Liquidity Risk and Performance of Banking System in Malaysia

2013 ◽  
Author(s):  
Ameira Nur Amila Sohaimi
Keyword(s):  
Banking System ◽  
Liquidity Risk ◽  
And Performance

Liquidity risk and performance of banking system

2012 ◽  
Vol 20 (2) ◽  
pp. 182-195 ◽  
Author(s):  
Ahmed Arif ◽  
Ahmed Nauman Anees
Keyword(s):  
Banking System ◽  
Liquidity Risk ◽  
And Performance

scholarly journals Analysis of The Influence of Liquidity, Credit and Operational Risk, in Indonesian Islamic Bank’s Financing for The Period 2007-2013

2015 ◽  
Vol 17 (3) ◽  
pp. 279 ◽  
Author(s):  
Ousmane Diallo ◽  
Tettet Fitrijanti ◽  
Nanny Dewi Tanzil
Keyword(s):  
Credit Risk ◽  
Causal Relationship ◽  
Risk Sharing ◽  
Banking Sector ◽  
Panel Data Analysis ◽  
Banking System ◽  
Liquidity Risk ◽  
Operational Risk ◽  
Islamic Banking ◽  
Islamic Bank

The purpose of this paper is to analyze the influence of credit, liquidity and operational risks in six Indonesian’s islamic banking financing products namely mudharabah, musyarakah, murabahah, istishna, ijarah and qardh, in order to try to discover whether or not Indonesian islamic banking is based on the “risk-sharing” system. This paper relies on a fixed effect model test based on the panel data analysis method, focusing on the period from 2007 to 2013. The research is an exploratory and descriptive study of all the Indonesian islamic banks that were operating in 2013. The results of this study show that the Islamic banking system in Indonesia truly has banking products based on “risk-sharing.” We found out that credit, operational and liquidity risks as a whole, have significant influence on mudarabah, musyarakah, murabahah, istishna, ijarah and qardh based financing. There is a correlation between the credit risk and mudarabah based financing, and no causal relationship between the credit risk and musharaka, murabahah, ijarah, istishna and qardh based financing. There is also correlation between the operational risk and mudarabah and murabahah based financing, and no causal relationship between the operational risk and musharaka, istishna, ijarah and qardh based financing. There is correlation between the liquidity risk and istishna based financing, and no causal relationship between the liquidity risk and musharaka, mudarabah, murabahah, ijarah and qardh based financing. A major implication of this study is the fact that there is no causal relationship between the credit risk and musharakah based financing, which is the mode of financing where the islamic bank shares the risk with its clients, but there is an influence of credit risk toward mudarabah mode financing, a financing mode where the Islamic bank bears all the risk. These findings can lead us to conclude that the Indonesian Islamic banking sector is based on the “risk sharing” system.

PROSPECTS OF ISLAMIC BANKING: REFLECTIONS FROM PAKISTAN

2011 ◽  
Vol 01 (02) ◽  
pp. 125-134
Author(s):  
Muhammad Akram ◽  
Mamoona Rafique ◽  
Hassan Mobeen Alam
Keyword(s):  
Growth Parameters ◽  
Banking System ◽  
Basic Knowledge ◽  
Islamic Banking ◽  
Muslim Country ◽  
Banking Services ◽  
And Performance ◽  
Corporate Social ◽  
Near Future

This study examines the growth and development phases as well as prospects of Islamic banking in Pakistan. The role of Islamic banking is explained with special regards to corporate social responsibility (CSR) as now days this concept is growing vastly. Awareness in public also has been growing and people are moving towards Islamic banking system. As we live in a Muslim country so it is very essential to have some basic knowledge about the Islamic banking. In this paper growth and performance of Islamic banking is discussed and compared among the financial years from 2003 to 2010 in terms of growth parameters like assets, deposits, sources and uses of funds. The performance indicators are also discussed to evaluate the growth and performance of Islamic banking system. In the last eight years, Islamic banking paved with the rapid market share of banking services. Moreover the efforts made by the central bank in Pakistan (SBP) are also remarkable in growth of Islamic banking. By seeing the present growth of Islamic banking, it is anticipated that in near future, Islamic banking with get major share in banking industry in Pakistan.

Does the deposit structure affect Islamic bank’s maturity transformation activities? The implications of IFSB liquidity guidelines

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Wassim Ben Ayed ◽  
Rim Ammar Lamouchi ◽  
Suha M. Alawi
Keyword(s):  
Risk Management ◽  
Positive Impact ◽  
Generalized Method Of Moments ◽  
Banking System ◽  
Liquidity Risk ◽  
Profit Sharing ◽  
Arab Countries ◽  
Mena Region ◽  
Content Type ◽  
Deposit Structure

Purpose The purpose of this study is to investigate factors influencing the net stable funding ratio (NSFR) in the Islamic banking system. More specifically, the authors analyze the impact of the deposit structure on the liquidity ratio using the two-step generalized method of moments approach during the 2000–2014 period. Design/methodology/approach Based on IFSB-12 and the GN-6, the authors calculated the NSFR for 35 Islamic banks operating in the Middle East and North Africa (MENA) region. Findings The findings of this study show the following: first, ratio of profit-sharing investment accounts have a positive impact on the NSFR, while ratio of non profit-sharing investment accounts increase the maturity transformation risk; second, the results highlight that asset risk, bank capital and the business cycle have a positive impact on the liquidity ratio, while the returns on assets, bank size and market concentration have a negative impact; and third, these results support the IFSB’s efforts in developing guidelines for modifying the NSFR to enhance the liquidity risk management of institutions offering Islamic financial services. Research limitations/implications The most prominent limitation of this research is the availability of data. Practical implications These results will be useful for authorities and policy makers seeking to clarify the implications of adopting the liquidity requirement for banking behavior. Originality/value This study contributes to the knowledge in this area by improving our understanding of liquidity risk management during liquidity stress periods. It analyzes the modified NSFR that was adopted by the IFSB. Besides, this study fills a gap in the literature. Previous studies have used the conventional ratios to determinate the main factors of the maturity transformation risk in a full-fledged Islamic bank based on an early version of NSFR. Finally, most studies focus on the NSFR as proposed by the Basel Committee, whereas the authors investigate the case of the dual-banking system in the emerging economies of seven Arab countries in the MENA region.

Liquidity Risk and Performance: The Case of Bahrain and Malaysian Banks

2015 ◽  
Vol 8 (2) ◽  
pp. 95-111 ◽  
Author(s):  
Norazwa Zolkifli ◽  
Mohamad Hamid ◽  
Hawati Janor
Keyword(s):  
Liquidity Risk ◽  
And Performance

Liquidity risk management: conventional versus Islamic banking system in Egypt

2017 ◽  
Vol 8 (1) ◽  
pp. 100-128 ◽  
Author(s):  
Nevine Sobhy Abdel Megeid
Keyword(s):  
Risk Management ◽  
Banking System ◽  
Liquidity Risk ◽  
Policy Decision ◽  
Financial Statements ◽  
Decision Makers ◽  
Content Type ◽  
Bank Regulations ◽  
Conventional Banks ◽  
Practical Implications

Purpose This research aims to analyze and compare the effectiveness of liquidity risk management of Islamic and conventional banking in Egypt to ascertain which of the two banking systems are performing better. Design/methodology/approach A sample of six conventional banks (CBs) and two Islamic banks (IBs) in Egypt was selected. Using the liquidity ratios, the investigation involves analyzing the financial statements for the period of 2004-2011. The data were obtained from Bank scope database. Findings The research found that in Egypt, CBs perform better in terms of liquidity risk management than IBs. The liquidity risk management significant differences between IBs and CBs could be attributed more cash availability to CBs than to IBs, in addition, Egyptian Central Bank regulations on capital and liquidity requirements for IBs disconcert IBs’ performance. Practical implications This research facilitates the bankers, academician, scholars and bankers to have an alluded picture about Egyptian banking developments in liquidity risk management. The results can be used by bankers’ policy decision-makers to improve and enhance their consideration for liquidity risk management. Originality/value This research covers a period and a country that compares CBs’ and IBs’ liquidity risk management. Its value is attributed to the increasing differentiation between CBs and IBs.

scholarly journals Capital Adequacy and its Impact on Banking Liquidity Risk Applied Study in the Bank of the Islamic National and Commercial Iraqi for the Period (2012-2017)

2019 ◽  
Vol 27 (2) ◽  
pp. 67-79
Author(s):  
Qassem Ali Omran
Keyword(s):  
Commercial Bank ◽  
Alternative Hypothesis ◽  
Banking System ◽  
Liquidity Risk ◽  
Capital Adequacy ◽  
P Value ◽  
Anova Analysis ◽  
Applied Study ◽  
Capital Adequacy Ratio ◽  
Important Means

The aim of this paper is to highlight one of the risks facing the banking system in general and the Iraqi in particular, both Islamic and commercial, resulting from the low liquidity of banks from their safe levels, which expose the bank to a number of effects, especially when exposed to sudden withdrawals through measuring and analyzing the banking liquidity risk of banking and the statement The most important means used to processing  these risks, including the adequacy of capital according to the Basel II Accord. Two banks, the National Islamic Bank and the Commercial Bank of Iraq, were selected and the indicators of liquidity risk were used. Statement of the Effect of the Capital Adequacy Tool as a Tool that Contributes to the Absorption of Banking Risks and their Effects in Mitigating Liquidity Risk The indicators were analyzed and tested by testing F, P-value and impact statement through the R2 parameter using the ANOVA analysis. There is a significant effect of the capital adequacy ratio on the liquidity risk of banks and both banks to varying degrees on the basis of which the alternative hypothesis was accepted. The paper also reached the recommendations of the most important of which is the need to achieve a balance between the size of the balances utilized in the various banking fields and what is maintained, Exceed the capital adequacy ratios for the specified rates by the Central Bank of Iraq.  

scholarly journals A Comparison between Islamic Banking and Conventional Banking Sector in Pakistan

2012 ◽  
Vol 4 (4) ◽  
pp. 195-204 ◽  
Author(s):  
Abdul Hafeez Quresh ◽  
Kashif Ur Rehman .
Keyword(s):  
Banking Sector ◽  
Banking System ◽  
Islamic Banking ◽  
Test Tool ◽  
Financial Benefits ◽  
The World ◽  
Banking Structure ◽  
And Performance ◽  
Conventional Banks ◽  
Marketing Approach

The Islamic banking system is attaining enormous development. Several modern international conventional banks were also enchanting significant concern and starting Islamic banking branches in their organizations, which work in compliance with the specific Islamic Shariah principles in a number of states of Pakistan. The Islamic banking structure is bizarrely facing gigantic contest by the Islamic banking sector all over the world as well as from the well-known International commercial banks that hold out services and products of IB. It is an attempt for exploration and investigation of the extensive and essential factors, which persuade consumers to choose the Islamic banking or conventional banking and the function of demographic features, which track consumers to the assortment of IB or CB in Pakistan. Sample of 341 respondents has been used in this study mainly focused on non-probability convenience test tool. Pre-institute 5 point likert survey instrument ranging from 5 to 1 was applied to gather data. The conclusion reveals that there are countless factors other than religious perception like employee and customer interactions, convenience, reputation, financial benefits & services, and technology, which are fundamental for the consumers for the assortment of Islamic or conventional banking. The demographic characteristics of the respondents also have a significant impact. The authors expect that the crux of this study will explore new ways for the Islamic banking system to emphasis on specific emerging factors to enhance the efficiency and performance of the Islamic banking system in Pakistan. There will be enormous advantage for executives of IBs & CBs in developing marketing approach.

scholarly journals Data Quality in Banking System: Case of Azerbaijan

2018 ◽  
Vol 7 (2) ◽  
pp. 1-8
Author(s):  
Ali Dadashzade
Keyword(s):  
Sensitivity Analysis ◽  
Corporate Governance ◽  
Data Quality ◽  
Banking System ◽  
Marketing Strategies ◽  
Personal View ◽  
Quality Problem ◽  
Quality Issue ◽  
And Performance ◽  
Hidden Data

Data quality in banking and financial sector is one of the most researched topics nowadays. With the increasing regulatory burden and increased importance of targeted sales, data quality directly influences funds and performance of banking system. In this paper, the author is aiming to define universal reasons and causes of data quality problem and apply the case to local Azerbaijani banks taking into account local managers’ personal view based on their banking experience. Key finding of the research is that unintegrated software, wrong data insertion, aging of data with the growing speed of market, corporate governance and inability to calculate true costs of low data quality to the local banks are the reasons of data quality issue in the local banks. Moreover, main costs of the data quality issue are time and money, appearance of hidden data factories, obstacles to apply and measure KPIs, uncorrelations in sensitivity analysis and ineffective marketing strategies.

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