accordingly, data was collected firstly, through an exploratory study, through interviews with customers, Shari' ah supervisors, practitioners and lecturers in Islamic banking. Next, 'self-administered questionnaires were distributed among 600 customers of Islamic banks in Kuala Lumpur through purposive sampling, specifically in selected Islamic banks, shopping malls and stations of public transportation. Analysis of data was conducted through descriptive, exploratory and confirmatory factor analysis. Subsequently, structural equation modelling with 308 respondents was then conducted to test the hypothesized relationships among the constructs, as postulated in the model. Nine hypothesis links were supported, while eight were rejected. Results indicate that firstly, corporate image of Islamic banks are determined by institutional image and performative image. Performative image constitutes items including friendliness, reliability, honesty, security, achievement-orientation, leading-orientation, up-to-date and excitement. In consequence, institutional image constitutes god-consciousness, which includes items like being Islamic, humbleness, fairness and trustworthiness. Secondly, institutional image and performative image have impact on brand attractiveness. However, they do not have an impact on self-expressive value, brand distinctiveness and brand identification. Thirdly, self-expressive value has an impact on brand's attractiveness. Fourth, brand's attractiveness and brand's distinctiveness have an impact on consumers' identification with a brand. Fifth, brand's attractiveness has an impact on word of mouth, as well as brand loyalty. Sixth, consumers' identification with a brand has an impact on brand loyalty. It is hoped that this study would facilitate in developing corporate image in Islamic banks, due to intense competition from many players of the industry

Capital Structure–Firm Performance Nexus: The Moderating Effect of Board Independence

The purpose of this study is to investigate the relationship between capital structure and firm performance by exploring the moderating effect of one of the corporate governance mechanisms, namely board independence. Panel data regression was employed based on a sample of 492 non-financial listed companies in Malaysia from 2010 to 2019. The results showed that capital structure has a significant positive impact on firm performance. Meanwhile, board independence significantly and negatively moderates the relationship between capital structure and firm performance. The findings of this study shall provide better insights for investors, firm managers, and policymakers on the critical role of corporate governance mechanisms in enhancing firm performance, particularly in implementing suitable actions and policies

Public Transport Services in Klang Valley: Customer Expectations and Its Relationship Using SEM

This study investigates users’ expectations towards the services provided by public transportations and its relationships to customer satisfaction, loyalty and environmental factors. Additionally, it attempts to determine the most preferred mode of public transport. The data was then analyzed using descriptive statistics and structural equation modeling (SEM). The most preferred mode of public transportation was LRT (35.8%), and monorail (28.1%). More importantly, customers’ expectations on PT services were based generally on the account of safety. Findings also indicate positive significant relationships between customer satisfactions, environment and loyalty, as well as positive significant relationship between environmental concern and loyalty

Corporate image of Islamic banks in Malaysia: an institutional theory approach

The development of the Islamic banks in Malaysia is increasingly challenging with more conventional banks having their own Islamic bank subsidiaries participating and offering banking products and services based on Islamic principles after two decades of its establishment. Undoubtedly, it is very important for the players in the Islamic banking industry to better position themselves, in order to confront and respond vigorously to the robustness of the global financial environment. Hence, this study would embark on corporate image as this would be one of the most important criteria in determining customers’ patronage towards Islamic banking. More importantly, this study adopts the institutional theory approach since those banks offering Islamic banking products and services are considered homogenous. Exploratory study through interviews was conducted with customers, Syari’ah supervisors, practitioners and lecturers in Islamic banking as to gain insights pertaining to corporate image in Malaysia. Next, survey was conducted through self-administered face-to-face method, from Islamic banking customers in the Klang Valley. Exploratory factor analysis and confirmatory factor analysis were then employed for the data analysis. Consequently, it is hoped that this study would facilitate in developing the Islamic banks’ marketing strategies which are very crucial specifically due to the intense competition from the players of the industry

Issues of Letter of Credit in Malaysian Islamic Banks

This paper discussed the prevailing issues currently faced by Islamic banks on the offering of Letter of Credit (LC), originally brought forward by the International Chamber of Commerce, using Shariah contracts and puts forth recommendations on practical solutions to solve the issues. The study adopted a qualitative method where the information on the issues of Islamic LCs was gathered throughout interviews with different bankers closely involved in LC issuance from 12 Islamic banks in Malaysia. The results indicate that there are three vital issues related to LCs offered by Islamic banks which lead to Shariah non-compliance issues. The issues revolve around the conversion of LC Wakalah (agency) to LC Murabahah (cost-plus), the existence of a sale contract between the customer and exporter and lastly the title of goods stated in the bill of lading. The findings recommend several solutions in relation to LCs within the underlying Shariah contracts to ensure that their operation complies with the Shariah requirements and Malaysian laws, standards and regulations. This paper highlights the issues of Islamic LC yet to be discussed thoroughly based on the views of a panel of experts and Islamic bankers

Revisiting the corporate image through service quality and relationship marketing:an empirical evidence from Malaysian and Saudi Arabian Takaful customers

Abstract Purpose: This study aims to test a proposed model based on a combination of the relationship marketing and service quality dimensions as predictors of corporate image and customer loyalty via corporate reputation in the Takaful context. More importantly, this study compares the Takaful operators’ services with the perceived service quality and the relationship marketing from the Malaysian and Saudi Arabian customers’ viewpoint. Design/methodology/approach: A survey-based study was conducted through a questionnaire, and the data was collected from Takaful customers (362 Saudi Arabian and 350 Malaysian customers) through an online survey. Structural equation modelling is used to test the proposed model. Besides, the perception of Takaful customers between Saudi Arabia and Malaysia is compared through a multi-group analysis. Findings: The results from the Malaysian context reveal that positive perceptions of service quality PAKSERV dimensions (personalization, reliability and tangibility) and positive perceptions of relationship marketing dimensions (Islamic ethical behaviour and structural bonds) have a significant influence on the corporate image. Alternatively, in the Saudi Arabian context, results have shown that the positive perceptions of service quality PAKSERV dimensions (assurance and reliability) of service quality and the positive perceptions of the relationship marketing dimensions (Islamic ethical behaviour, structural bonds and financial bonds) have a significant influence on the corporate image. The differences in both countries’ results can also enhance the corporate image on corporate reputation, merely in Malaysia. By contrast, corporate reputation is deemed a significant predictor of customer loyalty, represented as valid for both contexts. Research limitations/implications: The proposed research model tested in Takaful Malaysian and Saudi Arabian can be replicated in other contexts — in terms of country and industry. Moreover, the current study reveals the crucial role of corporate image in forming corporate reputation. Future research could be focussed on the importance of other emotional or affective variables that may be involved in determining corporate reputation. Finally, future studies can be carried with another cultural perspective to have more diversified socio-economic implications. Practical implications: It is suggested that Takaful operators from both Malaysia and Saudi Arabia need to put maximum effort towards customer loyalty by bringing both the dimensions of service quality and the relationship marketing in compliance with the principles of Islamic business transaction. The findings of the specific dimensions of service quality and relationship marketing will contribute to customers’ perceptions of corporate image and reputation in the Takaful industry. Originality/value: The present study tested a blended facet of customer’s overall experience through service quality (PAKSERV) and customer service provider connectivity (relationship marketing) to predict the corporate image of the highly growing financial marketplace (Takaful). Contextually, this study contributes to delineating the factors (corporate reputation) affecting customer loyalty rather than a customer satisfaction tradition. Significantly, Saudi Arabia and Malaysia were chosen for this study, as they are currently the two fast-growing markets for Islamic financial services, especially with regards to the Takaful products and offerings