Abstract
In order to achieve sustainable long-run growth by Islamic banks, it is vital to focus on the risk management practices of Islamic banks, especially in managing credit risk.This study considers both macroeconomic and bank specific variables that affect the credit risk of Islamic banks in Bangladesh and Malaysia. Using ordinary least squares techniques, we find three significant determinants of credit risk in Islamic banks in Bangladesh, namely, the loan to deposit ratio, cost inefficiency, and size. In contrast, two additional variables significantly affect the credit risk of Islamic banks in Malaysia,namely, credit growth and the returns on assets. In addition, we find macroeconomic factors do not exert any significant impact on the nonperforming loans of Islamic banks in either of these countries.
| Original language | English |
|---|---|
| Title of host publication | Contemporary Issues in Islamic Finance |
| Subtitle of host publication | Principles, Progress and Prospects |
| Publisher | Nova Science Publishers |
| Chapter | 7 |
| Pages | 97-108 |
| Number of pages | 12 |
| ISBN (Electronic) | 9781629489063 |
| ISBN (Print) | 9781629489056 |
| Publication status | Published - 1 Jan 2014 |
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Determinants of credit risk in Bangladeshi and Malaysian Islamic banks. / Kabir, Md Nurul; Yasushi, Suzuki.
Contemporary Issues in Islamic Finance: Principles, Progress and Prospects. Nova Science Publishers, 2014. p. 97-108.Research output: Chapter in Book/Report/Conference proceeding › Chapter › Research › peer-review
TY - CHAP
T1 - Determinants of credit risk in Bangladeshi and Malaysian Islamic banks
AU - Kabir, Md Nurul
AU - Yasushi, Suzuki
PY - 2014/1/1
Y1 - 2014/1/1
N2 - In order to achieve sustainable long-run growth by Islamic banks, it is vital to focus on the risk management practices of Islamic banks, especially in managing credit risk.This study considers both macroeconomic and bank specific variables that affect the credit risk of Islamic banks in Bangladesh and Malaysia. Using ordinary least squares techniques, we find three significant determinants of credit risk in Islamic banks in Bangladesh, namely, the loan to deposit ratio, cost inefficiency, and size. In contrast, two additional variables significantly affect the credit risk of Islamic banks in Malaysia,namely, credit growth and the returns on assets. In addition, we find macroeconomic factors do not exert any significant impact on the nonperforming loans of Islamic banks in either of these countries.
AB - In order to achieve sustainable long-run growth by Islamic banks, it is vital to focus on the risk management practices of Islamic banks, especially in managing credit risk.This study considers both macroeconomic and bank specific variables that affect the credit risk of Islamic banks in Bangladesh and Malaysia. Using ordinary least squares techniques, we find three significant determinants of credit risk in Islamic banks in Bangladesh, namely, the loan to deposit ratio, cost inefficiency, and size. In contrast, two additional variables significantly affect the credit risk of Islamic banks in Malaysia,namely, credit growth and the returns on assets. In addition, we find macroeconomic factors do not exert any significant impact on the nonperforming loans of Islamic banks in either of these countries.
UR - http://www.scopus.com/inward/record.url?scp=84953385525&partnerID=8YFLogxK
UR - https://www.novapublishers.com/catalog/product_info.php?products_id=47413
M3 - Chapter
SN - 9781629489056
SP - 97
EP - 108
BT - Contemporary Issues in Islamic Finance
PB - Nova Science Publishers
ER -