Evaluating the Performance of Islamic and Commercial Banks in Jordan:

Ali Matar

Abstract


The current study evaluates the performance of the commercial banks in comparison with the Islamic banks in Jordan during the 2000-2013 period. The Financial Ratio Analysis (FRA) and Data Envelopment Analysis (DEA) on two groups of banks have been employed to perform the evaluating process. The financial ratio analysis involved the employment of liquidity, profitability, and risk and solvency ratios. The results identify an insignificant difference between the profitability of Islamic and commercial banks in Jordan that commercial banks perform better than Islamic banks. On the other vein, the results show that Islamic banks are less risky than commercial banks, indicating that Islamic banks are less affected by financial crises and fluctuations.


Keywords


Islamic banks; Commercial banks; Jordan; Financial Ratios; Data Envelopment Analysis.

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