IDEAS home Printed from https://ideas.repec.org/a/ris/ibajmb/0036.html
   My bibliography  Save this article

Impact of Credit Risk Transfer Techniques on Lending Behavior of Conventional & Islamic Banks in Pakistan

Author

Listed:
  • Saeed, Yusra

    (Department of Business Administration, Fatima Jinnah Women University, Pakistan)

  • Ayub, Huma

    (Department of Business Administration, Fatima Jinnah Women University, Pakistan)

Abstract

Application of risk management techniques gain significant importance after the financial crises of 2008. Banks adopt contemporary risk management techniques to eliminate credit risk associated with the enlargement of their lending volume. The present study aims to analyze the impact of credit derivatives on lending/financing behavior of conventional and Islamic banks of Pakistan. The study used comparative analysis by employing random effect model for the sample of 20 conventional banks and pooled OLS regression on sample size of 5 Islamic banks for the period of 2006-2016. Results of the study show that conventional banks effectively increase their lending volumes by utilizing risk transfer techniques. However, Islamic banks are still at its infancy in utilizing risk transfer techniques due to shariah restrictions. The study recommends policy implications for Islamic bank to introduce innovative shariah compliant hedging instruments to boost their financing portfolios.

Suggested Citation

  • Saeed, Yusra & Ayub, Huma, 2017. "Impact of Credit Risk Transfer Techniques on Lending Behavior of Conventional & Islamic Banks in Pakistan," Sukkur IBA Journal of Management and Business, Sukkur IBA University, vol. 4(2), pages 12-25, July - De.
    • Handle: RePEc:ris:ibajmb:0036
    DOI: 10.30537/sijmb.v4i2.108
    as

    Download full text from publisher

    File URL: https://doi.org/10.30537/sijmb.v4i2.108
    File Function: Full text
    Download Restriction: no
    File URL: https://libkey.io/10.30537/sijmb.v4i2.108?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Keywords

    Lending Behavior; Bank Credit Supply; Credit Risk Transfer; Credit Derivatives;
    All these keywords.

    JEL classification:

    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ris:ibajmb:0036. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Irfan Ali Menon (email available below). General contact details of provider: https://edirc.repec.org/data/sibaspk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.