PhD

This thesis examines the relationship between bank competition and financial intermediation cost in the dual banking system. In literature, such relationship has been substantially studied for the conventional banking system. Yet, exploring it in dual system is still missing. This examination is important for two main reasons. First, the changing market structure within the dual banking jurisdictions and its sequences on various banking aspects. Second, the high intermediation cost of Islamic banks compared to their conventional peers, which is well documented in literature, and the possible role of changes in market structure on such cost. By leveraging on a sample of 387 commercial banks (85 of them are Islamic) from 12 dual banking jurisdictions across 20 years (1999-2018), this empirical study tries to fill an important research gap in the dual banking system literature by studying the impact of bank competition on financial intermediation cost, represented by bank margin, within dual banking system from three main perspectives.