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Do we need bigger Islamic banks? An assessment of bank stability

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dc.contributor.authorSyed Aun Raza Rizvi
dc.contributor.authorMansor H. Ibrahim
dc.date.accessioned2017-09-19T15:11:32Z
dc.date.available2017-09-19T15:11:32Z
dc.date.issued2017
dc.description.abstractIn this paper, we evaluate from the stability point of view whether Islamic banks should stay small or should be bigger. More specifically, in relating bank stability to bank size, we examine potential non-linear effects of size on bank soundness and the roles regulation plays in strengthening or weakening the size-stability relation using a panel sample of 45 Islamic banks from 13 countries. Our results show that larger Islamic banks are more stable, at least when they surpass a certain threshold size. As regards regulation, activity restrictions and capital stringency play a role in strengthening the stability-size relation. By contrast, the positive stability-size relation is weakened with more private monitoring and supervisory power. Hence, our results point to the benefits of having bigger Islamic banks.They also suggest that, to further enhance the stability implications of larger Islamic banks, policymakers should focus on improving regulation in the forms of activity restrictions and capital stringency.en_US
dc.identifier.citationIbrahim, M. H. & Rizvi, S. A. R. (2017). Do we need bigger Islamic banks? An assessment of bank stability. Journal of Multinational Financial Management, 40, pp. 77-91.
dc.identifier.doihttps://doi.org/10.1016/j.mulfin.2017.05.002
dc.identifier.urihttps://ikr.inceif.edu.my/handle/INCEIF/2690
dc.languageEnglish
dc.language.isoengen_US
dc.publisherScience Directen_US
dc.rights2017. Science Direct
dc.sourceSEDONA
dc.subjectIslamic banking stabilityen_US
dc.subjectBank sizeen_US
dc.subjectSystem GMMen_US
dc.subjectLSDVCen_US
dc.subjectRegulationen_US
dc.titleDo we need bigger Islamic banks? An assessment of bank stabilityen_US
dc.typeJournal Articleen_US
dlc.maintopicIslamic bankingen_US
dspace.entity.typePublication
ikr.doctypeScholarly Works
ikr.topic.maintopicIslamic bankingen_US
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