Credit risk management in Islamic Banking

This study is to determine the risk exposure of the Islamic banks in the world. The study aims at studying the functioning of the Islamic Banks, differences between the Islamic and Conventional Banks and to deduce models to manage the risk in Islamic Banks. Regression analysis is used to find the effect of various factors on the credit of Islamic Banks. Regression analysis gives us the weights of various factors on the credit of the Islamic Banks. Linear regression helps to develop equation for all the three risks defined above, and this equation can be used as a generalized model for further purposes. For the study I have taken factors such as Leverage, Capital Adequacy Ratio, Loan Loss Provisions, Natural Log of Total Assets, Proportion of Loan to Deposits, Loan Growth.