Work detail

Efficiency and Stability of Islamic Banking: Empirical Evidence from the Middle East Region

Author: Mgr. Kateřina Čábelová
Year: 2016 - summer
Leaders: prof. Ing. Michal Mejstřík CSc.
Consultants:
Work type: Finance, Financial Markets and Banking
Masters
Language: English
Pages: 124
Awards and prizes:
Link: https://is.cuni.cz/webapps/zzp/detail/152167/
Abstract: The recent nancial crisis has drawn the attention towards Islamic nance. Islamic
banks have demonstrated not only a great resilience to nancial instability
but they also still maintain the rapid growth. The main characteristic of Islamic
nancial system is a prohibition of interest that is perceived as highly unethical
in Muslim world. Interest is replaced by Prot and Loss Sharing principle in
which a bank plays role of a business partner rather than a creditor. Fundamental
dierences in banking strategy between Islamic and conventional banks
are apparent, however, their implications for overall bank performance are still
the subject of discussions. This thesis empirically investigates eciency and
stability of banking sector in the Middle East region where both banking systems
coexist alongside and where the largest concentration of Islamic assets is
currently held. The eciency was measured independently by two frontier techniques,
namely Data Envelopment Analysis and Stochastic Frontier Analysis.
Thereafter a regression analysis was performed to examine determinants of bank
eciency and to investigate the impact of the crisis on both types of banks. The
results indicate that Islamic banks are more resilient to nancial instability but
their operation is more cost demanding compared to traditional banks.
August 2020
MonTueWedThuFriSatSun
     12
34

56789
10111213141516
17181920212223
24252627282930
31      

Partners

Deloitte

Sponsors

CRIF
McKinsey
Patria Finance