Financing growth and impaired financing: a study on Malaysian Islamic banks

Islamic banking in Malaysia has recorded tremendous development and growth in the last two decades. However, the level of financing growth of Islamic banks has experienced a declination in the recent years due to several factors. The main purpose of this research is to examine the relationship betwe...

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Main Author:	Nabilah Wafa', Mohd Najib
Format:	Thesis
Language:	eng eng
Published:	2018
Subjects:	HG Finance
Online Access:	https://etd.uum.edu.my/8202/1/s822652_01.pdf https://etd.uum.edu.my/8202/2/s822652_02.pdf
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id	my-uum-etd.8202
record_format	uketd_dc
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng
advisor	Abd Wahab, Norazlina
topic	HG Finance
spellingShingle	HG Finance Nabilah Wafa', Mohd Najib Financing growth and impaired financing: a study on Malaysian Islamic banks
description	Islamic banking in Malaysia has recorded tremendous development and growth in the last two decades. However, the level of financing growth of Islamic banks has experienced a declination in the recent years due to several factors. The main purpose of this research is to examine the relationship between financing growth and impaired financing particularly. At the same time, it attempts to investigate other determinants of financing growth such as capital (CAP), bank size (SIZE), gross domestic product (GDP), inflation (INF) and overnight policy rate (OPR). This is due to the importance of financing growth towards Islamic banks and lack of empirical research to distinctly establish the determinants of financing growth, especially in Malaysian Islamic banks. The secondary data was used from 16 Islamic banks in Malaysia over the 2012 – 2016 period (80 observations). This study employs Descriptive Statistics, Correlation Analysis, Diagnostic Tests, Panel Data Test and Multiple Regression Analysis as data analysis. The study reveals that external and internal factors, namely GDP, INF, IF and CAP are significantly influencing the financing growth of Malaysian Islamic banks. On the other hand, SIZE and OPR have no significant impact on the financing growth. The results provide statistical evidence that an increase in impaired financing reduces Islamic banks’ financing growth. Hence, the researcher suggests several recommendations to bankers and body regulations in order to minimize the level of impaired financing and thus, enabling the expansion of financing growth level in Malaysian Islamic banks.
format	Thesis
qualification_name	other
qualification_level	Master's degree
author	Nabilah Wafa', Mohd Najib
author_facet	Nabilah Wafa', Mohd Najib
author_sort	Nabilah Wafa', Mohd Najib
title	Financing growth and impaired financing: a study on Malaysian Islamic banks
title_short	Financing growth and impaired financing: a study on Malaysian Islamic banks
title_full	Financing growth and impaired financing: a study on Malaysian Islamic banks
title_fullStr	Financing growth and impaired financing: a study on Malaysian Islamic banks
title_full_unstemmed	Financing growth and impaired financing: a study on Malaysian Islamic banks
title_sort	financing growth and impaired financing: a study on malaysian islamic banks
granting_institution	Universiti Utara Malaysia
granting_department	Othman Yeop Abdullah Graduate School of Business
publishDate	2018
url	https://etd.uum.edu.my/8202/1/s822652_01.pdf https://etd.uum.edu.my/8202/2/s822652_02.pdf
_version_	1747828349952065536
spelling	my-uum-etd.82022021-11-22T01:49:32Z Financing growth and impaired financing: a study on Malaysian Islamic banks 2018 Nabilah Wafa', Mohd Najib Abd Wahab, Norazlina Othman Yeop Abdullah Graduate School of Business Othman Yeop Abdullah Graduate School of Business HG Finance Islamic banking in Malaysia has recorded tremendous development and growth in the last two decades. However, the level of financing growth of Islamic banks has experienced a declination in the recent years due to several factors. The main purpose of this research is to examine the relationship between financing growth and impaired financing particularly. At the same time, it attempts to investigate other determinants of financing growth such as capital (CAP), bank size (SIZE), gross domestic product (GDP), inflation (INF) and overnight policy rate (OPR). This is due to the importance of financing growth towards Islamic banks and lack of empirical research to distinctly establish the determinants of financing growth, especially in Malaysian Islamic banks. The secondary data was used from 16 Islamic banks in Malaysia over the 2012 – 2016 period (80 observations). This study employs Descriptive Statistics, Correlation Analysis, Diagnostic Tests, Panel Data Test and Multiple Regression Analysis as data analysis. The study reveals that external and internal factors, namely GDP, INF, IF and CAP are significantly influencing the financing growth of Malaysian Islamic banks. On the other hand, SIZE and OPR have no significant impact on the financing growth. The results provide statistical evidence that an increase in impaired financing reduces Islamic banks’ financing growth. Hence, the researcher suggests several recommendations to bankers and body regulations in order to minimize the level of impaired financing and thus, enabling the expansion of financing growth level in Malaysian Islamic banks. 2018 Thesis https://etd.uum.edu.my/8202/ https://etd.uum.edu.my/8202/1/s822652_01.pdf text eng 2021-05-22 public https://etd.uum.edu.my/8202/2/s822652_02.pdf text eng public other masters Universiti Utara Malaysia Abduh, A., & Alias, A. (2014). Factors Determine Islamic Banking Performance in Malaysia: A Multiple Regression Approach. Journal of Islamic Banking and Finance, Jan.- March. 2014. Abduh, M., & Idrees, Y. (2013). Determinants of Islamic Banking Profitability in Malaysia. Australian Journal of Basic and Applied Sciences, 7(2): 204-210, 2013. Adries, A. M. (2009). Theories regarding financial intermediation and financial intermediaries – a survey. The USV Annals of Economics and Public Administration 9 (2), 254-261. Agha, S. E. U., & Sabirzyanov, R. 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Financing growth and impaired financing: a study on Malaysian Islamic banks

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