Title: Efficiency of Islamic banks in selected member countries of the Organisation of Islamic Conference

Authors: Miranti Kartika Dewi, Maliah Sulaiman, Ilham Reza Ferdian

Addresses: Faculty of Economics, Center for Islamic Economics and Business (PEBS), Department of Accounting, University of Indonesia, UI Campus, 16424 Depok, Jawa Barat, Indonesia. ' Department of Accounting, Kuliyyah of Economics and Management Sciences, International Islamic University Malaysia, Gombak Campus, 53100, Kuala Lumpur, Malaysia. ' Faculty of Economics, Department of Management, University of Indonesia, UI Campus, 16424 Depok, Jawa Barat, Indonesia

Abstract: This study aims to investigate the relative efficiency amongst Islamic banks in selected OIC member countries from 2002 to 2006, by observing performance of 25 Islamic banks in 14 countries. It employs DEA method by using intermediation approach. Additionally, regression is used to find the correlation between efficiency scores and some of the performance indicators. The result shows that during 2002-2006, Islamic banks in the OIC-LDCs were the most efficient ones. Lastly, efficiency level of Islamic banks in the study was significantly and positively influenced by ETAR, ROA, and LDR. In contrast, efficiency score is negatively related to OEOI.

Keywords: Islamic banks; banking efficiency; DEA; data envelopment analysis; OIC countries; performance measurement; Islamic finance.

DOI: 10.1504/IJMEF.2010.031236

International Journal of Monetary Economics and Finance, 2010 Vol.3 No.2, pp.177 - 205

Published online: 26 Jan 2010 *

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