Performance differences between Islamic and conventional banking forms

Alshammari, Turki

doi:10.21511/bbs.12(3-1).2017.08

Cited by 16 publications

(13 citation statements)

References 10 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…Furthermore, the correlation between NPF and ROA results in a negative relationship so that an increase in NPF will reduce the profitability of Islamic banking (Santoso et al, 2019). At the same time, NPF correlation with ROA is positive and will improve efficiency (Santosa, 2011;Alshammari, 2017;Dahir et al, 2019).…”

Section: The Correlation Between Rgec and Non-performing Financingmentioning

confidence: 99%

The Relationship of Macro-risk Indicators, Internal Factors, and Risk Profile of Islamic Banking in Indonesia

2020

View full text Add to dashboard Cite

This study is essential because of Islamic banks have a level of health with higher NPF than conventional banks and purposes to examines whether macroeconomic indicators (macro-risk), internal factors of banking (GCG-earnings-capital ) and risk profile have correlation in term Indonesian Islamic banking. The method used is the correlation analysis involving four macro-risk variables (Forex; BI rate; Inflation and GDP), three GEC variables (GCG; ROA, and CAR) and two risk profile (FDR and NPF). The number of samples of the ten largest Indonesia sharia commercial banks with the 2011-2018 period. We find that macroeconomic indicator is positively correlated to non-performing financing (NPF), the GEC positively correlated to NPF and FDR; GEC negatively correlated to macro-risk indicators, generally. However, some indicators negatively correlated such as GDP-corporate governance, Forex-profitability, GDP-efficiency, BI rate-capital and profitability-NPF. The study proposed implications for managerial to understand the role of relationship of macroeconomic, internal factors and risk profile in Islamic bank lending.

show abstract

Section: The Correlation Between Rgec and Non-performing Financingmentioning

confidence: 99%

The Relationship of Macro-risk Indicators, Internal Factors, and Risk Profile of Islamic Banking in Indonesia

2020

View full text Add to dashboard Cite

show abstract

“…Turki Alshammari in his 2017 study (Alshammari 2017) found that the 2008 subprime crisis affected the performance of CBs, but not the IBs in Saudi Arabia, Kuwait, and United Arab Emirates. Mollah et al (2017) examined whether the difference in governance structures influences the performance of Islamic banks compared to commercial banks.…”

Section: Review Of Literaturementioning

confidence: 99%

The Impact of the Global Financial Crisis on Profitability of the Banking Industry: A Comparative Analysis

Erfani

Vasigh

2018

Economies

View full text Add to dashboard Cite

In this paper, the effects of the recent global financial crisis on efficiency and profitability of financial institutions were analyzed. In a comparative study, the impacts of the global financial crisis on the performance of Islamic and commercial banks were examined. The fundamental difference between Islamic and conventional banking is that Islamic banking is founded upon the ethical principles of Islamic tradition and law (Sharia). By utilizing a sample of eight Islamic banks and eleven commercial banks, the impact of the global financial crisis on efficiency and profitability of the banking sector was evaluated. This study covered the period from 2006 to 2013. The results of this research were obtained from the Altman Z-score model, ratio analysis, the data envelopment analysis (DEA) method, and the seemingly unrelated regression (SUR) model. The results show that during the study period, Islamic banks (IBs) managed to maintain their efficiency while most commercial banks (CBs) suffered a loss in their efficiency. Furthermore, this study found that the financial crisis did not have a significant impact on the profitability of Islamic banks.

show abstract

“…While the ROE of GCC conventional banks averages 11.3%, it is almost 8.6% for GCC Islamic banks (which supports the argument of Alshammari, 2017). Third, Islamic banks seem to have riskier portfolios than those of GCC conventional banks.…”

Section: Resultsmentioning

confidence: 53%

State ownership and bank performance: conventional vs Islamic banks

Alshammari

2021

JIABR

Self Cite

View full text Add to dashboard Cite

Purpose This paper aims to examine the effect of state ownership on bank performance for all banks in the Gulf Cooperation Council (GCC) countries during the period 2003 – 2018, for two distinct banking systems: the conventional and the Islamic banking systems. Design/methodology/approach To achieve the goal of the study, this paper uses a mean t-test to examine the mean difference of the related variables for both banking systems, and a regression test (using the GMM method) to explore the effect of state ownership on bank performance. Findings The most important result of the analysis is that state ownership has a significantly positive influence on bank performance for conventional banks but not for Islamic banks, in the GCC area. Originality/value This study adds to the scarce related literature comparative empirical results with respect to the impact of ownership on the performance of two different banking systems: the conventional system and the Islamic banking system in the GCC area. This study is likely to have implications for policymakers in terms of developing rules relevant to the governance of GCC’s two banking systems that can help to support the stability of the whole banking sector.

show abstract

Performance differences between Islamic and conventional banking forms

Cited by 16 publications

References 10 publications

The Relationship of Macro-risk Indicators, Internal Factors, and Risk Profile of Islamic Banking in Indonesia

The Relationship of Macro-risk Indicators, Internal Factors, and Risk Profile of Islamic Banking in Indonesia

The Impact of the Global Financial Crisis on Profitability of the Banking Industry: A Comparative Analysis

State ownership and bank performance: conventional vs Islamic banks

Contact Info

Product

Resources

About