This study explores the area of bank efficiency with the usage of Stochastic Frontier Analysis. The main objective is to identify determinants affecting conventional and Islamic banks' efficiency, focusing towards banks in Malaysia. Year-end financial data was obtained from a sample of 19 conventional banks and 16 Islamic banks that operate in Malaysia, where these banks' annual reports from the years 2008 until 2011 were referred for the purpose of analysis. An overall view of the results indicates that the levels of profit efficiency for both conventional and Islamic banks in Malaysia were highly similar. Further, it could be observed that efficiency would be better for conventional banks with the increment of bank size and also the decrement of both operational cost and credit risk, while the efficiency for Islamic banks would be better with only the decrement of operational cost.
Purpose The purpose of this paper is to explore the implementation of a mobile network system for an Islamic microfinance institution, made in collaboration with a commercial bank in Malaysia. It also intends to highlight any emerging issues pertaining to the implementation of technology into the disbursement and repayment system of an Islamic microfinance institution from their clients’ perspectives. As Islamic microfinance industry is still growing in Malaysia, findings gathered throughout the course of study are also intended to boost further knowledge relating to this area. Design/methodology/approach By using a case study method, interview sessions were conducted separately with clients of the Islamic microfinance institution. The purpose of interview sessions is to identify the benefits and problem that surrounds the usage of mobile banking into the repayment system for Islamic microfinance products. Data triangulation with various public documents was conducted to enhance the credibility and reliability of data, also to support the claims that were made by the respondents. Findings It was found that clients are quite satisfied with the disbursement process through a mobile solution. However, the same cannot be said with the repayment process. The difficulties in using the mobile solution pose a major threat to its success. As most clients are not born to be technological savvy, the lack of easiness in methods for the usage of a mobile solution for their transactions pushes them away from further exploring the benefits that can be brought in by the function. Other risks which were highlighted include concerns towards breach of trust and risks of robbery. Clients of the case study, on the other hand, are concerned that the transfer of cash between their meeting venues to the bank would expose them to the public who might try to take advantage from the situation. Research limitations/implications As the current study had only focusses on mobile banking aspect of the repayment system for one Islamic microfinance institution, a multiple case study could be adapted to investigate various banking channels being implemented by different Islamic microfinance institutions in Malaysia and their current success. Practical implications By highlighting several issues through this study, it is hoped that this Islamic microfinance institution would consider applying other means of payment that are available in the market that is not only cost-efficient, but also beneficial for clients of the institution. Originality/value This study highlights the setbacks in the usage of technology by clients of Islamic microfinance institution in Malaysia. Although many approved to the diffusion of innovation in Malaysian banking sector, the same has yet to be achieved in the Islamic microfinance industry, which clients are mostly technology illiterate.
Using CAMELS rating to measure bank performance, the present study compares the performance estimates for Islamic banks with conventional banks operating in Malaysia from 2008 to 2011. The present study further identifies the determinants affecting the performance of conventional and Islamic banks in Malaysia. Using a sample of 19 conventional banks and 16 Islamic banks, the results indicate that the levels of composite performance achieved by both conventional and Islamic banks in Malaysia are very similar. Furthermore, it is observed that the performance of conventional banks will improve following the reduction of operational costs, while the performance of Islamic banks will improve following the reduction of bank size and an increment of credit risk.
Fraud is a global issue overwhelming all aspects of human economic and business activities as it poses potential threat of financial losses. Many detection and prevention mechanisms, such as internal control systems, operational audits, codes of conduct and forensic accounting have been applied in organizations aiming to effectively mitigate internal fraud activities. However, fraud is still occurring. This study is therefore aimed to develop a multidimensional theoretical model which explains factors (categorized under attitude, subjective norms and perceived behavioral controls) that influence Levers of Controls (LOC); how level of LOC could influence fraud prevention framework as well as whether LOC could mediate the relationship between planned behavioral variables and effective fraud prevention framework. Concerning more on the adoption and post-adoption stages regarding drivers of LOC, this study constructs a model in attempt to close the knowledge gaps found in prior studies. From literature review, theories relating with fraud prevention and behavioral controls were examined to identify knowledge gaps within previous measurements of effective fraud prevention framework. A multidimensional Fraud Prevention (FP) model is then developed by innovating the Theory of Planned Behavior (TPB).
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