Competition, regulation, and systemic risk in dual banking systems

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 countr...

وصف كامل

محفوظ في:
التفاصيل البيبلوغرافية
المؤلف الرئيسي: Ernaningsih, Indria (author)
مؤلفون آخرون: Smaoui, Houcem (author), Ben Salah, Ines (author)
التنسيق: article
منشور في: 2024
الموضوعات:
الوصول للمادة أونلاين:http://dx.doi.org/10.1016/j.iref.2024.03.078
https://www.sciencedirect.com/science/article/pii/S1059056024002430
http://hdl.handle.net/10576/55061
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_version_ 1857415083852824576
author Ernaningsih, Indria
author2 Smaoui, Houcem
Ben Salah, Ines
author2_role author
author
author_facet Ernaningsih, Indria
Smaoui, Houcem
Ben Salah, Ines
author_role author
dc.creator.none.fl_str_mv Ernaningsih, Indria
Smaoui, Houcem
Ben Salah, Ines
dc.date.none.fl_str_mv 2024-05-16T09:15:12Z
2024-06-30
dc.format.none.fl_str_mv application/pdf
dc.identifier.none.fl_str_mv http://dx.doi.org/10.1016/j.iref.2024.03.078
Ernaningsih, I., Smaoui, H., & Salah, I. B. (2024). Competition, regulation, and systemic risk in dual banking systems. International Review of Economics & Finance, 93, 1087-1103.
1059-0560
https://www.sciencedirect.com/science/article/pii/S1059056024002430
http://hdl.handle.net/10576/55061
1087-1103
93
1873-8036
dc.language.none.fl_str_mv en
dc.publisher.none.fl_str_mv Elsevier Inc.
dc.rights.none.fl_str_mv http://creativecommons.org/licenses/by/4.0/
info:eu-repo/semantics/openAccess
dc.subject.none.fl_str_mv 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 Article
info:eu-repo/semantics/publishedVersion
info:eu-repo/semantics/article
description 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.
eu_rights_str_mv openAccess
format article
id qu_f07dbdff4a2f86daa14bc0285823b569
identifier_str_mv Ernaningsih, I., Smaoui, H., & Salah, I. B. (2024). Competition, regulation, and systemic risk in dual banking systems. International Review of Economics & Finance, 93, 1087-1103.
1059-0560
1087-1103
93
1873-8036
language_invalid_str_mv en
network_acronym_str qu
network_name_str Qatar University repository
oai_identifier_str oai:qspace.qu.edu.qa:10576/55061
publishDate 2024
publisher.none.fl_str_mv Elsevier Inc.
repository.mail.fl_str_mv
repository.name.fl_str_mv
repository_id_str
rights_invalid_str_mv http://creativecommons.org/licenses/by/4.0/
spelling Competition, regulation, and systemic risk in dual banking systemsErnaningsih, IndriaSmaoui, HoucemBen Salah, InesBank competitionSystemic riskIslamic bankingBank regulationThis 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.Elsevier Inc.2024-05-16T09:15:12Z2024-06-30Articleinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://dx.doi.org/10.1016/j.iref.2024.03.078Ernaningsih, I., Smaoui, H., & Salah, I. B. (2024). Competition, regulation, and systemic risk in dual banking systems. International Review of Economics & Finance, 93, 1087-1103.1059-0560https://www.sciencedirect.com/science/article/pii/S1059056024002430http://hdl.handle.net/10576/550611087-1103931873-8036enhttp://creativecommons.org/licenses/by/4.0/info:eu-repo/semantics/openAccessoai:qspace.qu.edu.qa:10576/550612024-07-23T10:58:45Z
spellingShingle Competition, regulation, and systemic risk in dual banking systems
Ernaningsih, Indria
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 Bank competition
Systemic risk
Islamic banking
Bank regulation
url http://dx.doi.org/10.1016/j.iref.2024.03.078
https://www.sciencedirect.com/science/article/pii/S1059056024002430
http://hdl.handle.net/10576/55061