Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council

Khaled Naser Al-khawaldah; Alaaeddin Awad Al-tarawneh; Ghazi-alassaf

doi:doi:10.11648/j.ijber.20200904.17

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Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council

Khaled Naser Al-khawaldah, Alaaeddin Awad Al-tarawneh, Ghazi-alassaf

Published in International Journal of Business and Economics Research (Volume 9, Issue 4)

Received: 1 May 2020 Accepted: 8 June 2020 Published: 4 July 2020

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Abstract

The purpose of this study examines the effect of the capital adequacy on the return on equity for the largest 16 Islamic banks in gulf cooperation council in terms of market value, using panel data analysis during the Period (2010-2014) and the effect the size, inflation, and GDP as a control variables, Also to explain how Islamic banks comply with international solvency standards (Basel), and the extent to which those standards with special nature of the Islamic banks and their impact on earnings of these banks. The study data collected from published annual reports for banks The capital adequacy is the main tool to measure the bank’s ability to meet its obligation and liabilities It is a one of the risk exposure scales of banks, such as credit risk, market risk, and operational risk. Islamic banks have special standards issued by the accounting and auditing organization for Islamic financial institutions (AAOIFI) and the council of Islamic financial services board (IFSB). The study found that there is a significant relationship between capital adequacy and return on equity in the absence and in the presence of control variables and the relationship was negative, size has a statistically significant positive effect on the return on equity, inflation has a statistically significant negative effect on the return on equity, GDP has a statistically significant positive effect on the return on equity.

Published in	International Journal of Business and Economics Research (Volume 9, Issue 4)
DOI	10.11648/j.ijber.20200904.17
Page(s)	207-210
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Capital Adequacy, Return on Equity, Islamic Banks

References

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APA Style

Khaled Naser Al-khawaldah, Alaaeddin Awad Al-tarawneh, Ghazi-alassaf. (2020). Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council. International Journal of Business and Economics Research, 9(4), 207-210. https://doi.org/10.11648/j.ijber.20200904.17

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ACS Style

Khaled Naser Al-khawaldah; Alaaeddin Awad Al-tarawneh; Ghazi-alassaf. Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council. Int. J. Bus. Econ. Res. 2020, 9(4), 207-210. doi: 10.11648/j.ijber.20200904.17

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AMA Style

Khaled Naser Al-khawaldah, Alaaeddin Awad Al-tarawneh, Ghazi-alassaf. Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council. Int J Bus Econ Res. 2020;9(4):207-210. doi: 10.11648/j.ijber.20200904.17

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@article{10.11648/j.ijber.20200904.17,
  author = {Khaled Naser Al-khawaldah and Alaaeddin Awad Al-tarawneh and Ghazi-alassaf},
  title = {Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council},
  journal = {International Journal of Business and Economics Research},
  volume = {9},
  number = {4},
  pages = {207-210},
  doi = {10.11648/j.ijber.20200904.17},
  url = {https://doi.org/10.11648/j.ijber.20200904.17},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijber.20200904.17},
  abstract = {The purpose of this study examines the effect of the capital adequacy on the return on equity for the largest 16 Islamic banks in gulf cooperation council in terms of market value, using panel data analysis during the Period (2010-2014) and the effect the size, inflation, and GDP as a control variables, Also to explain how Islamic banks comply with international solvency standards (Basel), and the extent to which those standards with special nature of the Islamic banks and their impact on earnings of these banks. The study data collected from published annual reports for banks The capital adequacy is the main tool to measure the bank’s ability to meet its obligation and liabilities It is a one of the risk exposure scales of banks, such as credit risk, market risk, and operational risk. Islamic banks have special standards issued by the accounting and auditing organization for Islamic financial institutions (AAOIFI) and the council of Islamic financial services board (IFSB). The study found that there is a significant relationship between capital adequacy and return on equity in the absence and in the presence of control variables and the relationship was negative, size has a statistically significant positive effect on the return on equity, inflation has a statistically significant negative effect on the return on equity, GDP has a statistically significant positive effect on the return on equity.},
 year = {2020}
}

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TY  - JOUR
T1  - Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council
AU  - Khaled Naser Al-khawaldah
AU  - Alaaeddin Awad Al-tarawneh
AU  - Ghazi-alassaf
Y1  - 2020/07/04
PY  - 2020
N1  - https://doi.org/10.11648/j.ijber.20200904.17
DO  - 10.11648/j.ijber.20200904.17
T2  - International Journal of Business and Economics Research
JF  - International Journal of Business and Economics Research
JO  - International Journal of Business and Economics Research
SP  - 207
EP  - 210
PB  - Science Publishing Group
SN  - 2328-756X
UR  - https://doi.org/10.11648/j.ijber.20200904.17
AB  - The purpose of this study examines the effect of the capital adequacy on the return on equity for the largest 16 Islamic banks in gulf cooperation council in terms of market value, using panel data analysis during the Period (2010-2014) and the effect the size, inflation, and GDP as a control variables, Also to explain how Islamic banks comply with international solvency standards (Basel), and the extent to which those standards with special nature of the Islamic banks and their impact on earnings of these banks. The study data collected from published annual reports for banks The capital adequacy is the main tool to measure the bank’s ability to meet its obligation and liabilities It is a one of the risk exposure scales of banks, such as credit risk, market risk, and operational risk. Islamic banks have special standards issued by the accounting and auditing organization for Islamic financial institutions (AAOIFI) and the council of Islamic financial services board (IFSB). The study found that there is a significant relationship between capital adequacy and return on equity in the absence and in the presence of control variables and the relationship was negative, size has a statistically significant positive effect on the return on equity, inflation has a statistically significant negative effect on the return on equity, GDP has a statistically significant positive effect on the return on equity.
VL  - 9
IS  - 4
ER  -

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Author Information

Khaled Naser Al-khawaldah

School of Business, University of Jordan, Amman, Jordan
Alaaeddin Awad Al-tarawneh

School of Business, University of Jordan, Amman, Jordan
Ghazi-alassaf

School of Business, University of Jordan, Amman, Jordan

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APA Style

Khaled Naser Al-khawaldah, Alaaeddin Awad Al-tarawneh, Ghazi-alassaf. (2020). Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council. International Journal of Business and Economics Research, 9(4), 207-210. https://doi.org/10.11648/j.ijber.20200904.17

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ACS Style

Khaled Naser Al-khawaldah; Alaaeddin Awad Al-tarawneh; Ghazi-alassaf. Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council. Int. J. Bus. Econ. Res. 2020, 9(4), 207-210. doi: 10.11648/j.ijber.20200904.17

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AMA Style

Khaled Naser Al-khawaldah, Alaaeddin Awad Al-tarawneh, Ghazi-alassaf. Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council. Int J Bus Econ Res. 2020;9(4):207-210. doi: 10.11648/j.ijber.20200904.17

Copy | Download

@article{10.11648/j.ijber.20200904.17,
  author = {Khaled Naser Al-khawaldah and Alaaeddin Awad Al-tarawneh and Ghazi-alassaf},
  title = {Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council},
  journal = {International Journal of Business and Economics Research},
  volume = {9},
  number = {4},
  pages = {207-210},
  doi = {10.11648/j.ijber.20200904.17},
  url = {https://doi.org/10.11648/j.ijber.20200904.17},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijber.20200904.17},
  abstract = {The purpose of this study examines the effect of the capital adequacy on the return on equity for the largest 16 Islamic banks in gulf cooperation council in terms of market value, using panel data analysis during the Period (2010-2014) and the effect the size, inflation, and GDP as a control variables, Also to explain how Islamic banks comply with international solvency standards (Basel), and the extent to which those standards with special nature of the Islamic banks and their impact on earnings of these banks. The study data collected from published annual reports for banks The capital adequacy is the main tool to measure the bank’s ability to meet its obligation and liabilities It is a one of the risk exposure scales of banks, such as credit risk, market risk, and operational risk. Islamic banks have special standards issued by the accounting and auditing organization for Islamic financial institutions (AAOIFI) and the council of Islamic financial services board (IFSB). The study found that there is a significant relationship between capital adequacy and return on equity in the absence and in the presence of control variables and the relationship was negative, size has a statistically significant positive effect on the return on equity, inflation has a statistically significant negative effect on the return on equity, GDP has a statistically significant positive effect on the return on equity.},
 year = {2020}
}

Copy | Download

TY  - JOUR
T1  - Evaluation the Impact of Capital Adequacy on the Return on Equity of Islamic Banks in Gulf Cooperation Council
AU  - Khaled Naser Al-khawaldah
AU  - Alaaeddin Awad Al-tarawneh
AU  - Ghazi-alassaf
Y1  - 2020/07/04
PY  - 2020
N1  - https://doi.org/10.11648/j.ijber.20200904.17
DO  - 10.11648/j.ijber.20200904.17
T2  - International Journal of Business and Economics Research
JF  - International Journal of Business and Economics Research
JO  - International Journal of Business and Economics Research
SP  - 207
EP  - 210
PB  - Science Publishing Group
SN  - 2328-756X
UR  - https://doi.org/10.11648/j.ijber.20200904.17
AB  - The purpose of this study examines the effect of the capital adequacy on the return on equity for the largest 16 Islamic banks in gulf cooperation council in terms of market value, using panel data analysis during the Period (2010-2014) and the effect the size, inflation, and GDP as a control variables, Also to explain how Islamic banks comply with international solvency standards (Basel), and the extent to which those standards with special nature of the Islamic banks and their impact on earnings of these banks. The study data collected from published annual reports for banks The capital adequacy is the main tool to measure the bank’s ability to meet its obligation and liabilities It is a one of the risk exposure scales of banks, such as credit risk, market risk, and operational risk. Islamic banks have special standards issued by the accounting and auditing organization for Islamic financial institutions (AAOIFI) and the council of Islamic financial services board (IFSB). The study found that there is a significant relationship between capital adequacy and return on equity in the absence and in the presence of control variables and the relationship was negative, size has a statistically significant positive effect on the return on equity, inflation has a statistically significant negative effect on the return on equity, GDP has a statistically significant positive effect on the return on equity.
VL  - 9
IS  - 4
ER  -

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