Do Islamic Banks Outperform Commercial Banks? Longitudinal Managerial and Profitability Efficiencies and Risk Management

Do Islamic Banks Outperform Commercial Banks? Longitudinal Managerial and Profitability Efficiencies and Risk Management

This study assess the managerial efficiency and profitability efficiency of 14 commercial banks and 9 Islamic banks in Malaysia using a dynamic DEA model with network structure within the slacks-based measure (the DNSBM model). In estimating the efficiencies, we also take into consideration two risk...

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Main Authors: Qian, Long Kweh, Wen-Min, Lu, Mohd Hisyam, Ghazali @ Mohd Zain, Noor Azlinna, Azizan
Format: Conference or Workshop Item
Language:English
Published: 2014
Subjects:
HG Finance
Online Access:http://umpir.ump.edu.my/id/eprint/6133/
http://umpir.ump.edu.my/id/eprint/6133/1/ftech-2014-kweh-Do_Islamic_Banks.pdf
id ump-6133
recordtype eprints
spelling ump-61332018-05-02T06:07:34Z http://umpir.ump.edu.my/id/eprint/6133/ Do Islamic Banks Outperform Commercial Banks? Longitudinal Managerial and Profitability Efficiencies and Risk Management Qian, Long Kweh Wen-Min, Lu Mohd Hisyam, Ghazali @ Mohd Zain Noor Azlinna, Azizan HG Finance This study assess the managerial efficiency and profitability efficiency of 14 commercial banks and 9 Islamic banks in Malaysia using a dynamic DEA model with network structure within the slacks-based measure (the DNSBM model). In estimating the efficiencies, we also take into consideration two risk factors: asset risk and liability risk. Moreover, t his study examines the impact of risk management on operating performance using truncated regression with a bootstrapping procedure for the period 2008-2012. The efficiency scores show that our sampled banks should first focus on improving their managerial efficiency, and then their profitability efficiency to enhance their overall operating performance. The results also show that the risk measures have significant impacts on bank efficiency. Islamic banks have better managerial efficiency but lower profitability efficiency. We also include frontier projections of banks that highlight areas of focus. Our regression analysis reveals that the size and independence of risk management committee are significantly positively associated with operating performance. However, the number of meeting conducted by risk management committee has a si gnificantly inverse relationship with operating performance. Overall, bank managers should manage well risks to gain a competitive advantage and ultimately to achieve better operating performance. 2014 Conference or Workshop Item PeerReviewed application/pdf en http://umpir.ump.edu.my/id/eprint/6133/1/ftech-2014-kweh-Do_Islamic_Banks.pdf Qian, Long Kweh and Wen-Min, Lu and Mohd Hisyam, Ghazali @ Mohd Zain and Noor Azlinna, Azizan (2014) Do Islamic Banks Outperform Commercial Banks? Longitudinal Managerial and Profitability Efficiencies and Risk Management. In: 16th Malaysian Finance Association Conference 2014, 4-6 June 2014 , Kuala Lumpur. .
repository_type Digital Repository
institution_category Local University
institution Universiti Malaysia Pahang
building UMP Institutional Repository
collection Online Access
language English
topic HG Finance
spellingShingle HG Finance
Qian, Long Kweh
Wen-Min, Lu
Mohd Hisyam, Ghazali @ Mohd Zain
Noor Azlinna, Azizan
Do Islamic Banks Outperform Commercial Banks? Longitudinal Managerial and Profitability Efficiencies and Risk Management
description This study assess the managerial efficiency and profitability efficiency of 14 commercial banks and 9 Islamic banks in Malaysia using a dynamic DEA model with network structure within the slacks-based measure (the DNSBM model). In estimating the efficiencies, we also take into consideration two risk factors: asset risk and liability risk. Moreover, t his study examines the impact of risk management on operating performance using truncated regression with a bootstrapping procedure for the period 2008-2012. The efficiency scores show that our sampled banks should first focus on improving their managerial efficiency, and then their profitability efficiency to enhance their overall operating performance. The results also show that the risk measures have significant impacts on bank efficiency. Islamic banks have better managerial efficiency but lower profitability efficiency. We also include frontier projections of banks that highlight areas of focus. Our regression analysis reveals that the size and independence of risk management committee are significantly positively associated with operating performance. However, the number of meeting conducted by risk management committee has a si gnificantly inverse relationship with operating performance. Overall, bank managers should manage well risks to gain a competitive advantage and ultimately to achieve better operating performance.
format Conference or Workshop Item
author Qian, Long Kweh
Wen-Min, Lu
Mohd Hisyam, Ghazali @ Mohd Zain
Noor Azlinna, Azizan
author_facet Qian, Long Kweh
Wen-Min, Lu
Mohd Hisyam, Ghazali @ Mohd Zain
Noor Azlinna, Azizan
author_sort Qian, Long Kweh
title Do Islamic Banks Outperform Commercial Banks? Longitudinal Managerial and Profitability Efficiencies and Risk Management
title_short Do Islamic Banks Outperform Commercial Banks? Longitudinal Managerial and Profitability Efficiencies and Risk Management
title_full Do Islamic Banks Outperform Commercial Banks? Longitudinal Managerial and Profitability Efficiencies and Risk Management
title_fullStr Do Islamic Banks Outperform Commercial Banks? Longitudinal Managerial and Profitability Efficiencies and Risk Management
title_full_unstemmed Do Islamic Banks Outperform Commercial Banks? Longitudinal Managerial and Profitability Efficiencies and Risk Management
title_sort do islamic banks outperform commercial banks? longitudinal managerial and profitability efficiencies and risk management
publishDate 2014
url http://umpir.ump.edu.my/id/eprint/6133/
http://umpir.ump.edu.my/id/eprint/6133/1/ftech-2014-kweh-Do_Islamic_Banks.pdf
first_indexed 2023-09-18T22:01:38Z
last_indexed 2023-09-18T22:01:38Z
_version_ 1777414437707186176

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