Islamic Bank Deposits during COVID-19 Pandemic: A Spatial Finance Approach

Ahmad Tibrizi Soni Wicaksono ()
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Ahmad Tibrizi Soni Wicaksono: Faculty of Economics Universitas Islam Negeri Maulana Malik Ibrahim Malang Jalan Gajayana 50, Malang 65144 INDONESIA.

Jurnal Ekonomi Malaysia, 2022, vol. 56, issue 1, 135-149

Abstract: This study aims to determine factors affecting deposits in banks during COVID-19 pandemic by employing a spatial finance approach on a sample of Islamic Rural Banks in the Indonesian archipelago. The results showed that the COVID-19 pandemic, capital financing, and bank asset had a spatial influence on bank deposits. Specifically, while COVID-19 pandemic reduces bank deposits, capital financing and bank assets increase these. Using Spatial Lag Model and Local Indicator of Spatial Autocorrelation through Spatial Rate Analysis, the study further found that there is a potential spillover effect in certain provinces based on the bank deposit relationship with COVID-19, financing and bank assets. This implies that the three factors tend to spatially affect the socio-economic activities of the neighboring areas of certain provinces. This study may shed some light for the government in determining post-COVID-19 economic recovery policies using a geographical approach in providing information on financial interactions between regions.

Keywords: Covid-19; Indonesian archipelago; Islamic banking; Islamic rural bank; Spatial finance; spillover effects (search for similar items in EconPapers)
JEL-codes: C31 G21 R12 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:ukm:jlekon:v:56:y:2022:i:1:p:135-149

DOI: 10.17576/JEM-2022-5601-10

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