Faculty of Economics and Management of Sfax

Faculty of Economics and Management of Sfax

Ines Ben Salah

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Abstract

The aim of this paper is to investigate the determinants and the joint relationship between capital, risk and liquidity of conventional and Islamic banks. Particularly, we focus on the impact of financial and political instabilities on the risk-taking behavior of conventional and Islamic banks. Using the simultaneous equation model with partial adjustment, we find a positive bidirectional relationship between capital and risk of Islamic banks. Moreover, results highlight the risky aspect of this category of banks mainly caused by the type of contracts put in practice, obeying Sharia principles, such as Moudharaba and Moucharaka contracts. Also, changes in liquidity affect positively risk within Islamic and conventional banks, suggesting that both types of banks, by accumulating liquid assets; tend to have relatively riskier portfolios. Moreover, we find a significant impact of the Global financial crisison the capital, risk and liquidity of conventional and Islamic banks.

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Funding

No external funding was declared for this work.

Conflict of Interest

The authors declare no conflict of interest.

Ethical Approval

No ethics committee approval was required for this article type.

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Not applicable for this article.

How to Cite This Article

Ines Ben Salah. 2017. \u201cFaculty of Economics and Management of Sfax\u201d. Global Journal of Management and Business Research - C: Finance GJMBR-C Volume 17 (GJMBR Volume 17 Issue C4).

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Journal Specifications

Crossref Journal DOI 10.17406/GJMBR

Print ISSN 0975-5853

e-ISSN 2249-4588

Keywords

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GJMBR-C Classification JEL Code: A20

Submission ReceivedDecember 14, 2016
Peer Review Double Blind
Handling Editor
Accepted December 31, 2016
Published January 15, 2017

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Issue date

August 12, 2017

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Article Matrices

Total Score: 101

Country: Tunisia

Subject: Global Journal of Management and Business Research - C: Finance

Authors: Ines Ben Salah (PhD/Dr. count: 0)

View Count (all-time): 159

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Publish Date: 2017 08, Sat

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Total Views: 3495

Total Downloads: 1683

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