Ownership Structure, Bank Capital and Bank Lending/Financing Behaviour in a Dual Banking System
Nor Faezah Ghazi Ahmad1, Nor Aiza Mohd Zamil2, Rohaida Basiruddin3, Sarah Athirah Saruchi4
1Nor Faezah Ghazi Ahmad, Azman Hashim International Business School, Universiti Teknologi Malaysia.
2Nor Aiza Mohd Zamil, Azman Hashim International Business School, Universiti Teknologi Malaysia.
3Rohaida Basiruddin, Azman Hashim International Business School, Universiti Teknologi Malaysia.
4Sarah Athirah Saruchi, Azman Hashim International Business School, Universiti Teknologi Malaysia.
Manuscript received on 01 September 2019 | Revised Manuscript received on 10 September 2019 | Manuscript Published on 23 September 2019 | PP: 233-237 | Volume-8 Issue-5C, May 2019 | Retrieval Number: E10340585C19/19©BEIESP | DOI: 10.35940/ijeat.E1034.0585C19
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© The Authors. Blue Eyes Intelligence Engineering and Sciences Publication (BEIESP). This is an open access article under the CC-BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/)
Abstract: Credit supply in the market is crucial in order to ensure sustainable real production can survive in the market as well as to strengthen economic activity. Therefore, it is not surprising that when the financial crisis occurred in 2008 to 2009, policymakers continued to use a variety of mechanisms such that banks could continue to maintain their credit supply. Nevertheless, risk sharing based on the business model that was adopted by Islamic banks displayed different behaviour from the conventional banks. Based on prior studies, the stability of financing growth by Islamic banks as compared to lending growth of conventional banks showed the model used by Islamic banks was more capable of effectively withstanding the financial crisis. Therefore, research into the quality of lending and financing is important to understand the growth of bank lending and financing behaviour in the market. Hence, the main objective of this study is to review the effect of ownership structure, bank capital and bank lending including financing behaviour in Islamic versus conventional banks. In addition, this study proposes a conceptual framework to further comprehend the decisions made in undertaking ownership structure, bank capital and lending in the dual banking system.
Keywords: Bank Lending, Ownership Structure, Bank Capital, Islamic banks, Conventional banks.
Scope of the Article: System Integration