Islamic Banking Structure and Performance E-Book

Sarah Bassam Awad

• Herausgeber: GRIN Verlag
• Sprache: Englisch

Veröffentlichungsjahr: 2011

Beschreibung

Master's Thesis from the year 2010 in the subject Business economics - Investment and Finance, grade: Merit, University of Essex (Essex Business School), course: Finance and Investment, language: English, abstract: The dissertation explores the variables in relationship with returns in Islamic Banking.It also introduces the history and governance structure of Islamic Banks in the countries within the study. The analysis is based on 49 banks across countries of varying economic stance from the years 2004 to 2008. Important evidence was found showing significant relationship between market concentration and returns in Islamic banks in most of the countries being studied. These findings are consistent with our expectations. Overall, our results suggest that there are highly significant relationships between returns, capital ratios, market concentration and money supply, which can all be used in assessing performance.

Leseprobe

Table of Content

Chapter

1.1 Background

1.2 Aims and Research Questions

1.4 Dissertation Structure

2.1 Introduction

2.2 Islamic Banking Overview.

2.3 Islamic Banking Model

2.4 Main features of top performing Islamic banks

2.5 Conclusion

3.4 Past Studies and Findings

3.4.1 Conventional Banking Literature in EU

3.4.2 Islamic Banking Literature

3.5 Conclusion

4.1 Introduction

4.2 Dataset and Methodology

4.2.1 Data

4.2.2 Methodology

4.3 Model Specification and Description of variables

Page 1

Page 2

I would like to dedicate this dissertation to my parents Sheikh Bassam and Sheikha Marina

Awad. Without their support and understanding; I would not be who I am today.

Furthermore, I would also like to dedicate this to all my mentors, professors and most

specially my supervisor, who gave me a very special gift- the gift of knowledge and the

Page 3

This work will not be completed without the help of my supportive family, colleagues

and mentors. First of all; I would like to give my utmost gratitude to my supervisor, Dr.

Claudia Girardone, for the amount of guidance and support that she gave me in every step

that I took. She made this whole experience an enjoyable one, and I would do it all over again

with her as my mentor. I am truly honoured to be one of your students! Also, I would like to thank my professors: Dr. Carlo Rosa and Dr John Nankervis, for

sharing their valuable time and knowledge in Eviews, which helped me in running my

regressions. Furthermore, Ms. Samah Issah for giving me access to Bankscope database to

collect the necessary information that I need. My humblest gratitude to all of you. Moreover, I would like to thank my parents for their constant encouragement during

rough times throughout the year, and for their dedication to my skills, when I am in doubt. I

truly appreciate the sacrifices that you both have done for me, and I will continue in pursuing

my goals with both of you by my side.

All I have is this page in return to all you have done for the success of my dissertation.

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The dissertation explores the variables in relationship with returns in Islamic Banking.

It also introduces the history and governance structure of Islamic Banks in the countries

within the study. The analysis is based on 49 banks across countries of varying economic

stance from the years 2004 to 2008. Important evidence was found showing significant

relationship between market concentration and returns in Islamic banks in most of the

countries being studied. These findings are consistent with our expectations. Overall, our

results suggest that there are highly significant relationships between returns, capital ratios,

market concentration and money supply, which can all be used in assessing performance.

Keyword: Islamic Banks, performance, structure, concentration

Page 6

4.4 Conclusions 25

Chapter 5- Discussion of Findings 26

5.1 Introduction 26

5.2 Initial Investigation: Financial Ratio Analysis 26

5.3 Primary Investigation; Empirical Analysis 35

5.4 Discussion of Empirical Findings 36

5.5 Conclusion 43

Chapter 6- Conclusion 44

6.1 Overview 44

6.2 Limitations and Future Research 45

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Figure 2.1: Governance Structure of Islamic Banks 8

Table 2.1: Top 20 leading Islamic banks across the sample size (2008) 10

Table 4.1: Categories of countries studied 20

Equation 4.1: Simple version of SCP model 21

Equation 4.2: Regression formula used in the dissertation 23

Chart 5.1: Trend Analysis for GCC countries 27

Chart 5.2: Trend Analysis for non-GCC countries 29

Chart 5.3: Trend Analysis for Purely Islamized Banking Sector 31

Table 4.2: Definition of variables 23

Table 5.1: Financial Ratio Analysis across country 33

Table 5.2: Regression result for GCC countries 37

Table 5.3: Regression result for non-GCC 39

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GCC Gulf Cooperation Council IMF International Monetary Fund NIM Non-interest Margin PLS Profit and Loss Sharing ROA Return on Assets ROE Return on Equity SCP Structure-Conduct-Performance theory