Access the full text.
Sign up today, get DeepDyve free for 14 days.
O. Mustafa (2020)
Why do Islamic Banks Concentrating Finance in Murabaha Mode? Performance and Risk Analysis (Sudan: 1997-2018)International Business Research, 13
B. Dao, Hoa Pham (2015)
Corporate Governance and Bank Credit Risk: Default Probability, Distance to DefaultERN: Econometric Studies of Corporate Governance (Topic)
E. Akben-Selcuk (2016)
Does Firm Age Affect Profitability? Evidence from Turkey, 5
T. Chamberlain, S. Hidayat, A. Khokhar (2020)
Credit risk in Islamic banking: evidence from the GCCJournal of Islamic Accounting and Business Research, 11
Tariqullah Khan, Habib Ahmed (2001)
Risk Management: An Analysis of Issues in Islamic Financial Industry (Occasional Paper)
(1952)
Portofolio selection
Muksal Muksal (2018)
The Impact of Non-Performing Financing (NPF) to Profitability (Return On Equity) at Sharia Bank in Indonesia
T. Warninda, I. Ekaputra, R. Rokhim (2019)
Do Mudarabah and Musharakah financing impact Islamic Bank credit risk differently?Research in International Business and Finance
Indonesian Journal of Economics and Development, 8
Yono Haryono, Noraini Ariffin, Mustapha Hamat (2016)
Factors Affecting Credit Risk in Indonesian Islamic Banks, 5
A. Saeed, Attiya Javed, Umara Noreen (2017)
Microfinancing, Governance, and Performance: A South Asian PerspectiveEmerging Markets Economics: Firm Behavior & Microeconomic Issues eJournal
A. Ahmad, S. Yaacob (2012)
The principle of risk management: Sharia perspectivesThe Journal of Applied Sciences Research, 8
Mohammed Abusharbeh (2014)
Credit Risks and Profitability of Islamic Banks: Evidence from Indonesia
Michael Jensen, W. Meckling (1976)
Harvard Business School; SSRN; National Bureau of Economic Research (NBER); European Corporate Governance Institute (ECGI); Harvard University - Accounting & Control UnitLSN: Law & Finance: Empirical (Topic)
International Journal of Services, Economics and Management, 9
Dalvinder Singh (2006)
Corporate governance of financial institutionsJournal of Banking Regulation, 7
Fauziyah Adzimatinur, Vigory Manalu (2020)
The Impact of Mudharabah and Musharakah based Financing to Credit Risk
Anik Anik, Iin Prastiwi (2019)
Macro Economic Challenges and Third Party Funds of Islamic Commercial Banks in IndonesiaShirkah: Journal of Economics and Business
Aisyah Abdul-Rahman, Shifa Nor (2017)
Challenges of profit-and-loss sharing financing in Malaysian Islamic bankingGeografia: Malaysian journal of society and space, 12
P. Wulandari, N. Putri, Salina Kassim, Liyu Sulung (2016)
Contract agreement model for murabahah financing in Indonesia Islamic bankingInternational Journal of Islamic and Middle Eastern Finance and Management, 9
R. Baron, D. Kenny (1986)
The moderator-mediator variable distinction in social psychological research: conceptual, strategic, and statistical considerations.Journal of personality and social psychology, 51 6
(2020)
Snapshot of Indonesia Sharia Bank
S. Sabrina, M. Majid (2020)
The Reluctance Phenomenon of Islamic Banks to Offer Profit-Loss Sharing Financing, 13
Awatef Louhichi, Y. Boujelbene (2016)
Credit risk, managerial behaviour and macroeconomic equilibrium within dual banking systems: Interest-free vs. interest-based banking industriesResearch in International Business and Finance, 38
Mayang Mahrani, N. Soewarno (2018)
The effect of good corporate governance mechanism and corporate social responsibility on financial performance with earnings management as mediating variableAsian Journal of Accounting Research
Islamic Development Bank Islamic Research and Training Institute
Z. Hasan (2011)
A Survey on Shari’Ah Governance Practices in Malaysia, GCC Countries and the UK
Yasushi Suzuki, S. Uddin, A. Islam (2020)
Incentives for conventional banks for the conversion into Islamic banks: evidence from BangladeshJournal of Islamic Accounting and Business Research, 11
M. Hosen, Nasimul Falah, Fitriyani Lathifah (2019)
Analysis of Corporate Governance on Islamic Bank in Indonesia, 19
Hichem Hamza, Zied Saadaoui (2013)
Investment deposits, risk‐taking and capital decisions in Islamic banksStudies in Economics and Finance, 30
Ammar Jreisat (2020)
Credit Risk, Economic Growth and Profitability of BanksInternational Journal of Economics and Business Research
E. Ernawati (2016)
Risk of Profit Loss Sharing Financing: The Case of IndonesiaAl-Iqtishad: Jurnal Ilmu Ekonomi Syariah, 8
Isaac Ofoeda (2016)
Credit risk management and NBFI profitabilityInternational Journal of Financial Services Management, 8
R. Grassa, Hamadi Matoussi (2014)
Is Corporate Governance Different for Islamic Banks? A Comparative Analysis between the Gulf Cooperation Council and Southeast Asian CountriesInternational Journal of Business Governance and Ethics, 9
S. Azizah, Septiana Mukaromah (2020)
THE EFFECT OF MURABAHA FINANCING, PROFIT SHARING FINANCING, INTELLECTUAL CAPITAL, AND NON PERFORMING FINANCING (NPF) ON FINANCIAL PERFORMANCE, 10
H. Akram, K. Rahman (2018)
Credit risk managementISRA International Journal of Islamic Finance
Md. Kabir, A. Worthington, Rakesh Gupta (2015)
Comparative credit risk in Islamic and conventional bankPacific-basin Finance Journal, 34
S. ElMassah (2013)
Risk Aversion and Islamic Finance: An Experimental ApproachFEN: Culture Differences & Corporate Finance (Topic)
A. Dianova, Joicenda Nahumury (2019)
Investigating the Effect of Liquidity, Leverage, Sales Growth and Good Corporate Governance on Financial Distress, 2
Gaffar Ahmed (2008)
The implication of using profit and loss sharing modes of finance in the banking system, with a particular reference to equity participation (partnership) method in SudanHumanomics, 24
Journal of Financial Economics, 3
Abdussalam Abu-Tapanjeh (2009)
Corporate governance from the Islamic perspective: A comparative analysis with OECD principlesCritical Perspectives on Accounting, 20
Azam Ali, Muhamed Zulkhibri, Tanveer Kishwar (2019)
Credit Risk, Bank Performance and Islamic Banking: Evidence from PakistanIslamic Finance, Risk-Sharing and Macroeconomic Stability
Taudlikhul Afkar (2018)
Influence Analysis Of Non Performing Financing By Profit-Loss Sharing Financing Contract To The Profitability Of Islamic Commercial Bank In IndonesiaAKRUAL: Jurnal Akuntansi
R. Grassa (2015)
Corporate governance and credit rating in Islamic banks: Does Shariah governance matters?Journal of Management & Governance, 20
(2015)
The relationship between credit risk and corporate governance in Islamic banking: an empirical study
This study aims to analyse the role of corporate governance in moderating the effects of murabahah, mudharabah and musyarakah financing on the financing risk and financial performance of Islamic banks.Design/methodology/approachThe population for this study covered Islamic banks in Indonesia. Purposive sampling was performed, and statistical analysis was conducted using moderating regression analysis by selecting among the common, fixed and random effects models.FindingsThe results showed that murabahah financing has a positive effect on financing risk; conversely, mudharabah financing has a negative effect on financing risk. By contrast, musyarakah financing has no effect on financing risk. However, corporate governance weakens the influence of murabahah financing on financing risk and increases that of mudharabah financing on financing risk. Further, corporate governance cannot weaken the effect of musyarakah financing on financing risk. Additionally, financing risk reduces financial performance.Research limitations/implicationsThis research focusses only on Indonesian Islamic banks; future research should be extended to Islamic insurance and Islamic micro finance.Practical implicationsThe results serve as input for government regulations on corporate governance in Islamic bank financing and encourage Islamic banks to diversify their financing proportionally.Social implicationsThis research can be used for optimising Islamic bank financing to empower the realty sector and reduce poverty.Originality/valueResearch on the role of corporate governance as a moderating variable in reducing financing risk in Islamic banks remains limited.
Journal of Islamic Accounting and Business Research – Emerald Publishing
Published: Mar 15, 2023
Keywords: Financing risk; Corporate governance; Murabahah; Mudharabah; Musyarakah
Read and print from thousands of top scholarly journals.
Already have an account? Log in
Bookmark this article. You can see your Bookmarks on your DeepDyve Library.
To save an article, log in first, or sign up for a DeepDyve account if you don’t already have one.
Copy and paste the desired citation format or use the link below to download a file formatted for EndNote
Access the full text.
Sign up today, get DeepDyve free for 14 days.
All DeepDyve websites use cookies to improve your online experience. They were placed on your computer when you launched this website. You can change your cookie settings through your browser.