Installing Islamic banking windows in conventional bank: Effects on performance

摘要

Islamic finance products have become very common in financial transactions, and thus offer new business opportunities. The objective of our study was to investigate the effect of distributing Islamic banking products on the financial performance of commercial banks, over a period of seven years (2010-2017). We use a Correlation analysis to carry out the strength of the relationship between our dependent variable: bank performance variable: return on assets, and independent variables which are Islamic products. Studying the variables collected, we found evidence that there was a significant positive relationship between bank performance: return on asset and Murabaha, Mudaraba, although Ijara had a positive relationship with return on assets but not significant. We notice that all the available Islamic products in commercial banks used, had a positive significant relation with the exclusion of Ijara which had positive insignificant relationship. This implies that an increase in using Islamic banking products in commercial banks will lead to increase in conventional Banks performance.