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Determinants of efficiency of Islamic banks: Indonesian evidence

Ahmad Fadlur, Rahman Bayuny and Haron, Razali (2016) Determinants of efficiency of Islamic banks: Indonesian evidence. In: 4th ASEAN International Conference on Islamic Finance (AICIF 2016), 6th-8th December 2016, Melaka. (Unpublished)

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This study attempts to investigate the efficiency of Islamic banks in Indonesia and its determinants over the period of 2004-2014. Eleven full Islamic banks were selected for the sample. This study employs the Data Envelopment Analysis (DEA) in first stage of the analysis based on two inputs (fixed asset and deposits) and one output (financing income). Panel data regression is then employed in the second stage of analysis. This study finds that the efficiency scores of Islamic banks in Indonesia ranged from 61.4% to 96.4% between 2004-2014 with an overall efficiency of 75.6%. Regression analysis suggests that the efficiency of Islamic banks in Indonesia is negatively influenced by factors such as GDP growth, exchange rate and trade freedom while positively related with profitability, financing intensity, capitalization and non-financing expenses.

Item Type: Conference or Workshop Item (Plenary Papers)
Additional Information: 4581/54783
Uncontrolled Keywords: Islamic banks, efficiency, DEA, Indonesia
Subjects: 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. Razali Haron
Date Deposited: 14 Feb 2017 08:32
Last Modified: 21 Feb 2017 15:35
URI: http://irep.iium.edu.my/id/eprint/54783

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