Efficiency, Asset Quality and Stability: Comparative Study of Conventional Banks and Islamic Banks in Southeast Asia

DOI

10.2991/aebmr.k.200305.045How to use a DOI?

Keywords

efficiency, asset quality, stability, conventional canks, Islamic banks

Abstract

This study aims to analyze the differences in efficiency, asset quality, and stability in Islamic banks (Ib) and conventional banks (Cb) in Southeast Asia. To measure the efficiency, it uses DEA analyzing of input and output of Ib and Cb, namely input (total deposits, personnel expense, and fixed assets) and output (loans and non-interest income). Then, to test the quality of assets, this study uses Loan Loss provisions and Loan Loss Reserve. The stability is measured by calculating the Z-Score. This study aims to look at the level of efficiency, asset quality and stability in Islamic banks and conventional banks. Furthermore, this study investigates the differences of those factors to see the extent of which Islamic banks can compete with conventional banks in the Southeast Asia context. The population in this study are conventional banks and Islamic banks in Southeast Asia, namely Indonesia, Malaysia, Brunei Darussalam, the Philippines and Thailand. The type of data is secondary data obtained by Annual Report of each bank. There were 31 conventional banks and 17 Islamic banks, years 2013 – 2017, in Southeast Asia included in this study. The results showed that there were differences in efficiency, asset quality and stability between conventional banks and Islamic banks. Islamic banks were more efficient than conventional banks. Whereas conventional banks were better in terms of Asset quality and stability compared to Islamic banks.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Download article (PDF)

TY  - CONF
AU  - Vanica Serly
AU  - Dian Fitria Handayani
PY  - 2020
DA  - 2020/03/10
TI  - Efficiency, Asset Quality and Stability: Comparative Study of Conventional Banks and Islamic Banks in Southeast Asia
BT  - Proceedings of the 4th Padang International Conference on Education, Economics, Business and Accounting (PICEEBA-2 2019)
PB  - Atlantis Press
SP  - 1
EP  - 7
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.200305.045
DO  - 10.2991/aebmr.k.200305.045
ID  - Serly2020
ER  -