Comparative analysis on the financial performance of Islamic and conventional banks in Malaysia

Islamic banks (IBs) are characterized by their uniqueness of complying with Shariah where the aim is to bring benefits to all parties. For that reason, previous research argued that these banks were stable in the aftermath of the recent global financial crisis unlike Conventional banks (CBs). The...

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Main Authors:	Ahmed Sulub, Yasin, Che Mohd Salleh, Marhanum
Format:	Conference or Workshop Item
Language:	English
Published:	International Research Centre of Islamic Economics and Finance (IRCIEF) 2018
Subjects:	BP173.75 Islam and economics HG3368 Islamic Banking and Finance HJ1438 Public Finance In Islam
Online Access:	http://irep.iium.edu.my/47425/ http://irep.iium.edu.my/47425/ http://irep.iium.edu.my/47425/1/47425_Comparative%20Analysis%20on%20The%20Financial%20Performance.pdf

id	iium-47425
recordtype	eprints
spelling	iium-474252018-10-29T02:09:10Z http://irep.iium.edu.my/47425/ Comparative analysis on the financial performance of Islamic and conventional banks in Malaysia Ahmed Sulub, Yasin Che Mohd Salleh, Marhanum BP173.75 Islam and economics HG3368 Islamic Banking and Finance HJ1438 Public Finance In Islam Islamic banks (IBs) are characterized by their uniqueness of complying with Shariah where the aim is to bring benefits to all parties. For that reason, previous research argued that these banks were stable in the aftermath of the recent global financial crisis unlike Conventional banks (CBs). Therefore, this paper aimed at comparing the financial performance of IBs and CBs, measured by Return on Equity (ROE), Return on Assets (ROA), Earnings per Share (EPS) and Debt Ratio. To examine this objective, the study chose four full-fledged IBs and four CBs in the period from 2012 to 2016 using t-test and correlation analysis. The findings revealed that CBs were more profitable and less leveraged than IBs. This research has implications for IBs that they should further improve their performance to become more competitive in the current financial industry. More importantly, the IBs need to uphold the Islamic ethics throughout the business to ensure both worldly and hereafter objectives is achieved. Future research should involve bigger samples and more performance indicators, either quantitative or qualitative, in order to extend the current research findings. International Research Centre of Islamic Economics and Finance (IRCIEF) 2018 Conference or Workshop Item PeerReviewed application/pdf en http://irep.iium.edu.my/47425/1/47425_Comparative%20Analysis%20on%20The%20Financial%20Performance.pdf Ahmed Sulub, Yasin and Che Mohd Salleh, Marhanum (2018) Comparative analysis on the financial performance of Islamic and conventional banks in Malaysia. In: 1st Global Conference on Islamic Economics and Finance 2018 (GCIEF 2018), 24th-25th Oct. 2018, Kuala Lumpur. https://ircief.org.my/gcief2018/wp-content/uploads/2018/10/5.-Comparative-Analysis-on-The-Financial-Performance-of-Islamic-and-Conventional-Banks-in-Malaysia.pdf
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	BP173.75 Islam and economics HG3368 Islamic Banking and Finance HJ1438 Public Finance In Islam
spellingShingle	BP173.75 Islam and economics HG3368 Islamic Banking and Finance HJ1438 Public Finance In Islam Ahmed Sulub, Yasin Che Mohd Salleh, Marhanum Comparative analysis on the financial performance of Islamic and conventional banks in Malaysia
description	Islamic banks (IBs) are characterized by their uniqueness of complying with Shariah where the aim is to bring benefits to all parties. For that reason, previous research argued that these banks were stable in the aftermath of the recent global financial crisis unlike Conventional banks (CBs). Therefore, this paper aimed at comparing the financial performance of IBs and CBs, measured by Return on Equity (ROE), Return on Assets (ROA), Earnings per Share (EPS) and Debt Ratio. To examine this objective, the study chose four full-fledged IBs and four CBs in the period from 2012 to 2016 using t-test and correlation analysis. The findings revealed that CBs were more profitable and less leveraged than IBs. This research has implications for IBs that they should further improve their performance to become more competitive in the current financial industry. More importantly, the IBs need to uphold the Islamic ethics throughout the business to ensure both worldly and hereafter objectives is achieved. Future research should involve bigger samples and more performance indicators, either quantitative or qualitative, in order to extend the current research findings.
format	Conference or Workshop Item
author	Ahmed Sulub, Yasin Che Mohd Salleh, Marhanum
author_facet	Ahmed Sulub, Yasin Che Mohd Salleh, Marhanum
author_sort	Ahmed Sulub, Yasin
title	Comparative analysis on the financial performance of Islamic and conventional banks in Malaysia
title_short	Comparative analysis on the financial performance of Islamic and conventional banks in Malaysia
title_full	Comparative analysis on the financial performance of Islamic and conventional banks in Malaysia
title_fullStr	Comparative analysis on the financial performance of Islamic and conventional banks in Malaysia
title_full_unstemmed	Comparative analysis on the financial performance of Islamic and conventional banks in Malaysia
title_sort	comparative analysis on the financial performance of islamic and conventional banks in malaysia
publisher	International Research Centre of Islamic Economics and Finance (IRCIEF)
publishDate	2018
url	http://irep.iium.edu.my/47425/ http://irep.iium.edu.my/47425/ http://irep.iium.edu.my/47425/1/47425_Comparative%20Analysis%20on%20The%20Financial%20Performance.pdf
first_indexed	2023-09-18T21:07:29Z
last_indexed	2023-09-18T21:07:29Z
_version_	1777411030791487488

Comparative analysis on the financial performance of Islamic and conventional banks in Malaysia

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