Performance Of Islamic Banks Research Articles

Profit-Sharing Practices To Increase Profits And Development of Indonesian Sharia Banking

Objective: The purpose to be achieved in this writing is to achieve what are the factors of grants in Islamic banks regulated by law and also to study how the performance of Islamic banks in the profit-sharing system is carried out according to the views of existing Islamic law. The performance in question is not only financial performance that will be measured and researched but also a performance by measuring profit or profit and will analyze profit but also measured sharia maqasid so that the bank has management performance by the operational conditions of Islamic banks that will use Islamic law.
 
 Method: This research uses quantitative methods by analyzing the financial statements of Islamic banks from 2012 to 2023. This data is taken from the annual financial report and calculated using the Islamic maqashid model index with quadrant analysis measurement. In this case, we can know the performance of Islamic banks in terms of finance.
 
 Result: The results of this study show that the best bank performance is BRI Syariah Bank. In contrast, the bank that has the best performance according to Sharia Maqasid is BNI Syariah Bank. In contrast, banks that have good performance are Jateng Sharia Bank, Mandiri Syariah Bank, Panin Bank Syariah, and BCA Syariah.
 
 Conclusion: It can be concluded that this study shows that the best bank performance is BRI Sharia Bank while the bank that has the best performance according to sharia maqasid is BNI Sharia Bank while banks that have good performance are Bank Jateng Syariah, Bank Syariah Indonesia, Bank Panin, Bank BCA Syariah, and so on. Thus this research is carried out hopefully can provide new enlightenment for all, including the next researcher, and banking actors in Indonesia.

The Effect of Implementing Good Corporate Governance (GCG) on the Financial Performance of Islamic Banks in Indonesia

The implementation of Good Corporate Governance (GCG) in Indonesia's Islamic banking sector is an important step to ensure transparency, accountability and fairness in the operations of financial institutions. As an integral part of the financial system, Islamic Banks not only provide services in accordance with Islamic economic principles but are also expected to implement good corporate practices to maintain the sustainability and reliability of the financial system.Corporate governance in the banking sector gained attention after the 1997 financial crisis, with the establishment of the National Committee on Governance Policy (KNKG) in 1999. Analysis of previous research results shows variations in the effect of GCG implementation on the financial performance of Islamic banks. Some studies found a significant positive impact, while others showed negative or insignificant results. Variations in results are also seen in performance indicators such as CAR, NPF, ROA, and ROE, reflecting the complexity of the relationship between GCG and aspects of financial performance. Therefore, deeper contextual understanding and improved effectiveness of GCG implementation are needed to understand and maximize its impact amidst increasingly complex financial market dynamics.

Analysis Of Islamic Banking Financial Performance Before And After The Merger

This research aims to analyze the financial performance of Islamic banking, namely BNI Syariah, BRI Syariah, and Bank Syariah Mandiri, both before and after the merger process that resulted in the formation of the new Bank Syariah Indonesia. The time period to be examined in this study encompasses the years between 2019 and 2023, with the goal of obtaining a comprehensive and detailed overview of changes in financial performance over time. The researcher will employ a quantitative approach involving the collection and analysis of numerical data. The variables to be used in this study will include financial ratios that have a close relationship with the profitability and risks experienced by Islamic banks. The research findings indicate differences in the financial performance of Islamic banking before and after the merger.

Analysis of The Financial Performance of Islamic Commercial Banks Using The Sharia Conformity Method and Profitability Method

It takes a measuring tool that has been adjusted to the concept and practice of Islamic banking a measurement tool that has been adapted to the concept and practice of Islamic banking, namely by assessing the sharia complience side of Islamic banking without ignoring the profitability side. So that the Sharia Conformity and Profitability (SCnP) Model needed. The purpose of this study is to analyze the financial performance of commercial banks using SCnP in 2017-2021. The method used is descriptive quantitative with the data source of the Annual Report of Islamic Commercial Banks downloaded from the official website of each bank. The population in this study were all BUS financial reports registered in OJK. The sampling technique used is purposive sampling with criteria that Islamic commercial banks has the highest level of profitability in 2021 (6 most). The result of this study indicate that measuring the financial performance of Islamic commercial banks using the Sharia Conformity and Profitability (SCnP) method at Islamic commercial banks in Indonesia from 2017 to 2021 shows different result. 2017, 2020, and 2021 are spread across for quadrants. While in 2018 to 2019 it was spread in three quadrants, namlely Upper Left Quadrant (ULQ), Lower Right Quadrant (LRQ), and Lower Left Quadrant (LLQ).

The effect of financial risks on the performance of Islamic and commercial banks in UAE

Risk management has emerged as a critical element across several economic sectors, with particular significance in the banking industry. The governing bodies of these industries encounter a multitude of threats stemming from the escalation of an unpredictable economic environment, the intricacy of transactions and big data, and several other concealed factors. The primary aim of the present research is to investigate the impact of certain financial risks, including capital risk, liquidity risk, and operational risk, on the financial performance of both commercial and Islamic banks operating within the banking sector of the United Arab Emirates. The study will focus on the time frame spanning from 2015 to 2022. The data used in this study was sourced from the annual reports of banks, which were acquired from the official websites of the Abu Dhabi Securities Exchange and the Dubai stock market. The most prevalent indicators used to assess a bank's financial performance are Return on Assets (ROA) and Return on Equity (ROE). In contrast, the financial risk metrics included three distinct categories of risk: capital risk, liquidity risk, and operational risk. The findings indicate that there is a statistically significant positive relationship between capital risk and both return on assets (ROA) and return on equity (ROE). However, it was observed that neither liquidity risk nor operational risk had a statistically significant impact on either of the financial performance metrics. Moreover, the size of a bank has a notable and favorable impact on both return on assets (ROA) and return on equity (ROE). The ramifications of the study's conclusions have significant importance for regulators, bank management, and investors. IPolicymakers need to prioritize the enhancement of the regulatory framework pertaining to caboutements in order to the financial stability of banks. Bank managers should give priority to the management of capital risk and the size of the bank in order to their financial performance. In order to optimize profits, it is important for investors to carefully evaluate and take into account the many risk considerations associated with their investment selections.JEL:G20, G21

The critical success factors (CSF) of blockchain technology effecting excel performance of banking sector: Case of UAE Islamic Banks

The present study aims to examine the implementation of Blockchain Technology within the financial sector, with a specific emphasis on its acceptance by Islamic banks operating in the United Arab Emirates (UAE). In the context of a technologically advanced period that necessitates expeditious and safe transactions, blockchain emerges as a viable remedy by obviating the need for intermediary entities and augmenting the velocity and security of transactions. This study uses Partial Least Squares Structural Equation Modeling (PLS-SEM) to investigate the important success aspects of technology and its influence on the performance of Islamic banks. The findings of this study are of particular importance, as they demonstrate the considerable impact of Investment Willingness on Financial Resources. Additionally, the study highlights the crucial role played by Organizational Culture and Leadership Support in fostering readiness for adoption. This study serves as an initial step towards the wider use of blockchain technology in the financial industry, with a particular focus on its application within Islamic banking institutions.

The influence of some fintech service on the performance of Islamic bank in Jordan

Islamic banking across the developing countries may undoubtedly become more prevalent thanks to financial technology, making it more competitive in the financial sector. The current study's goal is to extensively address fintech on Islamic banks and to examine the effect of fintech Services upon Islamic banking financial performance around Jordan. The investigation utilized a quantitative-descriptive survey approach. The study utilized annual data (panel data) which were acquired via financial institutions figures of the annual statements from the Jordan's Islamic Bank (JIB) registered with Amman Stock Exchange from 2017 to 2021. This investigation found Fintech services, such as internet banking, mobile banking, crowdfunding, and automated teller machines had a substantial effect on JIB's financial performance. The positive beta value suggests that there were favorable relationships among JIB's financial success from 2017 to 2021 on Fintech services. Finally, the study recommends that JIB increase its efforts to inform the public concerning Islamic banking services.

Restructuring Strategy: A Performance Review of Spin-off Islamic Banks in Indonesia

The deadline of 2023 has almost passed for the obligation to conduct a spin-off for sharia business units in Indonesia to become a fully-fledged Islamic bank. However, a number of empirical findings highlight the urgency of evaluating this policy. Furthermore, many sharia business units are unable to meet the minimal standards. The paper aims to review prior studies on how spin-off decisions affect the financial performance of spin-off Islamic banks in Indonesia. Information was gathered from the Google Scholar and Mendeley databases using a literature review methodology. This study reveals that 18 publications have tracked 10 Islamic spin-off banks and 18 financial performance indicators. Following the spin-off, six Islamic banks, including BNI Syariah, BRI Syariah, BJB Syariah, Bank KB Bukopin Syariah, BTPN Syariah, Bank Aceh Syariah, BCA Syariah, Bank Syariah Mandiri, and Panin Dubai Syariah Bank, experienced an improvement in their financial performance. Assets, third party funds, financing, market share, CAR, NPF, ROA, z-score, and Maqasid Sharia Index were the main performance indicators that experienced a significant improvement after the spin-off.

Digital transformation: An empirical analysis of operational efficiency, customer experience, and competitive advantage in Jordanian Islamic banks

This research aims to investigate the impact of digital transformation on the operational efficiency, customer experience, competitive advantage, organizational performance, and risk management in Jordanian Islamic banks. A descriptive analytical method was used, collecting primary data from a survey of 68 employees across four Islamic banks. Statistical tools, including linear regression and correlation, were used for data analysis and hypothesis testing. The findings revealed that digital transformation significantly influences the operational efficiency, competitive advantage, customer experience, organizational performance, and risk management of Islamic banks at a significance level of α ≤ 0.05. While digital transformation generally enhanced operational outcomes and customer experience, it also increased exposure to risks such as electronic attacks, fraud, and privacy concerns. The results highlight the importance of integrating digital transformation in Islamic banking while employing robust risk management strategies. These findings provide insights for policymakers, bank managers, and researchers in formulating strategic initiatives for digital transformation in the banking sector. The research contributes to the literature by focusing on the role of digital transformation in Islamic banking, a less-explored area in academic studies. This research also presents valuable implications for practice, specifically for banks and regulators to balance the potential of digital transformation with the associated risks.

Examining the moderating effect of bank size on the financial risk and performance linkage of Islamic commercial banks

Financial performance is very important for Islamic banks to ensure the sustainability of their business in providing banking products and services according to Sharia principles or Islamic law. This research examines the impact of financial risk on the financial performance of Indonesian Islamic commercial banks (ICBs), with bank size as a moderating variable. The research was conducted on all Indonesian ICBs from 2017–2021. Fixed effects models are employed to account for potential heterogeneity across banks and control for time-invariant unobserved factors. These models allow for estimating the within-bank variation over time, capturing constant bank-specific characteristics over the study period. The results of this research state that financing and operational risks significantly negatively impact financial performance. In contrast, liquidity risk does not significantly negatively impact financial performance. Furthermore, from testing the moderation hypothesis, the results of this study state that total financing reduces the significant negative effect of financing risk and operational risk on ICB Indonesia’s financial performance. However, total financing does not reduce the significant negative effect of liquidity risk on the financial performance of Indonesian ICBs.

The dynamic role of the Internet of Things (IoT) on the excel performance of Islamic banks in United Arab Emirates

The rapid advancement of technology has substantially impacted numerous sectors, including the banking industry. It is now apparent that the banking industry is affected by the innovative role that the Internet of Things (IoT) plays, which affects a multitude of operations and services. This study uses a quantitative approach and PLS-SEM to investigate the widespread impact of Internet of Things (IoT) technology on the Excel Performance of Islamic Banks in the UAE. The study integrates the Resource-Based View (RBV), Islamic Banking Theories, and Fraud Triangle Theory to create a complete framework. The research's reliability is supported by a sample of 407 replies from 504 participants. The findings strongly support the hypotheses that IoT integration improves Islamic banking performance in the UAE, such as data analytics, customer service, automation systems, fraud detection capabilities, and asset-backed finance, while aligning with Sharia Principles and improving risk-sharing mechanisms. However, the influence of IoT on escalating fraudulent activities and hence negatively impacting performance was not proven. The study emphasizes the importance of IoT in improving operational efficiency and customer satisfaction in Islamic banks in the UAE.

Gauging the impact of Covid 19 on the Islamic banking System: A comparison of the financial performance of Islamic Banks in Bahrain during pre and post-Covid-19 Era

Gauging the impact of Covid 19 on the Islamic banking System: A comparison of the financial performance of Islamic Banks in Bahrain during pre and post-Covid-19 Era

Conceptual Model of Determining Factors of Islamic Banking Financial Performance

This study aims to identify the determinants of the financial performance of Islamic banking and develop a conceptual model. This type of research uses a qualitative method with a literature study approach. Data collection uses the publish or perish application selected with the preferred reporting items for the systematic reviews and meta-analyses (PRISMA) approach. This study has identified 46 journals that meet the inclusion and exclusion criteria. Based on the analysis of 46 journals found, 40 determinants of the financial performance of Islamic banking. The financial performance elements of Islamic banking have been compiled in the form of a conceptual model categorized into two dimensions: financial factors and non-financial factors. Furthermore, nine theories are found in 46 journals: agency theory, commercial loan theory, legitimacy theory, exchange theory, company theory, resource-based theory, resource dependency theory, signal theory, and stakeholder theory.

Navigating Economic Landscapes: Strategic Insights Amidst the Pandemic and Beyond

The issue summarizes a series of research studies related to Islamic economics and finance. The first study focuses on the impact of the COVID-19 pandemic on economic growth in Muslim and non-Muslim countries, highlighting the differing effects of mobility restrictions and other pandemic-related factors. Other studies examine topics such as factors influencing foreign direct investment in Muslim countries, zakat compliance among Indonesian business owners, the integration of Bitcoin within the Indonesian monetary system, and the impact of fintech on charitable giving practices among millennials in Java. Additionally, research on Islamic banking performance, management accounting information system quality in Islamic banks, and strategic recommendations for the economic sustainability of business units within Dayah in Aceh are discussed. This issue also covers studies on halal service performance, challenges faced by halal-certified MSMEs, impulsive buying behaviors among Generation Z in Aceh, a Falah-based welfare index, cultural values as an anti-fraud strategy in Islamic schools, and the optimization of Hajj finance in Indonesia through the role of Wakalah contracts. The studies employ rigorous methodologies to achieve their objectives and their findings offer valuable insights with significant implications for the field of Islamic economics and finance, including areas like Islamic banking performance, halal service performance, and the optimization of Hajj finance.

The Role of Monetary Authorities and Banking Regulators in Supporting Sharia Bank Liquidity

This study aims to analyze the influence of the role of monetary authorities and banking regulators on the liquidity of Islamic banks in Indonesia. This research uses a qualitative approach with panel data analysis method. The sample of this study is 27 Islamic banks operating in Indonesia during the period 2019-2022. The data used are secondary data obtained from Islamic bank financial statements, Islamic banking statistics, and publications of relevant authorities. The results of this study show that the role of monetary authorities and banking regulators has a positive and significant influence on the liquidity of Islamic banks in Indonesia. This shows that the role of monetary authorities and banking regulators is very important in influencing the performance, growth, and stability of Islamic banking in Indonesia. This research provides theoretical and practical contributions for academics, practitioners, and policy makers with an interest in the liquidity management of Islamic banks. This research also provides input and advice for monetary authorities and banking regulators in increasing their role in supporting Islamic bank liquidity in Indonesia.

PENGARUH DPK, NPF DAN ZPR TERHADAP PROFITABILITAS DENGAN FDR SEBAGAI MODERASI

Based on the phenomenon regarding the development of Return on Assets (ROA) in Islamic banking in Indonesia in recent years, which shows the occurrence of fluctuations in developments and descriptions of what factors influence the financial performance of Islamic banking based on existing theory, there is an inconsistency in this research, namely the use of the moderating variable, namely Financing to Deposit Ratio (FDR), to see the relationship between DPK, NPF, and ZPR on ROA. The results of this study show that DPK has a negative and significant effect on the profitability of Islamic commercial banks. Non-performance financing has a negative and insignificant effect on the profitability of Islamic commercial banks. ZPR has a negative and insignificant effect on the profitability of Islamic commercial banks. This is caused by the fact that most Islamic commercial banks payments of zakat are not yet perfect, namely 2.5% of their assets, which have reached the ratio. Or even not paying zakat at all. and for the variable financing deposit ratio, it is able to moderate the effect of DPK and NPF on the ROA of Islamic Commercial Banks. However, the financing deposit ratio variable is not able to moderate the effect of ZPR on the ROA of Islamic commercial banks. Which means FDR is not a moderating variable on the effect of ZPR on the ROA of Islamic commercial banks.Keywords: Profitability; ZPR; FDR

PERFORMANCE OF SHARI’A BANKING IN INDONESIA BEFORE AND DURING THE COVID 19 PANDEMIC: ISLAMICITY PERFORMANCE INDEX APPROACH

This research aims to determine the performance of Islamic banks using the Islamicity Performance Index approach before and during the Covid-19 pandemic. The method used in this research is a quantitative descriptive method. The object of this research is all sharia commercial banks in Indonesia. The data for this research comes from the financial reports of Islamic commercial banks for the period 2018 - 2021. The research results show that in the profit sharing ratio before and during the pandemic, only Bank Muamalat Indonesia received a fairly good title with a percentage below 30%. The results of the zakat performance ratio show that all banks still have a bad reputation in pandemic conditions and during the pandemic. For equitable distribution ratio, only Bank Jabar Banten Syariah received a fairly good title from qard and donations, and from the labor load of Bank Muamalat, Aceh Syariah and Bukopin Syariah which was able to survive with IPI standards, while in terms of net profit only Bank Mega Syariah was able to survived the pandemic with a percentage of more than 35%. For Islamic investment vs non-Islamic investment, the entire sample of Islamic commercial banks received a very good rating. And for Islamic income vs non-Islamic income, all banks in the sample received a very good title

Islamic Banking Performance Based on Profitability Approach of Indonesia Malaysia Islamic Banks

Islamic Banking Performance Based on Profitability Approach of Indonesia Malaysia Islamic Banks

Pengaruh Corporate Governance Terhadap Profitabilitas Bank Umum Syariah Indonesia Periode 2018-2021

Corporate governance is a important key to improve the performance of Islamic commercial banks. This research aims to determine the influence of corporate governance as measured by the board of director, shariah supervisor board, board of commissioner on the profitability in Indonesia Shariah Commercial Bank from 2018-2021. Uses a panel data approach with multiple linier regression analysis where the sample is collected from 7 Indonesia Shariah Commercial Banks with 112 of total data in quarterly. The result of this study found that Shariah Supervisor Board has a negative significate effect and Commissioner Board has a positive significant effect on profitability. Meanwhile board of director has no significant effect on profitability shariah commercial banks. Furthermore, these findings shall be consideration for managers in making policies.

Sustainability Disclosures and Financial Performance of Islamic Banks in Indonesia

Sustainability practices and disclosures of Islamic banking in Indonesia are still very low. Currently, the disclosure of sustainability reports has been required by the Financial Services Authority (OJK). This paper measures the level of sustainability disclosures (economic, social, and environmental) based on OJK Regulation No. 51/2017 and investigates its impact on the financial performance of Islamic banks in Indonesia. The study was conducted in Islamic banks during 2018-2020 with a total sample of 12 banks obtained through purposive sampling. The results show that there is no significant effect of the sustainability disclosure dimensions on ROA. On the other hand, there is a significant effect of the sustainability disclosure dimensions on ROE and EPS. These results encourage Islamic banks to consistently issue a sustainability report. In the long term, the sustainability disclosure is expected to have a positive impact on the growth of Islamic banks in Indonesia.