The determinants of Islamic and conventional banking profitability in Asian countries / Nurhafiza Abdul Kader Malim and Sarini Azizan

Abdul Kader Malim, Nurhafiza and Azizan, Sarini (2020) The determinants of Islamic and conventional banking profitability in Asian countries / Nurhafiza Abdul Kader Malim and Sarini Azizan. Management & Accounting Review (MAR), 19 (3): 3. pp. 49-67. ISSN 2550-1895

Official URL: https://mar.uitm.edu.my/

Abstract

This paper aims to examine the determinants of Islamic and conventional banking profitability in Asian countries. We estimated an econometric model using the Generalized Method of Moments (GMM) from 2009 to 2013 based on 162 conventional banks and 65 Islamic banks operating in a dual banking system. This paper extends prior literature by examining the profitability of Islamic banks and conventional banks using the more comprehensive determinants, especially in Asian countries where studies are observably limited. The results show that the factors influencing the profitability of Islamic and conventional banks are different. The profitability of Islamic banks is significantly affected by the size, management efficiency, inflation, market concentration, the rule of law and monetary freedom. For conventional banks, the key determinants include capital, size, credit risk, management efficiency, monetary freedom and economic growth. The findings provide policy implications for enhancing the profitability in a dual banking system.

Metadata

Item Type: Article
Creators:
Creators
Email / ID Num.
Abdul Kader Malim, Nurhafiza
UNSPECIFIED
Azizan, Sarini
UNSPECIFIED
Subjects: H Social Sciences > HJ Public Finance > Finance, Islamic
Divisions: Universiti Teknologi MARA, Shah Alam > Accounting Research Institute (ARI)
Journal or Publication Title: Management & Accounting Review (MAR)
UiTM Journal Collections: UiTM Journal > Management & Accounting Review (MAR)
ISSN: 2550-1895
Volume: 19
Number: 3
Page Range: pp. 49-67
Keywords: Islamic banks, Conventional bank, Return on assets
Date: December 2020
URI: https://ir.uitm.edu.my/id/eprint/42269
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