Empirical determinants saving in the Islamic banks: evidence from Malaysia / Nuraini Abd Wahab

Nowadays there are tendency of depositors to withdraw their fund and transfer it to the conventional bank which offers higher interest rate. Since there is no guarantee by the government for saving against losses for Shariah compliant retirement scheme has affected depositors to put their saving in others commercial bank's deposit. Therefore, this paper aims to determine factors that influencing savings deposit and to evaluate whether the factors are related to the savings deposit of Islamic bank in Malaysia. This study will be use total savings deposit as dependent variable and selected economic factors such as rate of return of Islamic banks, interest rate of conventional banks and inflation (consumer price index) as independent variables. Consistent with the studies, the rate of return of Islamic banks, interest rate of conventional banks and inflation (consumer price index) will be measure by percentage. The data will be gathered then analysed by using multiple linear regression model. By using time series data, the data were collected from DataStream from January 2007 until December 2017 on quarterly basis. For the scopes of study, first paper explores the relationships between saving deposit of Islamic banks and the selected factors such as rate of return of Islamic banks, interest rate of conventional banks, age dependency ratio and inflation (consumer price index). Second, the paper attempts to examine the relative importance of those factors in encouraging savings deposit in Islamic bank.