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Contribution Details

Type Journal Article
Scope Discipline-based scholarship
Title A survival analysis of islamic and conventional banks
Organization Unit
Authors
  • Vasileios Pappas
  • Steven Ongena
  • Marwan Izzeldin
  • Ana-Maria Fuertes
Item Subtype Original Work
Refereed Yes
Status Published in final form
Language
  • English
Journal Title Journal of Financial Services Research
Publisher Springer
Geographical Reach international
ISSN 0920-8550
Volume 51
Number 2
Page Range 221 - 256
Date 2017
Abstract Text Are Islamic banks inherently more stable than conventional banks? We address this question by applying a survival analysis based on the Cox proportional hazard model to a comprehensive sample of 421 banks in 20 Middle and Far Eastern countries from 1995 to 2010. By comparing the failure risk for both bank types, we find that Islamic banks have a significantly lower risk of failure than that of their conventional peers. This lower risk is based both unconditionally and conditionally on bank-specific (microeconomic) variables as well as macroeconomic and market structure variables. Our findings indicate that the design and implementation of early warning systems for bank failure should recognize the distinct risk profiles of the two bank types.
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Digital Object Identifier 10.1007/s10693-016-0239-0
Other Identification Number merlin-id:12891
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