The Difference Between Performance Of Islamic Banks And Conventional Banks Before And During Financial Crisis

975 WordsDec 11, 20154 Pages
the difference between performance of Islamic banks and conventional banks before and during financial crisis. They did not find the difference between the profitability of two systems to be statistically different, though Islamic banks performed better than their conventional counterpart. Chazi and Syed (2010) have identified that Islamic banks have comparatively better risk management than conventional banks. Ouerghi (2014) also studied the impact of financial crisis and also conducted a post-crisis study on both banking systems to find that performance varies with the size of banks (Beck, Demirgüç-Kunt, & Merrouche, 2013). Ouerghi (2014) also found that profitability, credit risk and efficiency of conventional banks was better than Islamic banks but large Islamic banks did better than large conventional banks. Similarly, Mobarek & Kalonov (2014) provided empirical evidence, using two frontier approaches, from many OIC countries to compare Islamic and conventional banking. They found that though conventional banks more efficient in their operations, Islamic banks had an upper hand when it came to financial stability. Their extensive study covered pre-crisis and crisis periods. The finding of Mobarek & Kalonov (2014) is validated by an earlier study conducted by Al-Hares, AbuGhazaleh, & El-Galfy (2013) in which they studied banks from 2003-2011. Al-Hares, AbuGhazaleh, & El-Galfy (2013) found that Islamic banks in Gulf Cooperation Council (GCC) were less efficient than

More about The Difference Between Performance Of Islamic Banks And Conventional Banks Before And During Financial Crisis

Open Document