Asset diversification and bank performance: Evidence from three Asian countries with a dual banking system

Naiwei Chen, Hsin-Yu Liang and Min-Teh Yu

Pacific-Basin Finance Journal, 2018, vol. 52, issue C, 40-53

Abstract: This study examines the effect of asset diversification on bank performance in three Asian countries with a dual banking system from 2006 to 2012. We find that diversification generally has a negative effect on the performance of conventional banks, but a minimal effect on that of Islamic banks. Considering bank size, diversification positively affects the profitability of large Islamic and conventional banks, and such a positive effect is more pronounced among Islamic banks.

Keywords: Diversification; Bank performance; Islamic banking; Panel data (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (17)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:pacfin:v:52:y:2018:i:c:p:40-53

DOI: 10.1016/j.pacfin.2018.02.007

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