Islamic Financing and Bank Behaviour in a Dual Banking System: Evidence from Malaysia

Muhamed Zulkhibri

No 2016-8, Working Papers from The Islamic Research and Teaching Institute (IRTI)

Abstract: Abstract The paper examines the cross-sectional differences in the way that Islamic banks respond to base financing rate across bank-specific characteristics in a dual banking system using panel regression methodology. The evidence suggests that the bank-specific characteristics are important for Islamic banking financing behaviour. The Islamic banks financing behaviour is consistent with behaviour of conventional banks that the bank lending operates via banks depending on the level of size, liquidity and capital. The findings also suggest that there is no significant difference between Islamic bank financing and conventional bank lending behaviour with respect to interest rates.

Keywords: Islamic Banks; Base Financing Rate; Bank Financing; Panel Regression Analysis (search for similar items in EconPapers)
JEL-codes: E44 E52 G21 G22 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2016-05-01
New Economics Papers: this item is included in nep-mac and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:ris:irtiwp:2016_008

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