BANKING SHORT- AND LONG-TERM STABILITY: A COMPARATIVE STUDY BETWEEN ISLAMIC AND CONVENTIONAL BANKS IN GCC COUNTRIES

Rihab Ben Slimen, Fethi Belhaj and Manel Hadriche ()
Additional contact information
Manel Hadriche: Manar University, Tunisia

Copernican Journal of Finance & Accounting, 2021, vol. 10, issue 4, 139-158

Abstract: This research empirically assesses the contribution of Islamic finance to the financial stability of banks. The empirical analysis is based on the annual data related to 103 banks (51 Islamic banks and 52 conventional banks) operating in six countries of the Gulf Cooperation Council (GCC) region during the period 2006–2015. The LADR ratio was computed and used to measure banks stability in the short term, and the Z -score was used to assess long-term stability. The results show that, overall, Islamic banks are financially more stable in the short-term but less stable in the long term than conventional banks. The comparative analysis of the financial stability determinants in the two systems shows that these determinants contribute differently to the short- and long-term financial stability of Islamic and conventional banks. This is due to the dissimilarities in the two operating principles.

Keywords: Islamic finance; Islamic banks; conventional banks; financial stability; Z -score; LADR ratio (search for similar items in EconPapers)
Date: 2021
References: Add references at CitEc
Citations:

Downloads: (external link)
https://apcz.umk.pl/CJFA/article/view/37581/31721 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpn:umkcjf:v:10:y:2021:i:4:p:139-158

Access Statistics for this article

Copernican Journal of Finance & Accounting is currently edited by Leszek Dziawgo

More articles in Copernican Journal of Finance & Accounting from Uniwersytet Mikolaja Kopernika
Bibliographic data for series maintained by Miroslawa Buczynska ().