Towards an Islamic financial system: a case study of the IDB

In the last quarter a century, Islamic banking becomes a hot issue in both Muslim and non-Muslim World and gained momentum. Many studies have been conducted on Commercial Islamic banking but nothing up to date has been done on Islamic development banking system. This research took the lead in this respect and concentrated on designing a theory for Islamic development banks. The existed IDB was taken as a case study for this research. The performance ofthe IDB had been evaluated through the financial development function, economic development function, social development function, and technology development function. To have better indications and realistic theory, two forms ofquestioners were designed (one form for the Governor's ofthe IDB and another form for the operation department staff) to help gathering information from the primary sources. To have a better picture about the IDBs performance it was evaluated from three perspectives. These three perspectives form as a pyramid. One side of the pyramid was the staff s opinion which represents the supplier side of finance and the other side of the pyramid was the Governor's point of view which represents the demander side of finance. The third side of the pyramid was represented by the financial and statistical analysis. All the three perspectives show that the IDB is still in its infancy and still needs a lot to be done to have a sound Islamic development bank. Data analysis proved that the suggested theory throughout this research is workable and applicable.