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Performance of islamic banks across the world: an empirical analysis over the period 2001-2008

Listed author(s):
  • Sandrine Kablan

    ()

    (ERUDITE - Equipe de Recherche sur l’Utilisation des Données Individuelles en lien avec la Théorie Economique - UPEM - Université Paris-Est Marne-la-Vallée - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12)

  • Ouidad Yousfi

    ()

    (MRM - Montpellier Research in Management - UM1 - Université Montpellier 1 - UM3 - Université Paul-Valéry - Montpellier 3 - UM2 - Université Montpellier 2 - Sciences et Techniques - UPVD - Université de Perpignan Via Domitia - Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School - UM - Université de Montpellier)

Our study aims at analyzing Islamic bank efficiency over the period 2001-2008. We found that they were efficient at 92%. The level of efficiency could however vary according to the region where they operate. Asia displays the highest score with 96%. Indeed, country like Malaysia made reforms in order to allow these banks to better cope with the existing financial system, display the highest scores. On the contrary countries with Islamic banking system do not necessarily display efficiency scores superior to the average. The subprime crisis seems to have impacted those banks indirectly. And market power and profitability have a positive impact on Islamic banks efficiency, while it is the contrary for their size. The latter implies that they do not benefit from scale economy, may be because of the specificity of Islamic financial products.

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Paper provided by HAL in its series Working Papers with number hal-01527696.

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Date of creation: 24 May 2017
Handle: RePEc:hal:wpaper:hal-01527696
Note: View the original document on HAL open archive server: https://hal-upec-upem.archives-ouvertes.fr/hal-01527696
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