Performance Evaluation of Islamic Banking Services Industry: Evidence from GCC

Muhammad Hanif

No 379un_v1, OSF Preprints from Center for Open Science

Abstract: This study documents the comparative financial performance of the Islamic Banking Services Industry (IBSI) in the Gulf Cooperation Council (GCC) region. After drawing the performance evaluation framework (based on the CAMEL framework), the research conducted data analysis of the Islamic Banking Services Industry (IBSI) in the GCC region for 31 quarters (2013Q4–2021Q4). The analysis examines capital adequacy, asset quality, management performance, earnings, and liquidity management. Objectively classified data trends are reported through graphs. Additionally, the research documents internal determinants of financial performance. Findings suggest that the GCC-IBSI has shown overall progress in achieving primary objectives (commercial performance), including healthy capital adequacy, cost control, equity returns, and liquidity management. Capital adequacy, cost control, and liquidity management significantly contribute to financial performance. Managerial implications include cost control, reduction in non-performing loans, and prudent liquidity management. There exist opportunities in the GCC-IBSI for investors, given the mismatch in demand and supply of Islamic financial services. This study contributes to the literature by documenting findings on the achievements of the primary objective of IBSI in multiple GCC-IBSI markets comparatively.

Date: 2024-11-18
New Economics Papers: this item is included in nep-ara and nep-isf
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:osf:osfxxx:379un_v1

DOI: 10.31219/osf.io/379un_v1

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