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Efficiency convergence in Islamic and conventional banks

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Efficiency convergence in Islamic and conventional banks. / Izzeldin, M.; Johnes, J.; Ongena, S. et al.
In: Journal of International Financial Markets, Institutions and Money, Vol. 70, 101279, 01.01.2021.

Research output: Contribution to Journal/Magazine › Journal article › peer-review

Harvard

Izzeldin, M, Johnes, J, Ongena, S, Pappas, V & Tsionas, M 2021, 'Efficiency convergence in Islamic and conventional banks', Journal of International Financial Markets, Institutions and Money, vol. 70, 101279. https://doi.org/10.1016/j.intfin.2020.101279

APA

Izzeldin, M., Johnes, J., Ongena, S., Pappas, V., & Tsionas, M. (2021). Efficiency convergence in Islamic and conventional banks. Journal of International Financial Markets, Institutions and Money, 70, Article 101279. https://doi.org/10.1016/j.intfin.2020.101279

Vancouver

Izzeldin M, Johnes J, Ongena S, Pappas V, Tsionas M. Efficiency convergence in Islamic and conventional banks. Journal of International Financial Markets, Institutions and Money. 2021 Jan 1;70:101279. Epub 2020 Dec 29. doi: 10.1016/j.intfin.2020.101279

Author

Izzeldin, M. ; Johnes, J. ; Ongena, S. et al. / Efficiency convergence in Islamic and conventional banks. In: Journal of International Financial Markets, Institutions and Money. 2021 ; Vol. 70.

Bibtex

@article{4ebab76793f24db28a3544be477b9565,
title = "Efficiency convergence in Islamic and conventional banks",
abstract = "This paper examines how efficiency dynamics of Islamic and conventional banks compare and how they are converging across different countries. We employ both parametric and non-parametric methods to analyse a panel of Islamic and conventional banks from 23 countries during the period 1999 to 2014. Parametric methods (stochastic frontiers methods) shows that both steady state efficiency and the speed of convergence of Islamic and conventional banks are similar. A non-parametric framework (classification trees) identifies a varying degree of alignment between the Islamic and conventional banking model across countries, which could explain the plurality in conclusions in the Islamic/conventional bank efficiency debate. We find that the alignment between the two bank types is positively related to the country's financial depth, transparency, economic stability and banking concentration. At the bank level, the alignment in the two banking systems is associated with higher income diversification, liquidity, profitability and financial stability. ",
keywords = "Bank efficiency, Classification trees, Conditional-convergence, Islamic banks, Random parameter estimation",
author = "M. Izzeldin and J. Johnes and S. Ongena and V. Pappas and M. Tsionas",
year = "2021",
month = jan,
day = "1",
doi = "10.1016/j.intfin.2020.101279",
language = "English",
volume = "70",
journal = "Journal of International Financial Markets, Institutions and Money",
issn = "1042-4431",
publisher = "Elsevier BV",

}

RIS

TY - JOUR

T1 - Efficiency convergence in Islamic and conventional banks

AU - Izzeldin, M.

AU - Johnes, J.

AU - Ongena, S.

AU - Pappas, V.

AU - Tsionas, M.

PY - 2021/1/1

Y1 - 2021/1/1

N2 - This paper examines how efficiency dynamics of Islamic and conventional banks compare and how they are converging across different countries. We employ both parametric and non-parametric methods to analyse a panel of Islamic and conventional banks from 23 countries during the period 1999 to 2014. Parametric methods (stochastic frontiers methods) shows that both steady state efficiency and the speed of convergence of Islamic and conventional banks are similar. A non-parametric framework (classification trees) identifies a varying degree of alignment between the Islamic and conventional banking model across countries, which could explain the plurality in conclusions in the Islamic/conventional bank efficiency debate. We find that the alignment between the two bank types is positively related to the country's financial depth, transparency, economic stability and banking concentration. At the bank level, the alignment in the two banking systems is associated with higher income diversification, liquidity, profitability and financial stability.

AB - This paper examines how efficiency dynamics of Islamic and conventional banks compare and how they are converging across different countries. We employ both parametric and non-parametric methods to analyse a panel of Islamic and conventional banks from 23 countries during the period 1999 to 2014. Parametric methods (stochastic frontiers methods) shows that both steady state efficiency and the speed of convergence of Islamic and conventional banks are similar. A non-parametric framework (classification trees) identifies a varying degree of alignment between the Islamic and conventional banking model across countries, which could explain the plurality in conclusions in the Islamic/conventional bank efficiency debate. We find that the alignment between the two bank types is positively related to the country's financial depth, transparency, economic stability and banking concentration. At the bank level, the alignment in the two banking systems is associated with higher income diversification, liquidity, profitability and financial stability.

KW - Bank efficiency

KW - Classification trees

KW - Conditional-convergence

KW - Islamic banks

KW - Random parameter estimation

U2 - 10.1016/j.intfin.2020.101279

DO - 10.1016/j.intfin.2020.101279

M3 - Journal article

VL - 70

JO - Journal of International Financial Markets, Institutions and Money

JF - Journal of International Financial Markets, Institutions and Money

SN - 1042-4431

M1 - 101279

ER -