A Comparison of Leverage and Profitability of Islamic and Conventional Banks

21 Pages Posted: 12 May 2011 Last revised: 29 Apr 2016

See all articles by Kaouther Toumi

Kaouther Toumi

University of Toulouse 3 - Laboratoire gouvernance et contrôle organisationnel

Jean‐Laurent Viviani

Université de Rennes 1

Lotfi Belkacem

University of Sousse

Date Written: May 1, 2011

Abstract

The aim of this research is to determine empirically differences between Islamic and conventional banks with particular focus on their financial characteristics such as leverage and profitability. Our sample is made of Islamic and conventional banks, resulting in a panel of 545 observations with 250 of these observations being for Islamic banks, from 18 countries over the period 2004-2008. We run t-test of equality of means, a binary logistic regression and a discriminant analysis using leverage and profitability ratios and their determinants. Results provide broad evidence on differences in leverage and profitability across conventional and conventional banks.

Keywords: Islamic banks, profitability, leverage

Suggested Citation

Toumi, Kaouther and Viviani, Jean-Laurent and Belkacem, Lotfi, A Comparison of Leverage and Profitability of Islamic and Conventional Banks (May 1, 2011). in 6th International Finance Conference on Financial Crisis and Governance. Cambridge Scholars Publishing (Ed.). . Available at SSRN: https://ssrn.com/abstract=1836871 or http://dx.doi.org/10.2139/ssrn.1836871

Kaouther Toumi (Contact Author)

University of Toulouse 3 - Laboratoire gouvernance et contrôle organisationnel ( email )

118 Route de Narbonne
Toulouse cedex 9, F-31062
France

Jean-Laurent Viviani

Université de Rennes 1 ( email )

11 Rue Jean Macé
Rennes, Rennes 35700
France

Lotfi Belkacem

University of Sousse ( email )

rue Abdelaziz el Behi
Sousse, Sousse 4000
Tunisia

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