Publication:

Are Islamic banks suffering from a model misfit? Comparison with cooperative banks

Show simple item record
DC FieldValue
dc.contributor.authorRosana Gulzar
dc.contributor.authorMohamed Ariff Abdul Kareem
dc.contributor.authorMansor H. Ibrahim
dc.date.accessioned2021-07-28T02:55:19Z
dc.date.available2021-07-28T02:55:19Z
dc.date.issued2020
dc.description.abstractFor the first time, this study investigates whether, in mimicking conventional banks, Islamic banks have become less stable than their theoretical equivalent: cooperative banks in Europe. Theoretically, the prohibition of interest should have pushed Islamic banks towards mutuality and profit-sharing, which have been argued as stabilising. In practice, however, banks are pushed for growth under a debt-driven commercial banking model, which is not only antithetical to the Shariah but is also destabilising. This may explain why empirical findings are still divergent in Islamic banking stability studies. Our study employs the generalised method of moments (GMM) system to compare the stability of 37 Islamic banks against 1,536 cooperative banks in Europe during the 2008 crisis and post-non-crisis years. Interestingly, we found consistent and significant evidence that Islamic banks are less stable than cooperative banks in both macroeconomic conditions. This has significant policy implications, the most important of which is to steer reform efforts away from refurbishing Islamic commercial banks and towards building an entirely new Islamic cooperative bank, based on the model in Europe.en_US
dc.identifier.citationGulzar, R., Ibrahim, M. H., & Abdul Kareem, M. A. (2020). Are Islamic banks suffering from a model misfit? Comparison with cooperative banks. Journal of Islamic Monetary Economics and Finance, 6(2), 325-352. https://doi.org/10.21098/jimf.v6i2.1086en_US
dc.identifier.doihttps://doi.org/10.21098/jimf.v6i2.1086
dc.identifier.urihttps://ikr.inceif.org/handle/INCEIF/3403
dc.languageEnglish
dc.language.isoengen_US
dc.publisherBank Indonesia Instituteen_US
dc.rights2020. Bank Indonesia Institute
dc.sourceSEDONA
dc.subjectIslamicen_US
dc.subjectCommercialen_US
dc.subjectCooperativeen_US
dc.subjectBankingen_US
dc.subjectStabilityen_US
dc.titleAre Islamic banks suffering from a model misfit? Comparison with cooperative banksen_US
dc.typeJournal Articleen_US
dlc.maintopicIslamic bankingen_US
dspace.entity.typePublication
ikr.doctypeScholarly Works
ikr.topic.maintopicIslamic bankingen_US
relation.isAuthorOfPublicationa45f0c66-a9b7-4f24-b073-1c875276163a
relation.isAuthorOfPublicationa45f0c66-a9b7-4f24-b073-1c875276163a
relation.isAuthorOfPublicationa45f0c66-a9b7-4f24-b073-1c875276163a
relation.isAuthorOfPublication.latestForDiscoverya45f0c66-a9b7-4f24-b073-1c875276163a
Appears in Collections
Journal Article
Files

Abstract View

2653731

View & Download

167753