Efficiency and bank margins: a comparative analysis of Islamic and conventional banks in Yemen
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This paper examines the determinants of bank margins' in the Yemeni banking sector for Islamic and conventional banks. The first objective is to investigate whether there is a significant difference between the margins of conventional and Islamic banks. The second objective is to examine whether efficiency represents an influential factor in determining bank margins for Islamic and conventional banks controlling for other micro and macro variables. The study finds that the overall bank margin in Yemen has steadily decreased during the observation period with the exception of the year 2011. The parametric and non parametric results show that the bank margins are significantly higher for conventional banks than for Islamic banks. The results provide evidence that bank margins are related to neither types of efficiency, but are affected by capitalisation, size, the opportunity cost of the reserve, and liquidity, although the impact is shaped differently for Islamic and conventional banks.
Bank margins , Islamic banks , Conventional banks , Efficiency , Yemen
Shawtari, Fekri Ali and Abdul Kareem, Mohamed Ariff and Shaikh Abdul Razak, Shaikh Hamzah. (2018). Efficiency and bank margins: a comparative analysis of Islamic and conventional banks in Yemen. Journal of Islamic Accounting and Business Research, https://doi.org/10.1108/JIABR-07-2015-0033
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