What’s in it for Me? A Primeron Differences between Islamic and Conventional Finance in Malaysia

Olga Krasicka and Sylwia Nowak

No 2012/151, IMF Working Papers from International Monetary Fund

Abstract: What attracts conventional investors to Islamic financial instruments? We answer this question by comparing Malaysian Islamic and conventional security prices and their response to macrofinancial factors. Our analysis suggests that Islamic and conventional bond and equity prices are driven by common factors. Likewise, especially in recent years, Islamic banks have responded to economic and financial shocks in the same way as conventional banks, suggesting that the gap between Islamic and conventional financial practices is shrinking.

Keywords: WP; bank; market share; return on equity; Islamic banks; conventional banks; Sukuk; Malaysia; bank Islam Malaysia Berhard; bond return equation; equity index; securities commission Malaysia; insurance corporation; Islamic banking; Islamic finance; Bonds; Stocks; Global; East Asia (search for similar items in EconPapers)
Pages: 22
Date: 2012-06-01
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Citations: View citations in EconPapers (21)

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