Competition in dual markets: Implications for banking system stability - Gouvernance des Institutions et des Organisations
Article Dans Une Revue Global Finance Journal Année : 2022

Competition in dual markets: Implications for banking system stability

Résumé

This paper investigates whether Islamic and conventional banks' stability is differently impacted by competition in dual markets where the two bank types operate alongside each other. Using a sample of 123 Islamic and 647 conventional banks from 29 countries for a period between 2010 and 2018, we find robust evidence that competition erodes the stability of conventional banks only. The stability of Islamic banks is not impacted specifically where religion is more prevalent. Focusing more deeply on religiosity and the institutional environment, such as the ease of doing business and economic freedom, we also find that such factors matter in differently shaping the competition-fragility nexus for the two types of banks.
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hal-04681689 , version 1 (13-11-2024)

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Tastaftiyan Risfandy, Amine Tarazi, Irwan Trinugroho. Competition in dual markets: Implications for banking system stability. Global Finance Journal, 2022, 52, pp.100579. ⟨10.1016/j.gfj.2020.100579⟩. ⟨hal-04681689⟩
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