Off-Balance Sheet Income Activities For Islamic And Conventional Banks

2015 ◽  
Vol 3 (3) ◽  
pp. 58
Author(s):  
Latifah Syaqirah Misni ◽  
Masturah Ma'in ◽  
Siti Sarah Mat Isa
Keyword(s):  
Panel Data ◽  
Interest Rate ◽  
Gross Domestic Product ◽  
Balance Sheet ◽  
Islamic Banks ◽  
Macroeconomic Factors ◽  
The Real ◽  
Independent Variables ◽  
Real Gross Domestic Product ◽  
Conventional Banks

The aim of this study is to investigate the determinants of off-balanced sheet income activities, considering the bankspecific and macroeconomic factors as independent variables in Islamic and conventional banks in Malaysia. This study utilizes 16 Islamic banks and 14 conventonal banks panel data from 2008-2013 and 2002-2013 respectively. The result shows that the determinants of off-balance sheet activities in Islamic banks in Malaysia are bank’s size (TA), bank’s profitability (NP), and interest rate (INT). While, the determinants of off-balance sheet activities in conventional banks are bank’s size (TA), bank’s profitability (NP) and the Real Gross Domestic Product (RGDP). 

scholarly journals Determinan Volume Pembiayaan Bank Umum Syariah Indonesia

IKONOMIKA ◽  
2017 ◽  
Vol 2 (1) ◽  
Author(s):  
Masudah Masudah
Keyword(s):  
Exchange Rate ◽  
Panel Data ◽  
Interest Rate ◽  
Operational Efficiency ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Efficiency Ratio ◽  
Independent Variables ◽  
Panel Data Regression ◽  
Data Regression

As a financial intermediary institution, Islamic banking should give a financing to deficit units. The aim of this study is to emphasize the factors that had an influence to financing in Islamic banks. This research using panel data regression with 11 Islamic full-pledge banks from 2011 until 2015. The result shows that deposit funds, exchange rate, operational efficiency ratio and interest rate had an impact on Islamic bank’s financing, but other variables such as non-performing financing and inflation doesn't had an impact. From F-test shows that all variables simultaneously had an impact on Islamic bank’s financing. Besides that, the value of adjusted R-square shows that all of the independent variables can explain the model about 78.5%, the others explained by other variables outside the model.

scholarly journals Effects of Macroeconomics Factors toward Efficiency in Banking

JEJAK ◽  
2018 ◽  
Vol 11 (2) ◽  
pp. 390-400 ◽  
Author(s):  
Faaza Fakhrunnas ◽  
Faiza Husnayeni Nahar ◽  
Hilman Fikri Albana
Keyword(s):  
Data Envelopment Analysis ◽  
Interest Rate ◽  
Growth And Development ◽  
Financial Statement ◽  
Islamic Banking ◽  
Data Envelopment ◽  
Islamic Banks ◽  
Bank Efficiency ◽  
Macroeconomic Factors ◽  
Conventional Banks

The main objective of this study is to analyze the effect of macroeconomic factors toward efficiency in Islamic and Conventional Banking. Banking as one of components in financial system that highly contributes to the growth and development of the economy in a country, especially after establishment of the first Islamic bank in Indonesia at the year of 1992. Afterwards, Islamic banking began to develop and start to compete with conventional banking. Hence, in order to survive and do fair competitiveness, Islamic and Conventional banking have to maintain its efficiency. This study uses the methodology of Data Envelopment Analysis (DEA). This study also analyze the macroeconomics factors namely inflation, interest rate of Bank indonesia and the growth of Gross Domestic Product (GDP) which affects the bank efficiency. Our data is obtained from annual financial statement published by each islamic and conventional bank and Bank Indonesia starting from 2007 to 2016. This study shows that conventional banks have higher efficiency than Islamic banks, while crisis in 2008 had no significant effect on the efficiency of Islamic and conventional banking. However, a decrease in the level of efficiency that occurs in conventional banking indicates that conventional banking is more sensitive to the crisis.

Financial Deepening, Financial Intermediation and Nigerian Economic Growth: Time Variant Analysis

2019 ◽  
pp. 60-73
Keyword(s):  
Economic Growth ◽  
Interest Rate ◽  
Gross Domestic Product ◽  
Private Sector ◽  
Money Supply ◽  
Domestic Product ◽  
Financial Deepening ◽  
Causality Test ◽  
Real Gross Domestic Product ◽  
Long Run

This study examines financial deepening, financial intermediation and Nigerian economic growth. The main purpose is to examine the relationship between financial deepening and Nigerian economic growth while the specific objectives are to examine the impact of interest rate, capital market development, rational savings, credit to private sector and broad money supply on the growth of Nigerian. Secondary data of the variables were sourced from the publications of Central Bank of Nigeria (CBN) from 1981-2017. Nigerian Real Gross Domestic Product (RGDP) was used as dependent variable while Broad money supply (M2), Credit to Private Sector (CPS), National Savings (NS), Capital Market Capitalization (CAMP) and Interest Rate (INTR) was used as independent variables. Multiple regressions with E-view statistical package were used as data analysis techniques. Cointegration test, Augmented Dickey Fuller Unit Root Test, Granger causality test was used to determine the relationship between the variable in the long-run and short-run. R2, F – statistics and β Coefficients were used to determine the extent to which the independent variable affects the dependent variable. It was found from the regression result that Broad Money Supply, credit to private sector have position effect on the growth of Nigerian Real Gross Domestic Product while National Savings, Capitalization and Interest Rate on Nigeria Real Gross Domestic Product. The co-integration test revealed presence of long-run relationship among the variables, the stationary test indicated stationarity of the variables at level. The Granger Causality Test found bi – variant relationship from the dependent to the independent and from the independent to the dependent variables. The regression summary found 99.0% explained variation, 560.5031, F – statistics and probability of 0.00000. From the above, the study concludes that financial deepening has significant relationships with Nigerian economic growth. We recommend that government and the financial sector operators should make policies that will further deepen the functions of the financial system to enhance Nigerian economic growth.

Impacts of Real Depreciation and Appreciation on Aggregate Output in Taiwan

2018 ◽  
Vol 65 (1) ◽  
pp. 123-130
Author(s):  
Yu Hsing
Keyword(s):  
Interest Rate ◽  
Gross Domestic Product ◽  
Stock Price ◽  
Real Interest Rate ◽  
Jel Classification ◽  
Oil Price ◽  
Real Gross Domestic Product ◽  
Real Gdp ◽  
Expected Inflation ◽  
Deficit Spending

Extending the IS-MP-AS model, this article finds that real depreciation helped to raise real gross domestic product (GDP) during 1999.Q1-2010.Q2 whereas real appreciation helped to increase real GDP during 2010.Q3-2016.Q4. In addition, a lower world real interest rate, a higher stock price, a higher real oil price or a lower expected inflation would increase real GDP. More deficit spending as a percent of GDP does not affect real GDP.JEL Classification: F41, E62

scholarly journals Profitability Variables and Bank Size Effects on Corporate Zakat: Evidence from Indonesian Islamic Banks

2019 ◽  
Vol 4 (1) ◽  
pp. 55-66
Author(s):  
Muhammad Anif Afandi
Keyword(s):  
Impulse Response Function ◽  
Islamic Banks ◽  
Vector Error Correction ◽  
Independent Variables ◽  
Vector Error ◽  
Long Run ◽  
Short Run ◽  
Operational Activities ◽  
Conventional Banks ◽  
Research Period

Islamic banks carry out their operational activities based on Islamic principles. Thus, they are not only required to pay taxes but also zakat of 2.5 percent with several conditions. Theoretically, zakat has an impact on Islamic banks larger expenditures compared to conventional banks which are not obliged to. This research examines and analyzes the extent to which profitability variables which are ROA, ROE, and BOPO, and bank size which is represented by total assets, can affect corporate zakat expenditure by Islamic Commercial Banks (BUS) in Indonesia. To do so, the Panel Vector Error Correction Model (PVECM) is used to analyze the subject matters which the period covers from 2012 to 2017. This work finds that in the short-run, all the independent variables were insignificant. However, in the long-run only ROE and BOPO which were significant. The results of the Impulse Response Function (IRF) analysis showed that the dependent variable responds to the shock of its independent variables with fluctuating and even negative trend. In addition, the results of Variance Decomposition (VDC) analysis showed that the contribution of profitability variables and bank size tended to decrease toward the formation of corporate zakat expenditure by BUS until the end of the research period. Keywords: Corporate Zakat Expenditure, Islamic Banks, Profitability, Bank Size, PVECM

Pengaruh Nilai Tukar (Kurs) dan Inflasi terhadap Tingkat  Non Performing  Financing (NPF) Pada Bank Syariah

2019 ◽  
Vol 2 (2) ◽  
pp. 214-224
Author(s):  
Muhammad Arfan Harahap ◽  
Anjur Perkasa Alam ◽  
Muspita Pradila
Keyword(s):  
Exchange Rate ◽  
Time Series Data ◽  
Sampling Technique ◽  
Series Data ◽  
Islamic Banks ◽  
Exogenous Variables ◽  
Independent Variables ◽  
Analysis Technique ◽  
The Exchange Rate ◽  
Conventional Banks

The level of Non-Performing Financing at Islamic Banks is higher than conventional banks, while in terms of total assets, Islamic Banks are smaller. This study aims to analyze the effect of exogenous variables consisting of the level of inflation and the exchange rate of the rupiah against non Performing Financing in Islamic banks. This study uses time series data from 2016-2018. The population in this study consisted of Islamic Commercial Banks. The sampling technique used in this research is purposive sampling technique. The data analysis technique used is Multiple Linear Regression. The results showed that the inflation variable had a positive and significant effect on Non Performing Financing. While the Exchange Rate has no effect on Non Performing Finance. Meanwhile, simultaneously the two independent variables affect the independent variables.

scholarly journals A Study of the Determinants of Cost and Revenue Efficiency in the Context of Islamic and Conventional Banks: The Case of Malaysia from 2006 to 2012

2016 ◽  
Vol 8 (7) ◽  
pp. 258
Author(s):  
Mohamed Ghroubi ◽  
Ezzeddine Abaoub
Keyword(s):  
Banking Sector ◽  
Generalized Least Squares ◽  
Decision Makers ◽  
Second Step ◽  
Islamic Banks ◽  
Regulatory Capital ◽  
Political Decision ◽  
Independent Variables ◽  
Conventional Banks ◽  
Revenue Efficiency

<p>In this paper, we examine the determinants of cost and revenue efficiency of Malaysian banks over the period 2006-2012. Three steps are undertaken to study a sample of 17 Islamic banks (IBs) and 20 conventional banks (CBs). In the first step, we assessed the competitiveness of the Malaysian banking sector. After solving the multicollinearity problem, as a second step, we selected three sets of independent variables: bank-specific, industry-specific and macroeconomic variables. In the last step, we estimated the efficiency models with the Feasible Generalized Least Squares (FGLS) method. The obtained results highlighted the importance of regulatory capital and size. As for the effect of competitiveness, it is found to be statistically significant only for revenue efficiency. These results may be useful to political decision-makers and regulatory authorities.</p>

When benchmark rates change: the case of Islamic banks

2019 ◽  
Vol 27 (2) ◽  
pp. 197-214
Author(s):  
Simon Archer ◽  
Rifaat Ahmed Abdel Karim
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Financial Services ◽  
Financial Stability ◽  
Descriptive Analysis ◽  
Interest Rate Risk ◽  
Islamic Banks ◽  
Content Type ◽  
Study Approach ◽  
Conventional Banks

Purpose This paper aims to examine the issue that arises in the context of benchmark rate (or interest rate) changes made for reasons of monetary policy in a jurisdiction with a significant presence of Islamic banks. Changes, especially increases, in the prevailing interest rate made by central banks raise issues of asset-liability management for banks, which typically have longer maturities on the asset side than on the liabilities side, resulting in exposure to interest rate risk for conventional banks, and what is known as rate of return (RoR) risk for Islamic banks, which for reasons of compliance with Islamic religious law (Shari’ah) do not use interest in their operations. Islamic banks use various financial instruments which reflect the cost of funds by means of contracts of sale on credit or of leasing or forms of partnership, which allow them to earn returns on their funds and to pay returns to customers who deposit funds with them. Design/methodology/approach The methodology of this study consisted of a descriptive analysis of the relevant characteristics of Islamic banks and their economic and regulatory environments, illustrated by a case study approach applied to two jurisdictions, namely, Sudan and Malaysia. Findings In jurisdictions where Islamic banks represent a significant share of the market for financial services, if the contracts used in Islamic financing allow for periodic adjustments of the profit rate or lease rental, this could result in a significant impediment to the full implementation of monetary policy and hence to the maintenance of financial stability. Originality/value This study is (to the best of authors’ knowledge) the first thorough analysis in the literature of the issues arising from the exposure of Islamic banks to RoR risk and has clear implications for regulatory and central bank policy.

scholarly journals Social Environment Determinants of Life Expectancy in Developing Countries: A Panel Data Analysis

2016 ◽  
Vol 9 (5) ◽  
pp. 105 ◽  
Author(s):  
Fatin Aminah Hassan ◽  
Nobuaki Minato ◽  
Shuichi Ishida ◽  
Norashidah Mohamed Nor
Keyword(s):  
Developing Countries ◽  
Health Status ◽  
Panel Data ◽  
Life Expectancy ◽  
Gross Domestic Product ◽  
Health Expenditure ◽  
Independent Variables ◽  
Long Run ◽  
Improved Sanitation ◽  
The Relationship

<p>Despite remarkable improvements in health over the past 50 years, there still remain a great number of health challenges around the world. This study examined the relationship between life expectancy rate (as a proxy for health status) with health expenditure, gross domestic product, education index, improved water coverage, and improved sanitation facilities in 108 selected developing countries using annual panel data within the period of 2006–2010. The empirical results from using the panel data approach showed a positive relationship between life expectancy rate and all of those explanatory variables. The relationship between life expectancy with education index and gross domestic product were significant at 1% and 5% significance levels, respectively. Furthermore, the causality finding showed that there is no short-run causality between life expectancy and its determinants. There is a unidirectional causality running from the independent variables of health expenditure, education index, improved water, and improved sanitation to life expectancy at birth. On the other hand, bidirectional causality exists between life expectancy and income in the long-run by employing VECM test.  These independent variables can be considered as important determinants for investment in health status in the long-run. This study could be used as a guideline and may be significant for future researchers and policy makers who aim to improve the life expectancy in developing countries.</p>

scholarly journals The role of entrepreneurship in explaining the real Gross Domestic Product per capita: Regression model selection

2016 ◽  
Vol 2 (1) ◽  
pp. 24-38
Author(s):  
Anita Harmina
Keyword(s):  
Model Selection ◽  
Gross Domestic Product ◽  
Early Stage ◽  
Entrepreneurial Activity ◽  
Gdp Per Capita ◽  
The Real ◽  
Independent Variables ◽  
Real Gdp ◽  
Real Gdp Per Capita ◽  
Per Capita

Abstract In this research, the impact of total early-stage entrepreneurial activity and competitiveness of the economy on the real gross domestic product (GDP) per capita is analyzed in a cross-section of world economies using the methods of correlation and multiple regression analysis. In the attempt to select between the linear and the double-logarithmic model, the regression diagnostics and quality of the relationship between the dependent and the independent variables were analyzed. The functional form of the model was tested by the MacKinnon, White and Davidson test. Model selection methods regarding the comparison of coefficients of determination and the Akaike information criterion were used. The results of the analysis show that independent variables have a statistically significant impact on the real GDP per capita, and that the real GDP per capita is elastic to the changes of competitiveness but inelastic to the changes of total early-stage entrepreneurial activity.

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