Kembali | Vol 6, No 1 (2017)
Article
Warih Sutopo dan Muh Juan Suam Toro
Abstract
This study is based on the new phenomenon in the financial system, especially in the banking sector where there is competition between the conventional banking and islamic banking system. This research was conducted in order to determine the difference in performance (financial) of Islamic banking and conventional banking in terms of business model, efficiency, asset quality, and stability. This study uses the sample data from the financial statements of Islamic banking and conventional banking in Indonesia and Malaysia in the period of 2010-2014 sampling in both countries because both countries have the same characteristics of the majority Muslim population and culture. In this study also aims to look at the extent to which differences in the performance of Islamic banking in both countries between Malaysia and Indonesia. By using descriptive statistical analysis methods and test the average difference (Paired Sample T-Test) showed that there are significant differences between Islamic banking to conventional banking. Islamic banks better intermediation function and more resistant to potential bankruptcy. While Islamic banks better in terms of efficiency, asset quality, and generate profit. Meanwhile, Islamic banking in Malaysia is still better in terms of efficiency, quality of assets and the intermediary function compared islamic banking in Indonesia.
Keywords
Islamic Banking, Conventional Banking, Bank Performance
