Efficiency analysis of conventional and Islamic banks in Indonesia using data envelopment analysis

Type :

Research papers

Pages :

18 pages

Format :

.doc

Published date :

10/01/2009

Category :

Economics & finance

Sub category :

Finance

Oboulo.com selection criteria

$ 19.95 Add to cart

Summary :

Introduction
1. Background
2. Objective and the scope of study
Banking efficiency
1. Efficiency of Islamic banks using DEA application
2. The efficiency measurement
3. Summary of non-parametric approach applied
Understanding the theory of efficiency
1. Production frontier line
2. The measurement of efficiency
3. Tools to measure efficiency
4. Non-parametric approach DEA
Measuring the activity of banks
1. Production approach
2. Intermediation approach
3. Modern approach
Efficiency of conventional and Islamic banks in Indonesia using DEA
Returns to scale of conventional and Islamic banks in Indonesia
Potential improvements for conventional and Islamic banks in Indonesia
Efficiency of conventional and Islamic banks in Indonesia using DEA vs. OCOI ratio
Conclusions and recommendations
References
Appendix

Abstract

islamic banks have been in existence since early 1960s. The first islamic bank was established in 1963 as a pilot project in the form of rural savings bank in a small town of Egypt, Mit Ghamr. After that, islamic banking movement came back to life in mid 1970s. The establishment of islamic Development Bank in 1975 triggered the development of islamic banks in many countries, such as Dubai islamic Bank in Dubai (1975), Faisal islamic Bank in Egypt and Sudan (1977), and Kuwait Finance House in Kuwait (1977).
Joharris (2007) predicted that there are over 276 islamic financial institutions (IFI) in the world, spread over 70 countries - sprawling from London, New York and Zurich to the Middle East, Africa and Asia with capitalization in excess of US$13 billion. These include banks, mutual funds, mortgage companies and takaful providers. The pool of money held by Muslim is predicted more than US$3.0 trillion. At present, there is an estimated US$1 trillion islamic fund in the market. Moreover, global islamic capital market is growing at 15% - 20% per annum, including deposits in islamic banks which are estimated to be over US$560 billion. A large part of the banking and Takaful concentration is in Bahrain, Malaysia, and Sudan. A significant part of mutual funds concentrate in the Saudi Arabian and Malaysian markets in addition to the more advanced international capital markets.