Determinants of revenue efficiency of Islamic banks

2015 ◽  
Vol 8 (1) ◽  
pp. 36-63 ◽  
Author(s):  
Fadzlan Sufian ◽  
Fakarudin Kamarudin
Keyword(s):  
Southeast Asian ◽  
Least Square ◽  
Malmquist Productivity Index ◽  
Productivity Index ◽  
Islamic Banks ◽  
Asian Countries ◽  
Profit Efficiency ◽  
Content Type ◽  
Revenue Efficiency ◽  
Southeast Asian Countries

Purpose – The purpose of this paper is to examine the revenue efficiency of Islamic banks in the Southeast Asian countries. Specifically, the empirical analysis comprises Islamic banks operating in Malaysia, Indonesia and Brunei. This paper also seeks to investigate the potential internal (bank-specific) and external (macroeconomic and industry-specific) factors which influence the revenue efficiency of Islamic banks operating in Southeast Asian countries. Design/methodology/approach – This paper used a whole gamut of domestic and foreign Islamic banks operating in Southeast Asian countries, namely, Malaysia, Indonesia and Brunei during the period of 2006-2011. The level of revenue efficiency is computed by using the data envelopment analysis (DEA) method. Following the procedure set in Banker and Natarajan (2008) and Gujarati (2002), this paper use a panel regression analysis framework based on the ordinary least square and generalized least square methods to examine the potential determinants of revenue efficiency of the Islamic banks in the sample. In addition, this paper also use a battery of parametric (t-test) and non-parametric (Mann–Whitney [Wilcoxon] and Kruskall–Wallis) tests to examine the difference in the revenue efficiency of the domestic and foreign Islamic banks. Findings – The results indicate that the level of revenue efficiency on the domestic Islamic banks is higher compared to that of their foreign Islamic bank counterparts. The empirical findings seem to suggest that revenue efficiency has greater influence on the profit efficiency levels. It was found that the bank size, asset quality, capitalization, liquidity and management quality significantly influence the revenue efficiency of domestic Islamic banks operating in Malaysia, Indonesia and Brunei during the period under study. Research limitations/implications – Due to its limitations, the present study may be extended in variety of ways. First, if information on input prices is available, further analysis could be performed to investigate the cost, technical and allocative efficiency. Second, interested researchers may apply the Malmquist Productivity Index method to examine the sources of total factor productivity changes of Islamic banks operating in the ASEAN countries. Third, to obtain more robust results, empirical findings from the present study could be compared to the results derived from improved statistical methods, i.e. Bootstrap DEA. Practical implications – The empirical findings of this paper clearly call for regulators and decision-makers to review the revenue efficiency of banks operating in Malaysia, Indonesia and Brunei Islamic banking sectors. The results could also provide better information and guidance to the managers of Islamic banks, as they need to have a clear understanding on the impact of revenue efficiency on the performance of their banks. The empirical findings of this paper may also have implications for investors whose main focus is to gain higher profit from their investments. Originality/value – The paper is the first to provide empirical evidence on the determinants of revenue, cost and profit efficiency of Islamic banks operating in Southeast Asian countries.

Does productivity of Islamic banks endure progress or regress?

Humanomics ◽  
2017 ◽  
Vol 33 (1) ◽  
pp. 84-118 ◽  
Author(s):  
Fakarudin Kamarudin ◽  
Chiun Zack Hue ◽  
Fadzlan Sufian ◽  
Nazratul Aina Mohamad Anwar
Keyword(s):  
Banking Sector ◽  
Southeast Asian ◽  
Malmquist Productivity Index ◽  
Productivity Index ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Asian Countries ◽  
Productivity Level ◽  
Content Type ◽  
Southeast Asian Countries

Purpose This paper aims to explore the level of productivity of Islamic banks specifically in selected Southeast Asian Countries from the period 2006 to 2014. Besides, this study also investigates the potential determinants of bank-specific characteristics and macroeconomic conditions that may influence the productivity of banking sector. Design/methodology/approach The present study gathers data on the 29 Islamic banks from Southeast Asian countries, namely, Brunei, Indonesia and Malaysia. The productivity level of the Islamic banks is evaluated using the data envelopment analysis-based Malmquist productivity index method. The authors then used a panel regression analysis framework based on the ordinary least square to identify potential determinants. Findings The domestic and foreign Islamic banks have exhibited progress in total factor productivity change solely attributed to the increase in efficiency change (EFFCH) which were mainly managerial rather than scale related. Foreign-owned banks have been slightly more productive compared to their domestic-owned bank counterparts, attributed to a higher EFFCH but insignificantly different. Furthermore, capitalisation, liquidity and world financial crisis determinants have significantly influenced productivity level of Islamic banks. Originality/value The study on the productivity of Islamic banking is still in its formative stage. To date, very limited study has been conducted to examine the productivity level in Southeast Asian, which is a strong regional hub for Islamic banking. This study intends to fill the gaps with a specific focus on the productivity level, specifically narrowing down to Southeast Asian countries in the domestic and foreign Islamic banking sector.

scholarly journals INDEKS PERSEPSI KORUPSI DAN PEMBANGUNAN MANUSIA TERHADAP PERTUMBUHAN EKONOMI DI NEGARA-NEGARA ASIA TENGGARA

Jurnal Ecogen ◽  
2019 ◽  
Vol 1 (3) ◽  
pp. 681
Author(s):  
Muhammad Fajar ◽  
Zul Azhar
Keyword(s):  
Economic Growth ◽  
Human Development ◽  
Human Development Index ◽  
Fixed Effect Model ◽  
Southeast Asian ◽  
Least Square ◽  
Asian Countries ◽  
Development Index ◽  
The Government ◽  
Southeast Asian Countries

This research aims to know and analyze determine of corruption and the human development index to economic growth in Southeast Asian countries. This research use panel least square and Fixed Effect Model. The estimation result should that corruption has a possitive and significant effect on economic growth in Southeast Asian countries and the human development Index has a possitive and significant effect on economic growth in Southeast Asian countries. From the result of this research, to increase economic growth, the government in SoutheastAsian countries must strengthen the bureaucratic and legal institutions of a country,increase the role of the government or related agencies in monitoring and crackingdown on corruption that results in lossof government productivity and allocating resources appropriately so that the creation of peace and prosperity among the countries in Southeast Asian. Keywords: Economic Growth, Corruption, Human Development Index

scholarly journals Analysis of Comparative Efficiencies of Islamic Banks Across Nine South and Southeast Asian Countries.

2021 ◽  
Vol 10 (1) ◽  
pp. 71-85
Author(s):  
Abdus Samad
Keyword(s):  
Southeast Asian ◽  
Scale Efficiency ◽  
Islamic Banks ◽  
Asian Countries ◽  
Managerial Efficiency ◽  
Operating Side ◽  
Conventional Banks ◽  
Region Ii ◽  
Policy Prescription ◽  
Southeast Asian Countries

The purpose of this paper is two folds: (i) obtain the overall technical efficiencies (TE), pure technical efficiencies (PTE), and scale efficiencies of the Islamic bank of the nine South and Southeast Asian (SSEA) countries during 2011-2016. (ii) compare them among the Islamic banks of the SSEA. The paper applied the Bootstrap Data Envelope Analysis (DEA) for obtaining three efficiencies in the production of loan and earning assets and found that the average TE, PTE, and SE of the Islamic banks in the region were 77.3 percent, 81.2 percent, and 95.3 percent respectively. The comparison of PTE efficiencies across the Islamic banks found: (i) the average TE of the Islamic banks of Malaysia was 81.9 percent and was higher than the average of other countries in the region; (ii) the average managerial efficiency (PTE) of the Islamic banks of Malaysia, excluding Brunei, Singapore, and Thailand, was 87.0 percent and was higher than the average of other countries in the region; (iii) among countries of the South and Southeast Asia, excluding Singapore and Maldives, the Islamic banks of Pakistan were more scale efficient than other countries in the region. The average scale efficiency of Pakistan’s Islamic banks was 96.8 percent. The underlying reason for the Islamic banks of Malaysia and Pakistan most efficient in the region is because they were the forerunners. They were the first countries to introduce Islamic banks. Secondly, the banks of counties survived through competition with conventional banks operating side by side in the Islamic banks. The policy prescription suggests that bank regulators allow the opening of more Islamic banks to compete with conventional banks for improving PTE efficiency.

scholarly journals Assessing the domestic and foreign Islamic banks efficiency: Insights from selected Southeast Asian countries

2017 ◽  
Vol 3 (1) ◽  
pp. 33-46 ◽  
Author(s):  
Fakarudin Kamarudin ◽  
Fadzlan Sufian ◽  
Foong Wei Loong ◽  
Nazratul Aina Mohamad Anwar
Keyword(s):  
Southeast Asian ◽  
Islamic Banks ◽  
Asian Countries ◽  
Southeast Asian Countries

scholarly journals Bank Efficiency in Malaysia a DEA Approach

2019 ◽  
Vol 8 (1) ◽  
pp. 133-162 ◽  
Author(s):  
Fakarudin Kamarudin ◽  
Fadzlan Sufian ◽  
Annuar Md. Nassir ◽  
Nazratul Aina Mohamad Anwar ◽  
Hafezali Iqbal Hussain
Keyword(s):  
Banking Sector ◽  
Least Square ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Profit Efficiency ◽  
Bank Efficiency ◽  
Ordinary Least Square ◽  
Management Quality ◽  
Macroeconomic Determinants ◽  
Revenue Efficiency

Abstract The purpose of the present paper is to examine the revenue efficiency of the Malaysian Islamic banking sector. The study also seeks to investigate the potential internal (bank specific) and external (macroeconomic) determinants that influence the revenue efficiency of Malaysian domestic Islamic banks. We employ the whole gamut of domestic and foreign Islamic banks operating in the Malaysian Islamic banking sector during the period of 2006 – 2015. The level of revenue efficiency is computed by using the Data Envelopment Analysis (DEA) method. Furthermore, we employ a panel regression analysis framework based on the Ordinary Least Square (OLS) method to examine the potential determinants of revenue efficiency. The results indicate that the level of revenue efficiency of Malaysian domestic Islamic banks is lower compared to their foreign Islamic bank counterparts. We find that bank market power, liquidity, and management quality significantly influence the improvement in revenue efficiency of the Malaysian domestic Islamic banks during the period under study. This study provides for the first time empirical evidence that covering all three efficiency concepts, namely cost, revenue, and profit efficiency is completely missing from the literature. By calculating these efficiency concepts, we can observe the efficiency levels of the domestic and foreign Islamic banks. In addition, by comparing both cost and profit efficiency, we can identify the influence of the revenue efficiency on the banks’ profitability.

Comparative practices of food label claims from US, EU and selected Southeast Asian countries

2015 ◽  
Vol 32 (7) ◽  
pp. 530-541 ◽  
Author(s):  
May O. Lwin
Keyword(s):  
Southeast Asia ◽  
Food Products ◽  
Southeast Asian ◽  
Food Labels ◽  
Food Label ◽  
Asian Countries ◽  
Content Type ◽  
Wide Range ◽  
The Usa ◽  
Southeast Asian Countries

Purpose – The purpose of this paper is to fulfil gaps in knowledge regarding food packaging practices in Southeast Asia by examining the informational content of food labels on a variety of packaged foods. Design/methodology/approach – Using local and imported food products found in supermarkets in Singapore, a quantitative content analysis of food label claims in a wide range of packaged food products was conducted. A codebook was developed to capture the attributes of the food labels and claims, content categories, product names, food categories, sources of manufacture and countries of brand origin. The three main regions of analysis of country of manufacture were the USA, European Union (EU) and Southeast Asia. Findings – Analysis of food products manufactured in five Southeast Asian countries revealed the presence of various claims in food products, and a number of specific claims exceeded the percentages found in products from the USA or EU. The results showed that a significant proportion of products from Southeast Asian countries display nutrient content and nutrient function claims, as well as general marketing claims and non-nutrient claims. However, there were variations in practice amongst the five Southeast Asian countries. Research limitations/implications – The sample was limited in being collected from one geographic location. Future research needs to expand data collection both geographically and longitudinally. Practical implications – The findings are valuable for the national health authorities in addressing policies on food package labelling, and homogenization efforts pertaining to regional/international labelling policies. These in turn could influence food marketing practices. Social implications – The findings are useful in crafting educational programming and guidelines for health and nutrition education. Originality/value – This research is the first to explore food labelling practices in multiple Southeast Asian countries and compare them cross-sectionally with EU and US practices.

Gender and young consumer ethics: an examination in two Southeast Asian countries

2017 ◽  
Vol 18 (1) ◽  
pp. 94-114 ◽  
Author(s):  
Fandy Tjiptono ◽  
Denni Arli ◽  
Warat Winit
Keyword(s):  
Gender Differences ◽  
Southeast Asian ◽  
Consumer Ethics ◽  
Asian Countries ◽  
Convenience Sample ◽  
Content Type ◽  
Cultural Variations ◽  
Unethical Behaviors ◽  
The Impact ◽  
Southeast Asian Countries

Purpose This study aims to examine and compare ethical perceptions between genders on various potentially unethical consumer situations in Indonesia and Thailand. Design/methodology/approach A survey was conducted by distributing self-administered questionnaires to a convenience sample of university students in two large cities in Indonesia and Thailand. There are 278 respondents in Indonesia 158 participants for Thailand. Most respondents aged between 18-24 years. Findings Indonesian youths were found to believe that “passively benefiting”, “questionable action” and “downloading” are more unethical than Thai youths do. The relationship between gender and consumer ethics is not consistent in Indonesia and Thailand. Female youths in Indonesia tended to be more ethical in four out of seven dimensions of Consumer Ethics Scales than their counterparts, while no gender differences were found in Thailand. Practical implications The results show the different consumer ethics between Indonesia and Thailand that may reflect cultural variations, where Indonesia is more multicultural than Thailand. The mixed findings of the gender differences may suggest that there are no intrinsic gender differences in consumer ethics. Further, the results also provide implications for educators and public policy makers in both countries to encourage more active roles played by universities in building ethical sensitivity among future leaders. Originality/value This is one of the few studies examining the impact of gender on consumer ethical behavior in Southeast Asian countries, where various unethical behaviors (e.g. buying and using pirated products) are prevalent.

Obesity and overweight issues could undermine Malaysia’s competitiveness

2018 ◽  
Vol 11 (3) ◽  
pp. 204-213
Author(s):  
Hasliza Hassan ◽  
Abu Bakar Sade ◽  
Muhammad Sabbir Rahman
Keyword(s):  
Negative Impact ◽  
Southeast Asian ◽  
Overweight And Obesity ◽  
Economic Conditions ◽  
Average Weight ◽  
Asian Countries ◽  
Obese People ◽  
Content Type ◽  
Rate Of Increase ◽  
Southeast Asian Countries

Purpose The Malaysian lifestyle has been undergoing changes over time. With better socio-economic conditions, Malaysians tend to consume more food today than they did previously. Excessive intakes of high calorie foods combined with little daily physical activity have led to increased numbers of overweight and obese people in the population. The purpose of this paper is to compare the incidence of overweight and obesity in the population in Malaysia with other Southeast Asian countries. Design/methodology/approach Data for this research were based on secondary data of average weight, overweight and obese people for populations in the Southeast Asian countries. The analysis for this research focused on the population in Malaysia and compared it with populations from neighboring countries. Findings The population in Malaysia was ranked the second highest in the number of overweight and obese people in the Southeast Asian region. In addition, the rate of increase overweight and obese people in the population of Malaysia was found to be the highest in the region. Since the percentage of overweight and obese people had increased consistently from 2010 to 2014, there was a high possibility that the momentum would continue into the following few years. Originality/value Being overweight and obese was not desirable by the majority of people as it could lead to various health diseases and psychological problems. Unfortunately, the percentage of overweight and obese people in Malaysia seems to be increasing. Improved socio-economic conditions have increased the amount of food normally consumed by people. Although many people were found to be aware of the negative impact of being overweight and obese, the majority of them did not seem to take the initiative to reduce their body weight. This research is expected to create awareness of the alarming rate of increase in the number of overweight and obese people in Malaysia in order to encourage a healthier lifestyle.

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