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Year 2015, Volume: 2 Issue: 3, 0 - 0, 29.09.2015

Ismail Yildirim

Abstract

References

  • Ada, A. A., Dalkılıç, N. (2014). Efficiency Analysis in Islamic Banks: A Study for Malaysia and Turkey, BDDK
  • Bankacılık ve Finansal Piyasalar, Cilt: 8, Sayı: 1. Ahmad Mokhtar, H. S., Abdullah, N. & Alhabshi, S.M. (2006). Efficiency of Islamic Banking in Malaysia: A
  • Stochastic Frontier Approach, Journal of Economic Corporation, 22 (2), 37-30. Ahmad Mokhtar, H. S., Abdullah, N. & Alhabshi, S.M. (2008). Efficiency and Competition of Islamic Banking in
  • Malaysia, Humanomics, 24(1), 28-48. Ahmad, S., Abdul-Rahman, A.R., (2012). The efficiency of Islamic and conventional commercial banks in Malaysia.
  • Int. J. Islam. Middle East. Finance Manage. 5 (3), 241–263. Aldohni, A. K. (2015). The Quest for a Better Legal and Regulatory Framework for Islamic Banking, Ecclesiastical
  • Law Journal / Volume 17 / Issue 01 / pp 15 – 35. Al-Maghaireh, (2005). A. Comparative Financial Performance of Islamic Banks vis-à-vis Conventional Banks in the UAE. Working Paper. Dept. of Economics and Finance, UAE University. Al-Ain. 2005.
  • Ariff, M. (2014). Whither Islamic Banking? The World Economy, Volume 37, Issue 6, pages 733–746.
  • Bellalah, M., Ellouz S. (2004). Islamic finance, interest rates and Islamic banking: A Survey of the literature.
  • Finance India: special issue, 18, 533-546. Caves, D., Christiensen, L.R. and Diewert, W.E., (1982). The economic theory of ındeks numbers and the measurement of ınput, output and productivity, Econometrica, Vol. 50, 1393-1414.
  • Chen, Y., Agha, I.A. (2002). Continuous Optimization Output–Input Ratio Analysis and DEA Frontier, European
  • Journal of Operational Research, Volume: 142. Ernst and Young; World Islamic Banking Competitiveness Report 2013–14.
  • Estache A., Be, B. T., and Trujillo, L. (2004). Sources of efficiency gains in port reform: A DEA decomposition of a
  • Malmquist TFP indeks for Mexico, Utulities Policy, Vol. 12, 221-230. Fare, R., S. Grosskopf ve P. Roos (1997). Malmquist productivity indexes: A survey of theory and practice, Index
  • Numbers: Essays in Honour of Sten Malmquist, Ed.:R. Fare, S. Grosskopf, R.R. Russell, Kluwer Academic Publishers: Boston, 1997.
  • Fare, R., S. Grosskopf, M. Norris, Z. Zhang (1994). Productivity growth, technical progress, and efficiency changes in industrialised countries, American Economic Review, Vol.84, 1994, pp.66-83.
  • Gishkoru, M.A., Ullah, N. (2013). Technical Efficiency of Islamic and Commercial Banks: Evidence from Pakistan
  • Using DEA Model (2007-2011), Journal of Business and Management, Volume 7, Issue 4, PP 68-76.
  • Hussein, K.A. (2003). Operational Efficiency in Islamic Banking: The Sudanese Experience. Islamic Research and Training Institute (IRTI) Working Paper, No. 1, Islamic Development Bank, Saudi Arabia.
  • Kamaruddin, B.H., Safa, M.S., and Mohd, R. (2008). Assessing production efficiency of Islamic banks and conventional bank Islamic windows in Malaysia, International Journal of Business and Management Research, 1 (1) pp. 31-48.
  • Kim J.,(2000). A Comparative Study on Productive Efficiency: Japan and United States Non-Life Insurance
  • Industries, Doctorial Thesis of Philosophy, Temple University. Liu, F.F. ve Wang, P.H. (2008). DEA Malmquist Productivity Measure: Taiwanese Semiconductor Companies,
  • International Journal of Production Economics, 112: 367-379. Mallin, C., Faraga, H., Yonga, K. (2014). Corporate social responsibility and financial performance in Islamic banks, Journal of Economic Behavior & Organization 103, S21–S38.
  • Matthews, K., Mahadzir, İ. (2006). Efficiency and Productivity Growth of Domestic and Foreign Commercial Banks in Malaysia, Cardiff Economics Working Papers, Cardiff, U.K., 2006.
  • Mghaieth, A., Mehdi, I.K.E. (2014). The determinants of cost/profit efficiency of Islamic banks before, during and after the crisis of 2007-2008 using SFA approach, IPAG working papers, http://www.ipag.fr/fr/accueil/la- recherche/publications-WP.html
  • Moktar, H.S., N. Abdullah and S.M. Al-Habshi (2006). Efficiency of Islamic Banks in Malaysia: A Stochastic Frontier
  • Approach, Journal of Economic Cooperation among Islamic Countries 27 (2), 37–70. Musa, H and Obadi S.M. (2009). Islamıc Fınancıal Systems, Studia Universitatis, Vasile Goldiş, Arad Economic Sciences, Issue: 11 / 2009.
  • Norbaizura, K., Rosmanira, I. W., Mohd, M.A. (2014). Assessing Efficiency and Effectiveness of Malaysian Islamic
  • Banks: A Two Stage DEA Analysis, Proceedings Of The 3rd International Conference On Mathematical Sciences Book Series: Aip Conference Proceedings Volume: 1602 Pages: 934-938.
  • Said, J., Rachida, B.J., Azza, Z. (2011). Efficiency and effectiveness comparison of Islamic and conventional banking: case of Indonesia, Online at http://mpra.ub.uni-muenchen.de/57551/ MPRA Paper No. 57551 posted
  • Smola, E. and Mirakhor, A. (2010). The Global Financial Crisis and Its Implications for the Islamic Financial
  • Industry”, International Journal of Islamic and Middle Eastern Finance and Management, 3, (4), 372-385. Sufian, F. (2007). The Efficiency of Islamıc Banking Industry: A Non-Parametric Analysis with Non-Discretionary
  • Input Variable. Islamic Economic Studies, 14(1& 2), 53-87. Sufian, S., Farman, A., Baber, A., Muhammad, H. (2013). Examining Efficiency of Islamic and Conventional Banks in Pakistan: Using Data Envelopment Analysis, Global Journal of Management and Business Research Volume 13 Issue 10.
  • Y. Yu, Q. Shi (2014).Two-stage DEA model with additional input in the second stage and part of intermediate products as final outputs, Expert Systems with Applications, 41 (15), pp. 6570–6574.
  • Wanke, C. Barros (20149. Two-stage DEA: An application to major Brazilian banks, Expert Systems with
  • Applications, 41 (5) (2014), pp. 2337–2344.
  • Wu, Z. Yang, L. Liang (2006).Using DEA-neural network approach to evaluate branch efficiency of a large
  • Canadian bank, Expert Systems with Applications, 31 (1), pp. 108–115.

FINANCIAL EFFICIENCY ANALYSIS IN ISLAMIC BANKS: TURKEY AND MALAYSIA MODELS

Year 2015, Volume: 2 Issue: 3, 0 - 0, 29.09.2015

Ismail Yildirim

Abstract

This study uses Data Envelopment Analysis for the efficiency measurements while using the Malmquist Total Factor Productivity Index in order to measure the total factor productivity change. This study involves 4 Islamic banks operating in Turkey and 13 Islamic banks operating in Malaysia. Half of these Islamic banks operating in Turkey and Malaysia meet the technical productivity (CCR) value. In other words, half of these Islamic banks are able to use their Total Assets and Total Equities efficiently. It was found that the Technical Efficiency Change (EFFCH) value of the Islamic banks was never recorded above 1 for any time period. It was found that the Islamic Banks are unlikely to reach the production limit.

References

  • Ada, A. A., Dalkılıç, N. (2014). Efficiency Analysis in Islamic Banks: A Study for Malaysia and Turkey, BDDK
  • Bankacılık ve Finansal Piyasalar, Cilt: 8, Sayı: 1. Ahmad Mokhtar, H. S., Abdullah, N. & Alhabshi, S.M. (2006). Efficiency of Islamic Banking in Malaysia: A
  • Stochastic Frontier Approach, Journal of Economic Corporation, 22 (2), 37-30. Ahmad Mokhtar, H. S., Abdullah, N. & Alhabshi, S.M. (2008). Efficiency and Competition of Islamic Banking in
  • Malaysia, Humanomics, 24(1), 28-48. Ahmad, S., Abdul-Rahman, A.R., (2012). The efficiency of Islamic and conventional commercial banks in Malaysia.
  • Int. J. Islam. Middle East. Finance Manage. 5 (3), 241–263. Aldohni, A. K. (2015). The Quest for a Better Legal and Regulatory Framework for Islamic Banking, Ecclesiastical
  • Law Journal / Volume 17 / Issue 01 / pp 15 – 35. Al-Maghaireh, (2005). A. Comparative Financial Performance of Islamic Banks vis-à-vis Conventional Banks in the UAE. Working Paper. Dept. of Economics and Finance, UAE University. Al-Ain. 2005.
  • Ariff, M. (2014). Whither Islamic Banking? The World Economy, Volume 37, Issue 6, pages 733–746.
  • Bellalah, M., Ellouz S. (2004). Islamic finance, interest rates and Islamic banking: A Survey of the literature.
  • Finance India: special issue, 18, 533-546. Caves, D., Christiensen, L.R. and Diewert, W.E., (1982). The economic theory of ındeks numbers and the measurement of ınput, output and productivity, Econometrica, Vol. 50, 1393-1414.
  • Chen, Y., Agha, I.A. (2002). Continuous Optimization Output–Input Ratio Analysis and DEA Frontier, European
  • Journal of Operational Research, Volume: 142. Ernst and Young; World Islamic Banking Competitiveness Report 2013–14.
  • Estache A., Be, B. T., and Trujillo, L. (2004). Sources of efficiency gains in port reform: A DEA decomposition of a
  • Malmquist TFP indeks for Mexico, Utulities Policy, Vol. 12, 221-230. Fare, R., S. Grosskopf ve P. Roos (1997). Malmquist productivity indexes: A survey of theory and practice, Index
  • Numbers: Essays in Honour of Sten Malmquist, Ed.:R. Fare, S. Grosskopf, R.R. Russell, Kluwer Academic Publishers: Boston, 1997.
  • Fare, R., S. Grosskopf, M. Norris, Z. Zhang (1994). Productivity growth, technical progress, and efficiency changes in industrialised countries, American Economic Review, Vol.84, 1994, pp.66-83.
  • Gishkoru, M.A., Ullah, N. (2013). Technical Efficiency of Islamic and Commercial Banks: Evidence from Pakistan
  • Using DEA Model (2007-2011), Journal of Business and Management, Volume 7, Issue 4, PP 68-76.
  • Hussein, K.A. (2003). Operational Efficiency in Islamic Banking: The Sudanese Experience. Islamic Research and Training Institute (IRTI) Working Paper, No. 1, Islamic Development Bank, Saudi Arabia.
  • Kamaruddin, B.H., Safa, M.S., and Mohd, R. (2008). Assessing production efficiency of Islamic banks and conventional bank Islamic windows in Malaysia, International Journal of Business and Management Research, 1 (1) pp. 31-48.
  • Kim J.,(2000). A Comparative Study on Productive Efficiency: Japan and United States Non-Life Insurance
  • Industries, Doctorial Thesis of Philosophy, Temple University. Liu, F.F. ve Wang, P.H. (2008). DEA Malmquist Productivity Measure: Taiwanese Semiconductor Companies,
  • International Journal of Production Economics, 112: 367-379. Mallin, C., Faraga, H., Yonga, K. (2014). Corporate social responsibility and financial performance in Islamic banks, Journal of Economic Behavior & Organization 103, S21–S38.
  • Matthews, K., Mahadzir, İ. (2006). Efficiency and Productivity Growth of Domestic and Foreign Commercial Banks in Malaysia, Cardiff Economics Working Papers, Cardiff, U.K., 2006.
  • Mghaieth, A., Mehdi, I.K.E. (2014). The determinants of cost/profit efficiency of Islamic banks before, during and after the crisis of 2007-2008 using SFA approach, IPAG working papers, http://www.ipag.fr/fr/accueil/la- recherche/publications-WP.html
  • Moktar, H.S., N. Abdullah and S.M. Al-Habshi (2006). Efficiency of Islamic Banks in Malaysia: A Stochastic Frontier
  • Approach, Journal of Economic Cooperation among Islamic Countries 27 (2), 37–70. Musa, H and Obadi S.M. (2009). Islamıc Fınancıal Systems, Studia Universitatis, Vasile Goldiş, Arad Economic Sciences, Issue: 11 / 2009.
  • Norbaizura, K., Rosmanira, I. W., Mohd, M.A. (2014). Assessing Efficiency and Effectiveness of Malaysian Islamic
  • Banks: A Two Stage DEA Analysis, Proceedings Of The 3rd International Conference On Mathematical Sciences Book Series: Aip Conference Proceedings Volume: 1602 Pages: 934-938.
  • Said, J., Rachida, B.J., Azza, Z. (2011). Efficiency and effectiveness comparison of Islamic and conventional banking: case of Indonesia, Online at http://mpra.ub.uni-muenchen.de/57551/ MPRA Paper No. 57551 posted
  • Smola, E. and Mirakhor, A. (2010). The Global Financial Crisis and Its Implications for the Islamic Financial
  • Industry”, International Journal of Islamic and Middle Eastern Finance and Management, 3, (4), 372-385. Sufian, F. (2007). The Efficiency of Islamıc Banking Industry: A Non-Parametric Analysis with Non-Discretionary
  • Input Variable. Islamic Economic Studies, 14(1& 2), 53-87. Sufian, S., Farman, A., Baber, A., Muhammad, H. (2013). Examining Efficiency of Islamic and Conventional Banks in Pakistan: Using Data Envelopment Analysis, Global Journal of Management and Business Research Volume 13 Issue 10.
  • Y. Yu, Q. Shi (2014).Two-stage DEA model with additional input in the second stage and part of intermediate products as final outputs, Expert Systems with Applications, 41 (15), pp. 6570–6574.
  • Wanke, C. Barros (20149. Two-stage DEA: An application to major Brazilian banks, Expert Systems with
  • Applications, 41 (5) (2014), pp. 2337–2344.
  • Wu, Z. Yang, L. Liang (2006).Using DEA-neural network approach to evaluate branch efficiency of a large
  • Canadian bank, Expert Systems with Applications, 31 (1), pp. 108–115.
There are 37 citations in total.

Details

Journal Section Articles
Authors

Ismail Yildirim

Publication Date September 29, 2015
Published in Issue Year 2015 Volume: 2 Issue: 3

Cite

APA Yildirim, I. (2015). FINANCIAL EFFICIENCY ANALYSIS IN ISLAMIC BANKS: TURKEY AND MALAYSIA MODELS. Journal of Economics Finance and Accounting, 2(3). https://doi.org/10.17261/Pressacademia.2015312956

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