Competitiveness and Market Concentration of Islamic Banking Industry: A Comparison Study between Indonesia and Malaysia

Abstract

Financial integration in the ASEAN Economic community (AEC) by 2020 forces Islamic banks in Indonesia and Malaysia to be more competitive and have market power domestically and internationally to ensure business sustainability and increase assets rapidly in order to boost market share of Islamic banking in Indonesia and Malaysia. Islamic bank market competitiveness and power will determine the returns, investment, asset and trust of Islamic banks. The study uses data from 10 Islamic banks in Indonesia and Malaysia. The result confirmed that Islamic banking in Indonesia are characterized by the monopolize industry and Islamic bank in Malaysia are characterized by oligopoly Industry.

Estructura de mercado del sector bancario y su relación con el crecimiento económico: una revisión de literatura

“…Índice de Lerner (LI) El índice de Lerner es uno de los índices de poder de mercado más populares y más antiguos. Es una medida directa de la competencia a través de la distancia entre el precio y el costo marginal (Malini & Putri, 2020). El índice de Lerner (LI) se calcula utilizando la siguiente fórmula:…”

“…Sin embargo algunos autores encontraron que el sector bancario se acerca a un mercado de competencia perfecta (Rodríguez, T. G., Bolívar, H. R., & Reyes, A. Z., 2018;Sunarmo., 2018;Malini, H., & Putri, A. N., 2020).…”

Exploring The Cross Countries Endurance, Evidence of Indonesian and Malaysian Sharia Banks Financial Performance

“…In addition, the measurement of performance at banks is carried out using a method that is commonly known as the CAMELS method. This method looks at aspects of Capital, Assets, Management, Earnings, Liquidity, and Sensitivity of Market Risk by looking at the aspect of capital, asset quality, measuring the risks risk of policy, level of efficiency and effectiveness of management, and measure the ability of the bank to pay its debts (Malini & Putri, 2020).…”