COMPARATIVE PERFORMANCE ANALYSIS OF ISLAMIC AND CONVENTIONAL BANKS

  • Lamin Fatajo

Student thesis: Master's Dissertation

Abstract

The study’s objective is to compare the effects of the global financial crisis in 2008/2009 on Islamic and Traditional banks’ performance. Three (3) performance metrics are taken into account such as return on assets (ROA) and on return on equity (ROE), as well as net interest margin (NIM). The study covered twenty-four (24) years, from 1997 to 2020. The study also uses random effects model (REM) to analyze, a sample of fifty (50) Islamic banks (IBs) and one-hundred and sixty-one (161) conventional banks (CBs) as part of its approach. The research reveals three (3) major outcomes: i) there was no major difference during the crisis between the sectors in term of net interest margin (Inconclusive). ii) Islamic banks perform better in term of return on equity compared to their conventional counterparts. iii) Conventional banks perform better in term of return on asset compared to Islamic banks.
Date of Award2022
Original languageAmerican English
Awarding Institution
  • HBKU College of Islamic Studies

Keywords

  • conventional banks
  • financial crisis
  • Islamic banks
  • random effects model

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