The Effect of the 2008 Global Financial Crisis on the Capital Structures of Conventional and Islamic Banks in the Gulf Cooperation Council Region
Talla M. Aldeehani
Additional contact information
Talla M. Aldeehani: College of Business Administration, Kuwait University, Kuwait.
International Journal of Economics and Financial Issues, 2019, vol. 9, issue 2, 12-23
The paper investigates the determinants of capital structures of conventional banks (CBs) and Islamic banks (IBs) before and after the 2008 global financial crisis. We gathered data on the banking industry of the Gulf Cooperation Countries for the period 2003 - 2016 covering 53 banks, 10 of which are Islamic. Our results indicate that the crisis had significant effects on bank liquidity, lending, profitability, size and growth. They also indicate that the capital structures of CBs and IBs, before and after the crisis are determined differently. Due to the contractual setup and capital adequacy requirements, we believe that IBs, had it not been for the faith, do not enjoy enough maneuverability space to enhance shareholders wealth. Accordingly, questions regarding how much IBs’ clients know about faith and the contradicting provisions of Islamic law in the context of investment decision making were raised. Practical and theoretical implications and recommendations are discussed.
Keywords: s Capital structure; Islamic banks; financial crisis (search for similar items in EconPapers)
JEL-codes: G01 G21 G32 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eco:journ1:2019-02-2
Access Statistics for this article
International Journal of Economics and Financial Issues is currently edited by Ilhan Ozturk
More articles in International Journal of Economics and Financial Issues from Econjournals
Bibliographic data for series maintained by Ilhan Ozturk ().