Article Sidebar

Download
PDF Structured Abstract
Statistic
Read Counter : 1591 Download : 1207

Downloads

Download data is not yet available.

Main Article Content

Abstract

Purpose – This study explores comparatively the effects of capital adequacy, non-performing loans/financing, liquidity, and operating expenses on Indonesia’s conventional and Islamic banking performances between the pre-and post-2008 Global Financial Crisis (GFC) periods.

Methodology – The study selected the three respective largest conventional and Islamic banks as a sample of the study using a purposive sampling technique. The data for the pre-2008 GFC period (i.e., 2003 – 2008) and the post-2008 GFC period (i.e., 2009 – 2017) were analyzed using a panel multiple regression analysis.

Findings – The study documented different influences of capital adequacy, liquidity, non-performing loans/financing, and operating expenses on conventional and Islamic banking performances between the pre- and post-2008 GFC. 

Research limitations – This study only investigated the banks’ characteristics as the determinants of banking performances and compared merely the effects the pre- and post-2008 GFC periods.

Practical implications – To maintain and enhance their performances, the Islamic and conventional banks should adopt different financial policies between the normal and turbulent economic periods. The Islamic banks were in a better position amid the crisis, showing an urgent need for the government to further promote Islamic banks, as they could offer better solutions for economic stability.

Originality – The study examined a larger number of conventional and Islamic banks over more extended and updated study periods, namely six years (i.e., 2003-2008) before the 2008 GFC and ten years (i.e., 2009-2018) after the 2018 GFC. The study is among the first attempts to comparatively analyze the determinants of Indonesia’s Islamic and conventional banking performances between the pre- and post-2008 GFC periods using the panel multiple regression analysis to arrive at more comprehensive and robust empirical evidence.

Article Details

License

Copyright (c) 2020 Authors

Creative Commons License

This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

Authors who publish with this journal agree to the following terms:

  1. Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgment of the work's authorship and initial publication in this journal.
  2. Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgment of its initial publication in this journal.
  3. Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See The Effect of Open Access).
Author Biographies

M. Shabri Abd. Majid, Department of Islamic Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh, Indonesia

Dr. M. Shabri Abd. Majid, M.Ec is a senior lecturer at the Faculty of Economics, Syiah Kuala University. He received his Sarjana Ekonomi (SE) from Syiah Kuala University, Indonesia, in 1995. He completed his Master of Economics (MEc) and PhD in Financial Economics from the International Islamic University Malaysia (IIUM) in 1998 and 2005, respectively. He has served Kulliyyah of Economics and Management Sciences (KENMS) IIUM as the Associate Professor for six years (2005-2011). He has been appointed as the Head of the Islamic Economics Department, Faculty of Economics, Syiah Kuala University, Indonesia from 2014 to 2017. He also has served the Institute for Research and Community Services, Syiah Kuala University from 2016 to 2018. His research interests include financial economics, applied econometrics, Islamic economics, banking and finance. He has published 49 referred articles indexed in the Scopus database, such as International Journal of Emerging Markets, Global Economic Review, Journal of Asia-Pacific Business, Studies in Economics and Finance, International Journal of Managerial Finance, Journal of Economic Cooperation and Development, Review of Islamic Economics, and JKAU: Islamic Economics. He has also presented his papers in various seminars locally and internationally. He is the Editor-in-Chief, Aceh International Journal of Social Sciences. He has serving several international journals as the editorial boards such as Gadjahmada International Journal of Business, etc.

Sri Ulina, Department of Islamic Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh, Indonesia

A graduate student in Islamic Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh, Indonesia.
How to Cite
Majid, M. S. A., & Ulina, S. (2020). Does the 2008-global financial crisis matter for the determinants of conventional and Islamic banking performances in Indonesia?. Jurnal Ekonomi & Keuangan Islam, 6(2), 77–90. https://doi.org/10.20885/jeki.vol6.iss2.art1
Download Citation
Endnote/Zotero/Mendeley (RIS)
BibTeX
Crossref
Scopus
Google Scholar
Europe PMC

References

  1. Ardiyana, M. (2011). Analisis perbandingan kinerja keuangan bank syari’ah dan bank konvensional sebelum, selama, dan sesudah krisis global tahun 2008 dengan menggunakan metode CAMEL (Studi kasus pada PT Bank Syari’ah Mandiri dan PT Bank Mandiri Tbk). Thesis. Diponegoro University. Retrieved from http://eprints.undip.ac.id/29852/
  2. Arfan, M., Basri, H., Handayani, R., Shabri, M.S.A., Fahlevi, H., & Dianah, A. (2017). Determinants of cash holding of listed manufacturing companies in the Indonesian stock exchange. DLSU Business and Economics Review, 26(2), 1–12. Retrieved from https://www.dlsu.edu.ph/wp-content/uploads/2019/03/1arfan-012517.pdf
  3. Aryati, T., & Balafif, S. (2007). Analisis faktor yang mempengaruhi tingkat kesehatan bank dengan regresi logit. The Winners, 8(2), 111–125. https://doi.org/10.21512/tw.v8i2.734
  4. Banik, B.P., & Das, P.C. (2013). Comparison of financial performance of state owned commercial banks: A case study of Bangladesh. International Journal of Science and Research, 2(2), 423–428. Retrieved from https://www.ijsr.net/search_index_results_paperid.php?id=IJSRON2013449,
  5. Bank Indonesia. (2009). Outlook Ekonomi Indonesia 2009 - 2014, Edisi Januari 2009. Jakarta. Retrieved from https://www.bi.go.id/id/ruang-media/info-terbaru/Pages/news_oei_0109.aspx
  6. Bank Indonesia. (2010). Krisis Global dan Penyelamatan atas Sistem Perbankan Indonesia. Jakarta. Retrieved from https://www.bi.go.id/id/publikasi/lain/artikel/Pages/buku_krisis_global_180110.aspx
  7. Betharino, L. (2015). Analisis perbandingan kinerja keuangan bank konvensional dan bank syariah pada PT. Bank Negara Indonesia Tbk. Artikel Ilmiah Mahasiswa. Universitas Padjajaran. Retrieved from https://repository.unej.ac.id/bitstream/handle/123456789/64460/LENGGA%20BETHARINO.pdf?sequence=1
  8. Chamberlain, T., Hidayat, S., & Khokhar, A.R. (2020). Credit risk in Islamic banking: Evidence from the GCC. Journal of Islamic Accounting and Business Research, 11(5), 1055–1081. https://doi.org/10.1108/JIABR-09-2017-0133
  9. Chowdhury, M.A.F., Haque, M.M., & Masih, M. (2017). Re-examining the determinants of Islamic bank performance: New evidence from dynamic GMM, quantile regression, and wavelet coherence approaches. Emerging Markets Finance and Trade, 53(7), 1519–1534. https://doi.org/10.1080/1540496X.2016.1250076.
  10. Davies, G. (2002). A History of Money: From Ancient Times to the Present Day. The UK: University of Wales Press. Retrieved from http://library.uniteddiversity.coop/Money_and_Economics/A_History_of_Money-From_Ancient_Times_to_the_Present_Day.pdf
  11. Dewi, D. (2010). Faktor-faktor yang mempengaruhi profitabilitas bank syariah di Indonesia. Thesis. Diponegoro University. Retrieved from http://eprints.undip.ac.id/26645/1/ARTIKEL_JURNAL-SKRIPSI.pdf
  12. Erol, C.F., Baklaci, H., Aydogan, B., & Tunc, G. (2014). Performance comparison of Islamic (participation) banks and commercial banks in Turkish banking sector. EuroMed Journal of Business, 9(2), 114–128. https://doi.org/10.1108/EMJB-05-2013-0024
  13. Hamid, A., Majid, M.S.A., & Khairunnisah, L. (2017). An empirical re-examination of the Islamic banking performance in Indonesia. International Journal of Academic Research in Economics and Management Sciences, 6(2), 219–232. https//doi.org/10.6007/IJAREMS/v6-i2/3022
  14. Hassan Al-Tamimi, H.A. (2010). Factors influencing performance of the UAE Islamic and conventional national banks. Global Journal of Business Research, 4(2), 1–9. Retrieved from https://www.researchgate.net/publication/228201551_Factors_Influencing_Performance_of_the_UAE_Islamic_and_Conventional_National_Banks
  15. Hassan Al-Tamimi, H.A., Miniaoui, H., & Elkelish, W.W. (2015). Financial risk and Islamic banks’ performance in the Gulf Cooperation Council Countries. The International Journal of Business and Finance Research, 9(5), 103–112. Retrieved from http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n5-2015/IJBFR-V9N5-2015-9.pdf.
  16. Hazzi, O.A., & Kilani, M.I.A. (2013). The financial performance analysis of Islamic and traditional banks: Evidence from Malaysia. European Journal of Economics, Finance and Administrative Sciences, 57, 133–144. Retrieved from https://www.researchgate.net/publication/258513889_The_Financial_Performance_Analysis_of_Islamic_and_Traditional_Banks_Evidence_from_Malaysia.
  17. Jaffar, M., & Manarvi, I. (2011). Performance comparison of Islamic and conventional banks in Pakistan. Global Journal of Management and Business Research, 11(1), 31–42. Retrieved from https://globaljournals.org/GJMBR_Volume11/7_Performance_comparison_of_Islamic_and_Conventional_banks_in_Pakistan.pdf.
  18. Kassim, S.H., & Majid, M.S.A. (2010). Impact of financial shocks on Islamic banks: Malaysian evidence during 1997 and 2007 financial crises. International Journal of Islamic and Middle Eastern Finance and Management, 3(4), 291–305. https://doi.org/10.1108/17538391011093243
  19. Kassim, S.H., Majid, M.S.A., & Hamid, Z. (2011). The 2007 global financial crisis and the Malaysian stock market: A sectoral analysis. Afro-Asian Journal of Finance and Accounting, 2(3), 185–209. https://doi.org/10.1504/AAJFA.2011.041629
  20. Kassim, S.H., Majid, M.S.A., & Yusof, R.M. (2009). Impact of monetary policy shocks on the conventional and Islamic banks in a dual banking system: Evidence from Malaysia. Journal of Economic Cooperation and Development, 30(1), 41–58. Retrieved from https://www.researchgate.net/publication/254369532_Impact_of_Monetary_Policy_Shocks_on_the_Conventional_and_Islamic_Banks_in_a_Dual_Banking_System_Evidence_from_Malaysia
  21. Khan, I., Khan, M., & Tahir, M. (2017). Performance comparison of Islamic and conventional banks: empirical evidence from Pakistan. International Journal of Islamic and Middle Eastern Finance and Management, 10(3), 419–433. https://doi.org/10.1108/IMEFM-05-2016-0077
  22. Kusumo, Y.A. (2008). Analisis kinerja keuangan Bank Syariah Mandiri periode 2002–2007 (Dengan pendekatan PBI No. 9/1/PBI/2007). La Riba Jurnal Ekonomi Islam, 2(1), 109–131. Retrieved from https://studylibid.com/doc/1076052/analisis-kinerja-keuangan-bank-syariah-mandiri-periode-2002
  23. Majid, M.S.A. (2018). Stability and resilience of equity markets amidst the 2008 global financial crisis: Islamic versus conventional markets. DLSU Business & Economics Review, 28(1), 34–48. Retrieved from http://dlsu-ber.com/stability-and-resilience-of-equity-markets-amidst-the-2008-global-financial-crisis-islamic-versus-conventional-markets/
  24. Majid, M.S.A., & Kassim, S.H. (2009). Impact of the 2007 US financial crisis on the emerging equity markets. International Journal of Emerging Markets, 4(4), 341–357. https://doi.org/10.1108/17468800910991241
  25. Majid, M.S.A., & Maulana, H. (2012). A comparative analysis of the productivity of Islamic and conventional mutual funds in Indonesia: Data envelopment analysis (DEA) and general least square (GLS) Approaches. Gadjah Mada International Journal of Business, 14(2), 183–208. https://doi.org/10.22146/gamaijb.5439
  26. Majid, M.S.A., Musnadi, S., & Putra, I.Y. (2014). A comparative analysis of the quality of Islamic and conventional banks’ asset management in Indonesia. Gadjah Mada International Journal of Business, 6(2), 185–200. https://doi.org/10.22146/gamaijb.5463
  27. Mokni, R.B.S., & Rachdi, H. (2014). Assessing the bank profitability in the MENA region: A comparative analysis between conventional and Islamic banks. International Journal of Islamic and Middle Eastern Finance and Management, 7(3), 305–332. https://doi.org/10.1108/IMEFM-03-2013-0031
  28. Nugraha, D.A. (2014). Analisis perbandingan kinerja keuangan bank syariah dengan bank konvensional (Studi kasus pada PT. Bank Syariah Mandiri dan PT. Bank Central Asia). Universitas Muhammadiyah Surakarta. Retrieved from http://eprints.ums.ac.id/32037/9/2_JURNAL%20publikasi_damara-rev%20ok111.pdf
  29. Ongore, V.O., & Kusa, G.B. (2013). Determinants of financial performance of commercial banks in Kenya. Issues, International Journal of Economics and Financial, 3(1), 237–252. Retrieved from http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.827.1383&rep=rep1&type=pdf
  30. Otoritas Jasa Keuangan. (2018). Sharia Banking Statistics. Jakarta. Retrieved from https://ojk.go.id/en/kanal/perbankan/data-dan-statistik/statistik-perbankan-syariah/Default.aspx
  31. Rose, P.S., & Hudgins, S.C. (2005). Bank Management and Financial Services. The UK: McGraw-Hill.
  32. Rosly, S.A., & Bakar, M.A.A. (2003). Performance of Islamic and mainstream banks in Malaysia. International Journal of Social Economics, 30(12), 1249–1265. https://doi.org/10.1108/03068290310500652
  33. Sabir, M.A., & Habbe, A.H. (2012). Pengaruh rasio kesehatan bank terhadap kinerja keuangan bank umum syariah dan bank konvensional di Indonesia. Jurnal Analisis, 1(1), 79–86.
  34. Setyaningsih, A., & Utami, S.S. (2013). Analisis perbandingan kinerja keuangan perbankan syariah dengan perbankan konvensional. Ekonomi dan Kewirausahaan, 3(1), 100–115. Retrieved from http://ejurnal.unisri.ac.id/index.php/Ekonomi/article/view/550
  35. Subaweh, I. (2008). Analisis perbandingan kinerja keuangan bank syariah dan bank konvensional periode 2003-2007. Jurnal Ilmiah Ekonomi Bisnis, 13(2), 112–125. Retrieved from https://ejournal.gunadarma.ac.id/index.php/ekbis/article/view/303
  36. Sudarsono, H. (2009). Dampak krisis keuangan global terhadap perbankan di Indonesia: Perbandingan antara bank konvensional dan bank Syariah. La Riba Jurnal Ekonomi Islam, 3(1), 12–23. Retrieved from https://journal.uii.ac.id/index.php/JEI/article/view/2551/2339
  37. Sugema, I. (2012). Krisis keuangan global 2008-2009 dan implikasinya pada perekonomian Indonesia. Jurnal Ilmu Pertanian Indonesia (JIPI), 17(3), 145–152. Retrieved from https://journal.ipb.ac.id/index.php/JIPI/article/view/8333
  38. Sukarno, K.W., & Syaichu, M. (2006). Analisis faktor-faktor yang mempengaruhi kinerja bank umum di Indonesia. Jurnal Studi Manajemen Organisasi, 3(2), 46–58. https://doi.org/10.14710/jsmo.v3i2.4193
  39. Tong, H., & Wei, S.H. (2008). Real effects of the subprime mortgage crisis: Is it a demand of finance shock? (No. w14205). National Bureau of Economic Research. Retrieved from https://www.cepal.org/noticias/paginas/3/35143/tongrealeffectofsubprime_w14205.pdf
  40. Wasiuzzaman, S., & Nair Gunasegavan, U. (2013). Comparative study of the performance of Islamic and conventional banks: The case of Malaysia. Humanomics, 29(1), 43–60. http://dx.doi.org/10.1108/08288661311299312
  41. Wibowo, E.S., & Syaichu, M. (2013). Analisis pengaruh suku bunga, inflasi, CAR, BOPO, NPF terhadap profitabilitas bank syariah. Diponegoro Journal of Management, 2(2), 10–19. Retrieved from https://ejournal3.undip.ac.id/index.php/djom/article/view/2651
  42. Yani, R.N., Arfan, M., & Majid, M.S.A. (2020). What determines Islamic stock returns in Indonesia?. Share: Jurnal Ekonomi dan Keuangan Islam, 9(1), 1–13. https://doi.org/10.22373/share.v9i1.6259