Competition, regulation, and systemic risk in dual banking systems

<p>This study investigates the impact of competition and banking regulation on the systemic risk of Islamic Banks (IBs) and Conventional Banks (CBs). Utilizing a random effects panel model with robust errors and an unbalanced panel data set encompassing 80 IBs and 204 CBs from 17 emerging mark...

وصف كامل

محفوظ في:
التفاصيل البيبلوغرافية
المؤلف الرئيسي: Indria Ernaningsih (17871056) (author)
مؤلفون آخرون: Houcem Smaoui (17871059) (author), Ines Ben Salah (18560509) (author)
منشور في: 2024
الموضوعات:
الوسوم: إضافة وسم
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author Indria Ernaningsih (17871056)
author2 Houcem Smaoui (17871059)
Ines Ben Salah (18560509)
author2_role author
author
author_facet Indria Ernaningsih (17871056)
Houcem Smaoui (17871059)
Ines Ben Salah (18560509)
author_role author
dc.creator.none.fl_str_mv Indria Ernaningsih (17871056)
Houcem Smaoui (17871059)
Ines Ben Salah (18560509)
dc.date.none.fl_str_mv 2024-06-01T00:00:00Z
dc.identifier.none.fl_str_mv 10.1016/j.iref.2024.03.078
dc.relation.none.fl_str_mv https://figshare.com/articles/journal_contribution/Competition_regulation_and_systemic_risk_in_dual_banking_systems/25826929
dc.rights.none.fl_str_mv CC BY 4.0
info:eu-repo/semantics/openAccess
dc.subject.none.fl_str_mv Commerce, management, tourism and services
Banking, finance and investment
Bank competition
Systemic risk
Islamic banking
Bank regulation
dc.title.none.fl_str_mv Competition, regulation, and systemic risk in dual banking systems
dc.type.none.fl_str_mv Text
Journal contribution
info:eu-repo/semantics/publishedVersion
text
contribution to journal
description <p>This study investigates the impact of competition and banking regulation on the systemic risk of Islamic Banks (IBs) and Conventional Banks (CBs). Utilizing a random effects panel model with robust errors and an unbalanced panel data set encompassing 80 IBs and 204 CBs from 17 emerging market countries spanning 2000 to 2019, we show that the lack of competition increases systemic risk exposure, which may stem from the interconnection channels and the individual bank risk contributions. Interestingly, this effect is not significantly different between IBs and CBs. Our results also reveal a non-linear relationship between competition and systemic risk. Specifically, greater competition leads to increased systemic stability, but beyond a certain threshold, higher competition exacerbates banks' systemic risk. Additionally, we find that larger banks are more vulnerable to systemic risk, and the lack of competition worsens this vulnerability. We also show that banks with greater market power after the GFC are more exposed to systemic risk.</p><h2>Other Information</h2> <p> Published in: International Review of Economics & Finance<br> License: <a href="http://creativecommons.org/licenses/by/4.0/" target="_blank">http://creativecommons.org/licenses/by/4.0/</a><br>See article on publisher's website: <a href="https://dx.doi.org/10.1016/j.iref.2024.03.078" target="_blank">https://dx.doi.org/10.1016/j.iref.2024.03.078</a></p>
eu_rights_str_mv openAccess
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identifier_str_mv 10.1016/j.iref.2024.03.078
network_acronym_str Manara2
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oai_identifier_str oai:figshare.com:article/25826929
publishDate 2024
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spelling Competition, regulation, and systemic risk in dual banking systemsIndria Ernaningsih (17871056)Houcem Smaoui (17871059)Ines Ben Salah (18560509)Commerce, management, tourism and servicesBanking, finance and investmentBank competitionSystemic riskIslamic bankingBank regulation<p>This study investigates the impact of competition and banking regulation on the systemic risk of Islamic Banks (IBs) and Conventional Banks (CBs). Utilizing a random effects panel model with robust errors and an unbalanced panel data set encompassing 80 IBs and 204 CBs from 17 emerging market countries spanning 2000 to 2019, we show that the lack of competition increases systemic risk exposure, which may stem from the interconnection channels and the individual bank risk contributions. Interestingly, this effect is not significantly different between IBs and CBs. Our results also reveal a non-linear relationship between competition and systemic risk. Specifically, greater competition leads to increased systemic stability, but beyond a certain threshold, higher competition exacerbates banks' systemic risk. Additionally, we find that larger banks are more vulnerable to systemic risk, and the lack of competition worsens this vulnerability. We also show that banks with greater market power after the GFC are more exposed to systemic risk.</p><h2>Other Information</h2> <p> Published in: International Review of Economics & Finance<br> License: <a href="http://creativecommons.org/licenses/by/4.0/" target="_blank">http://creativecommons.org/licenses/by/4.0/</a><br>See article on publisher's website: <a href="https://dx.doi.org/10.1016/j.iref.2024.03.078" target="_blank">https://dx.doi.org/10.1016/j.iref.2024.03.078</a></p>2024-06-01T00:00:00ZTextJournal contributioninfo:eu-repo/semantics/publishedVersiontextcontribution to journal10.1016/j.iref.2024.03.078https://figshare.com/articles/journal_contribution/Competition_regulation_and_systemic_risk_in_dual_banking_systems/25826929CC BY 4.0info:eu-repo/semantics/openAccessoai:figshare.com:article/258269292024-06-01T00:00:00Z
spellingShingle Competition, regulation, and systemic risk in dual banking systems
Indria Ernaningsih (17871056)
Commerce, management, tourism and services
Banking, finance and investment
Bank competition
Systemic risk
Islamic banking
Bank regulation
status_str publishedVersion
title Competition, regulation, and systemic risk in dual banking systems
title_full Competition, regulation, and systemic risk in dual banking systems
title_fullStr Competition, regulation, and systemic risk in dual banking systems
title_full_unstemmed Competition, regulation, and systemic risk in dual banking systems
title_short Competition, regulation, and systemic risk in dual banking systems
title_sort Competition, regulation, and systemic risk in dual banking systems
topic Commerce, management, tourism and services
Banking, finance and investment
Bank competition
Systemic risk
Islamic banking
Bank regulation