- مبلغ: ۸۶,۰۰۰ تومان
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This paper examines the impact of the global financial crisis on the banking sector in the Middle East and North Africa (MENA) region, as well as the main determinants of the profitability of both domestic and foreign banks. The empirical findings suggest that during the crisis the former outperformed the latter in that region. As for the determinants of profitability, size does not appear to play a role, whilst the liquidity ratio and net interest revenues seem to have a negative and positive effect respectively; GDP has a positive effect in the case of domestic banks.
The aim of this paper is to investigate the effects of the global financial crisis on the performance of both domestic and foreign banks in the MENA region, and also to identify the main determinants of their profitability. It provides comprehensive evidence for the MENA region which is of interest also to policy makers and practitioners. The main finding is that domestic banks outperformed foreign banks during the crisis. This reflects the fact that they include the world’s largest Islamic banks (World Bank, 2013), who appear to have had a comparative advantage and to have been less affected by the crisis (Wasiuzzaman et al., 2010; Jones et al., 2013; BBC, 2013; Bourkhis and Sami Nab, 2013). Foreign banks had a higher degree of exposure to risk given their higher number of subsidiaries in the developed economies.
As for the determinants of profitability, size does not appear to play a role (as also found by studies focusing on other countries – see, e.g., Athanasoglou et al., 2008). The liquidity ratio seems to have a negative effect, presumably because higher uncertainty leads to higher liquidity holdings and lower returns (Staikouras et al., 2008; Kosmidou et al., 2007). Net interest revenue has a positive effect (see also Ben Khediri, 2009), and so does GDP in the case of domestic banks.