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Competition, stability, and institutional environment: The case of dual banking economies

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dc.contributor.authorWajahat Azmi
dc.contributor.authorZaheer Anwer
dc.contributor.authorMohsin Ali
dc.date.accessioned2024-12-03T04:14:29Z
dc.date.available2024-12-03T04:14:29Z
dc.date.issued2024
dc.description.abstractWe measure the impact of competition and institutional quality on stability for dual banking economies. Our sample comprises 492 banks (109 Islamic and 383 conventional banks) from 17 countries with dual-banking systems. The sample period is from 2005 to 2020. The estimations are performed using Two Step System Generalized Method of Moments approach. Our findings reveal heterogeneous effect of competition on stability. We found the evidence of competition-stability paradigm in case of full sample as well as for Islamic banks. There is no effect of competition on the stability of conventional banks. Furthermore, there is no evidence of size effect in the competition-stability results. The impact of legal institution is insignificant. We also observe that better quality of political and the economic institutions increases the bank stability. We attribute these findings to the conjecture that better political and/or legal institutions improve bank stability by reducing information asymmetry and adverse selection. Finally, we find the evidence that political, legal and economic dimensions of institutions have differential effect on competition-stability relationship. The findings are robust to alternative definitions of competition, stability and different methodological approaches.en_US
dc.identifier.citationAzmi, W., Anwer, Z., Ali, M., & Mohamad, S. (2024). Competition, stability, and institutional environment: The case of dual banking economies. International Journal of Finance & Economics, 29(1), 609-631.en_US
dc.identifier.doihttps://doi.org/10.1002/ijfe.2700
dc.identifier.issn1099-1158
dc.identifier.urihttps://ikr.inceif.edu.my/handle/INCEIF/4135
dc.languageEnglish
dc.language.isoengen_US
dc.publisherJohn Wiley & Sons, Incen_US
dc.rights2024. John Wiley & Sons, Inc
dc.sourceSEDONA
dc.subjectCompetitionen_US
dc.subjectDual bankingen_US
dc.subjectEconomic institutionsen_US
dc.subjectIslamic financeLegal institutionsen_US
dc.subjectPolitical institutionsen_US
dc.subjectStabilityen_US
dc.titleCompetition, stability, and institutional environment: The case of dual banking economiesen_US
dc.typeJournal Articleen_US
dspace.entity.typePublication
ikr.doctypeScholarly Works
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