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Determinants of Islamic Banking Profitability in Malaysia

Abduh, Muhamad and Idrees, Yameen (2013) Determinants of Islamic Banking Profitability in Malaysia. Australian Journal of Basic and Applied Sciences, 7 (2). pp. 204-210. ISSN 1991-8178

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Islamic banks were experiencing tremendous growth by showing high profitability level and less affected by the financial turmoil. Thus, the objective of this paper is to investigate the impact of bank-specific as well as industry-specific and macroeconomic indicators upon Islamic banks profitability, particularly in Malaysia, for the period of 2006 to 2010. Using pooled regression analysis, and by taking 10 Islamic banks/windows, the result shows that the bank size is a vital importance in affecting its profitability. In addition, financial market development and market concentration has a significant positive impact in determining profitability. Finally, from the macro-economic variables, inflation has a significant positive impact on Islamic banks’profitability which shows the different nature between Islamic and conventional banks.

Item Type: Article (Journal)
Additional Information: 6777/30037
Uncontrolled Keywords: Profitability, Islamic banking, inflation, pooled regression
Subjects: B Philosophy. Psychology. Religion > BP Islam. Bahaism. Theosophy, etc > BP1 Islam > BP173.75 Islam and economics
H Social Sciences > HG Finance > HG1501 Banking
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button): Institute of Islamic Banking & Finance (IIiBF)
Depositing User: Dr Muhamad Abduh
Date Deposited: 17 May 2013 21:05
Last Modified: 09 Jul 2013 07:17
URI: http://irep.iium.edu.my/id/eprint/30037

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