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Bank Ownership, Characteristics, and Performance:A Comparative Analysis of Domestic and Foreign Islamic Banks in Malaysia ملكية المصرف، الخصائص والأداء:تحليل مقارن لمصارف إسلامية محلية وأجنبية بماليزيا

Author

Listed:
  • Fadzlan Sufian

    (CIMB Bank Berhad, Department of Banking and Finance, Faculty of Business and Accountancy, University of Malaya)

  • Muhd-Zulkhibri Abdul Majid

    (Senior Economist Central Bank of Malaysia Monetary and Financial Policy Department, Bank Negara Kuala Lumpur, Malaysia)

Abstract

The paper investigates the performance of Malaysian Islamic banking sector during the period 2001-2005. Several efficiency estimates of individual banks are evaluated using non-parametric Data Envelopment Analysis (DEA). Two different approaches have been employed to differentiate how efficiency scores vary with changes in inputs and outputs. The analysis links the variation in calculated efficiencies to a set of variables, i.e. bank size, ownership, capital, non-performing loans and management quality. The findings suggest that during the period of study, scale inefficiency dominates pure technical inefficiency in the Malaysian Islamic banking sector. We found that foreign banks have exhibited higher technical efficiency compared to their domestic counterparts. The second stage empirical results based on multivariate Tobit model also suggest that technically more efficient banks are larger, have greater loans intensity, and on average have less non-performing loans. تفحص هذه الورقة أداء القطاع المصرفي الإسلامي الماليزي خلال الفترة 2001 – 2005م. وسيتم تقييم العديد من مؤشرات كفاءة الأداء الفردي للمصارف باستخدام المعطيات غير النمطية وفق (Envelopment Analysis). لقد استخدمت الورقة طريقتين مختلفتين للوقوف على الاختلافات بين نتائج الكفاءة بتغير المدخلات (Inputs)، والمخرجات (Outputs). إن التحليل يربط التغيرات في مؤشرات الكفاءة بعدد من المتغيرات، مثل حجم البنك، والملكية، ورأس المال، والقروض غير العاملة، وجودة الإدارة. إن النتائج المحصل عليها خلال فترة الدراسة تشير إلى عدم الكفاءة المرتبط بالحجم والمهيمن على عدم كفاءة التقنية المحضة في قطاع الصيرفة الإسلامي الماليزي، فالبنوك الأجنبية تفوقت على نظيرتها المحلية (أي الماليزية) فيما يتعلق بكفاءة التقنية. وفيما يتعلق بالمرحلة الثانية من الدراسة أظهرت النتائج التجريبية أو القياسية باستخدام نموذج (Tobit) المتعدد المتغيرات، بأنه من الناحية التقنية أن البنوك الأكثر كفاءة هي التي تتميز بخصائص معينة، بأنها كبيرة من حيث الحجم، وأن استخدامها للقروض كبير ومكثف، وأنها في المعدل تمتلك نسبة غير كبيرة من القروض غير العاملة.

Suggested Citation

  • Fadzlan Sufian & Muhd-Zulkhibri Abdul Majid, 2008. "Bank Ownership, Characteristics, and Performance:A Comparative Analysis of Domestic and Foreign Islamic Banks in Malaysia ملكية المصرف، الخصائص والأداء:تحليل مقارن لمصارف إسلامية محلية وأجنبية بماليزي," Journal of King Abdulaziz University: Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 21(2), pages 3-36, July.
    • Handle: RePEc:abd:kauiea:v:21:y:2008:i:2:no:1:p:3-36
    DOI: 10.4197/islec.21-2.1
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