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Performance of Islamic Banks across the World: An Empirical Analysis over the Period 2001-2008

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  • Sandrine Kablan
  • Ouidad Yousfi

Abstract

Our study analyzes cost efficiency of Islamic and conventional banks drawing on a sample of 233 banks in 17 countries from Africa, Asia, Europe and Middle East, over the period 2001-2008. We found an efficiency score of 78.9%. Commercial banks in the 17 countries, display an average efficiency score of 82.50%. However, the level of efficiency for score Islamic banks varies according to regions, while it is quite similar for commercial banks. Asia Islamic banks display the highest score with 84.64%. On the contrary countries with Islamic banking system do not necessarily display the highest efficiency scores. Further analyses on commercial banks, in the selected countries strengthen the conclusion for a better regulation. Besides, the subprime crisis did not impact Islamic banks.

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  • Sandrine Kablan & Ouidad Yousfi, 2015. "Performance of Islamic Banks across the World: An Empirical Analysis over the Period 2001-2008," International Journal of Empirical Finance, Research Academy of Social Sciences, vol. 4(1), pages 27-46.
    • Handle: RePEc:rss:jnljef:v4i1p3
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    More about this item

    Keywords

    Islamic Banks; conventional banks; efficiency; stochastic frontier analysis.;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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