Risk and Efficiency in Banking: A Comparative Study between Islamic and Conventional Banking
type: CreativeWork
description: Purpose: The main aim of this study is to address the current gap in banking risk and efficiency literature by investigating risk and efficiency levels, identify risk and efficiency determinants. This thesis examines banking risk from one side and efficiency from another. The study also provides a comparative study between Islamic and conventional banking in an effort to provide clear, wide, understandable results. Methodology: The study’s methodology will be applied according to three main steps: first, estimating risk and efficiency levels. Second, investigating risk and efficiency determinants. And finally, identifying those potential variables affecting risk and efficiency through the SUR approach. Risk and efficiency levels are as follows; Risk figures by applying three potential risk indicators and efficiency levels through The Data Enveloping Analysis (DEA) approach. The study will also apply the methodology in two different scenarios: first, with Islamic banks; and second, with conventional banks. This step is taken in order to present comparable results amongst the different banking systems, which would produce clearer, wider and more understandable findings. Sample: The study covers a sample of major banks in the MENA area for the period spanning 2006–2015. Countries included Saudi Arabia, Kuwait, Qatar, Bahrain, United Arab Emirates, Jordan, Turkey, Egypt, Tunisia and Sudan. Results: After using two proxies to measure credit risk, the study has found that credit risk in Islamic and conventional banks is similar. A slight rise in loan loss reserve for conventional and a slight rise in non-performing loans in Islamic. The overall results show a similar credit risk levels in both Islamic and conventional banks in MENA. Insolvency risk was different, as Islamic banks reported higher risk levels compared to conventional banks. Z scores were higher in conventional banks indicating that insolvency risk in Islamic banks was higher. The study has found that effici…
abstract: Purpose: The main aim of this study is to address the current gap in banking risk and efficiency literature by investigating risk and efficiency levels, identify risk and efficiency determinants. This thesis examines banking risk from one side and efficiency from another. The study also provides a comparative study between Islamic and conventional banking in an effort to provide clear, wide, understandable results. Methodology: The study’s methodology will be applied according to three main steps: first, estimating risk and efficiency levels. Second, investigating risk and efficiency determinants. And finally, identifying those potential variables affecting risk and efficiency through the SUR approach. Risk and efficiency levels are as follows; Risk figures by applying three potential risk indicators and efficiency levels through The Data Enveloping Analysis (DEA) approach. The study will also apply the methodology in two different scenarios: first, with Islamic banks; and second, with conventional banks. This step is taken in order to present comparable results amongst the different banking systems, which would produce clearer, wider and more understandable findings. Sample: The study covers a sample of major banks in the MENA area for the period spanning 2006–2015. Countries included Saudi Arabia, Kuwait, Qatar, Bahrain, United Arab Emirates, Jordan, Turkey, Egypt, Tunisia and Sudan. Results: After using two proxies to measure credit risk, the study has found that credit risk in Islamic and conventional banks is similar. A slight rise in loan loss reserve for conventional and a slight rise in non-performing loans in Islamic. The overall results show a similar credit risk levels in both Islamic and conventional banks in MENA. Insolvency risk was different, as Islamic banks reported higher risk levels compared to conventional banks. Z scores were higher in conventional banks indicating that insolvency risk in Islamic banks was higher. The study has found that effici…
author: Alqahtani, Faisal
language: eng
date published: 2018-01-01T08:00:00Z
date modified: 2026-07-24T03:50:03Z
provider: University of Plymouth
publisher: Networked Digital Library of Theses and Dissertations
type: WebPage
source organization: University of Plymouth