Impact of Investment Deposits & Risk Taking On Capital Decisions in Islamic Banks of Islamic Financial Services Board Member Countries
International Journal of Economics and Empirical Research. 2016, 4(9), 510-520.
11 Pages Posted: 23 Aug 2018
Date Written: 2016
Purpose: This study analyzes the impact of investment deposits and risk taking on capital decisions in Islamic Banks of selected Islamic Financial Services Board (IFSB) countries (Pakistan, UAE, Qatar, and Malaysia). Five Islamic banks of each country were selected as a sample for the period of 2010 to 2014. Methodology: The panel data was used. Fixed/random effect was selected on the bases of Hausman test. Findings: The results of current study show the significant impact of investment deposits (Profit Sharing Investment Account) and risk on capital decision (Capital Adequacy Ratio). Recommendations: This study recommends improvement in the implementation of profit and loss sharing to curb unnecessary risk taking for making effective capital decisions in Islamic Banks.
Keywords: Investment Deposits, Capital Decision, Islamic Banks
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