Conventional banks use money as a commodity which leads to inflation islamic banking tends to create link with the real sectors of the economic system by using trade related activities since, the money is linked with the real assets therefore it contributes directly in the economic development. Essay about comparison between islamic and conventional banks 1297 words | 6 pages comparison between islamic and conventional banks introduction the rapid growth of islamic financial institutions across borders and continents is a testament to the buoyant nature of the islamic banking system. Conventional banking islamic banking money is a commodity besides medium of exchange and store of value therefore, it can be sold at a price higher than its face value and it can also be rented out money is not a commodity though it is used as a medium of exchange and store of value.
Purpose: to determine the financial performance of islamic banks and non-islamic banks from 2003 to 2010 in malaysia by applying the theory of sharī’ah conformity and profitability model. Banking in pakistanthis study is an attempt to understand the mechanism of islamic financial system and document the similarities and differences in comparison with conventional financial system.
The main focus of this comparative study is to evaluate and measure the difference in conventional banking system, bankers of such system are careless about their analytical comparison of the two different banking systems is crucial in terms of financial performance, in other words, the main focus of this comparative study is to. A comparative study on the financial performance between islamic and islamic banking, conventional banking, banks financial performance measures, profitability, egypt abstract there is no doubt that banks have significant position in the welfare of any economy conducted a study to compare the islamic versus conventional banks the. Analytical comparison of the two different banking systems is crucial in terms of financial performance, in other words, the main focus of this comparative study is to evaluate and measure the statistical difference in financial performance of the two.
Comparative study of risk management practices of islamic versus conventional banks in pakistan faizan yasin fuirc, department of business & economics foundation university, 44000, islamabad, pakistan i introduction the conventional banking system is based on interest cost mechanism on the other hand, the interest. Comparison on stability between islamic and conventional banks in malaysia siti rohaya mat rahim1 roza hazli zakaria2 abstract islamic banks were relatively unaffected during the recent financial meltdown this has raised the possibility that financial institutions, operating on islamic principles are more stable compared to their conventional counterparts. Findings: results indicate that conventional banks perform better in profitability, while islamic banks perform better in liquidity and credit risk in t-test of the return on asset (roa) and total equity to net loans, there are no major difference between islamic banks and non-islamic banks.
Conventional banking does not conform to islamic principles in conventional banking, interest is earned by lending money it is based on relationship between the debtor and creditor ie a person deposits the money into the bank and/or borrows the money from bank interest is earned on deposits and lending by respective parties. The study has made suggestions for various essential components like feasible structures, financial instruments, the expert panel or advisory board along with the key players discover the world's.
The study suggests that islamic banks did suffer during crisis in terms of lowering of car, e/ta and roae loghod (2008) compared the financial performance (profitability, liquidity and structure) of islamic and conventional banking from 2000 - 2005 the study found no significant differences in terms of profitability. The empirical findings of the study, revealed that islamic banks outperformed conventional banks in terms of capital adequacy, asset quality, management quality and earnings quality, however they had a weaker liquidity position in comparison to conventional banks.
Compare the performance of islamic banking and conventional banking in gcc akhter  utilized financial ratios to study the efficiency and performance of islamic banking toumi et al  used logistic regression model and discriminant analysis to compare leverage and profitability of islamic banks and conventional banks. Study found similarity between conventional banks and islamic banking on asset quality while conventional banks were found superior in management of quality and earning ability.