This website uses cookies to ensure you have the best experience.

# Stability Essay

1072 words - 5 pages

Stability of Islamic and Conventional Banks During the Financial Crisis
1. Ratio Analysis
The performance and the stability of banks can be quantified and measured through the analysis of their financial ratios. We can have several hundreds of ratios at our disposal. However, we will use only those that are common, and of some meaning for the analysis of the banks. Also, it is important to note that we should use only major and comparable ratios in order to fully understand the financial position of these banks as compared to all those ratios that may include some vagueness in the research.
Mainly five categories of these financial ratios are used to eliminate the vagueness created by ...view middle of the document...

A z-score represents the number of standard deviations by which the return on asset have to decrease in order to incur a loss (a negative return). Z-scores can be measured by the following formula:
z = (ROA+CAP)/σ (ROA) where:
ROA (Return on Assets) = Net Income / Total Assets;
CAP (Capital to Asset Ratio) = Equity / Total Assets; and
σ (ROA) = standard deviation of return on assets (proxy for the variation of return).
According to the formula, the higher z-score means that the equity base and the return added on it is much higher than the potential risk to the earnings as measured by the standard deviations. Hence, such usage of the z-score testing as the test for measuring risk is recommended by many researches in the field. By the definition of the z-score here, we can say that it directly relates to the probability of a bank’s insolvency. It is necessary for us to evaluate and understand the extent to which Islamic banks are risky as compared to conventional banks. Z-scores will play an integral role in helping us identify the risk profile of Islamic banks.
3. Regression
One of the most extensively used statistical measure of conformity is the use of regression and correlation. The extent to which two different datasets match in terms of moving together is evaluated by a regression analysis. In this context, we will be looking closely at how the dataset we obtained for Islamic and conventional banks will be moving in tandem with the GDP and inflation (CPI) of their respective countries.
A pooled regression test will be used to perform the respective tests and statistics generated from the regression such as the R-squared value will be used to make judgments on the relationship between the profitability and growth of Islamic and conventional banks with respect to their national growth and inflation. This test is extremely as it is crucial to understand the synchronization of growth of these banks with their national economies. It would be difficult to make pre-assumptions about either Islamic or conventional banks however, it has generally been seen that while conventional banks were wiped of several...

## Other Papers Like Stability

### Assess The View That The Main Function Of Religion Is To Promote Social Stability

1268 words - 6 pages Assess the view that the main function of religion is to promote social stability (33 marks) Social stability refers to harmony and integration within society, the main function of religion has long been argued between sociologists depending on their perspective. Among those that agree are functionalists, for example Durkheim and his study on totem worship, on the other hand Marxists argue religion oppresses the proletariat in order to maintain

### Assess the Reasons for the Failure of the Romanov Dynasty to Achieve Stability by 1917

1353 words - 6 pages “Assess the reasons for the failure of the Romanov dynasty to achieve stability by 1917” The start of the 20th century brought radical changes to the political and social structure of the autocratic Russian Empire. It was a time of regression, reform, revolution and eradication. A short period between the end of February through to the start of March 1917, Tsarist Russia and the Romanov dynasty had come to an end. The Romanov family, who

### Oligopoly (Economics) 1) Main Assumptions Of Oligopoly 2) Price Stability In Oligopoly

781 words - 4 pages stability (when prices are stable, without any change) existing in a situation of Oligopoly are two. The first reason is due to the shapes of the Demand curve (AR). Putting an example of gasoline stations, if there are three companies in this market (Shell, Texaco and Mobil), and if one company, for example shell, decides to increase its prices, no other company will follow, and its sales will decrease by a lot (there will be no incentive for

### The Main Threat to Weimar Stability Between 1919-23 Came from the Right. How Far Do You Agree?

868 words - 4 pages The Main threat to Weimar stability between 1919-23 came from the right. How far do you agree? The right WERE a serious problem to stability for the Weimar between 1919-23. But so were the far left, some aspects of the new constitution and the country was also threatened by economic challenges that threatened to overwhelm her. Some of this was due to Versailles but some was due to overspending accrued in the build up to WWI. There can be

### Targeting Specific PDZ Domains Of PSD-95: Structural Basis For Enhanced Affinity And Enzymatic Stability Of A Cyclic Peptide Dayong

4006 words - 17 pages target for PDZ-domain specificity as well as producing a 10-fold enhancement in binding affinity. Additionally, the cyclization greatly enhances the enzymatic stability, increasing the duration that the peptide inhibits the association between PSD-95 and glutamate receptors, effectively inhibiting the clustering of kainate receptors for over 14 hr after application. Highly specific regulation of kainate receptor action may provide a novel route

### The Main Threat to the Stability of the Weimar Republic from 1919 – 1923 Came from the Political Violence of the Extreme Right” How Far Do You Agree?

906 words - 4 pages “The main threat to the stability of the Weimar Republic from 1919 – 1923 came from the political violence of the extreme right” How far do you agree? Many have argued that the political violence of the extreme right was the main threat to the stability of the Weimar. However, despite elements of this argument being true; one could suggest that there are other factors that contributed to the end of the Republic, such as the constitution

### Explain The Role Of Theories In Understanding Child Development, Describe The Three Basic Issues On Which Major Theories Take A Stand, And Explain The Concepts Of Plasticity And Stability In...

5909 words - 24 pages Period Day Dates 1 2 3 4 5 6 7 8 9 Day 5 Day 6 Day 7 Day 8 Day 9 Day 10 Day 11 Day 12 Day 13 Day 14 Day 15 Day 16 Day 17 Day 18 Day 19 Day 20 Day 21 Day 22 Day 23 Day 24 Day 25 Day 26 Day 27 Day 28 Day 29 Day 30 Day 31 Day 32 Day 33 Day 34 Day 35 Day 36 Day 37 Day 38 Day 39 Day 40 Day 41 Day 42 Day 43 Day 44 Day 45 Day 46 Day 47 Day 48 Day 49 6-Jan 7-Jan 8-Jan 9-Jan 10-Jan 11-Jan

### Mechanical Engineering

2595 words - 11 pages Stability of Power Systems Student’s Name The Name of the Class (Course) Professor (Tutor) The Name of the School (University) The City and State where it is located The Date Date of Submission Stability of Power Systems Power systems are studied under the branch of engineering known as power (systems) engineering. The subfield is concerned with the study of how electric power is generated, transmitted

### Economics

3398 words - 14 pages The pursuit of financial stability* It gives me great pleasure to address this gathering at the 7th Annual Conference on Money and Finance in the Indian economy organised by the Indira Gandhi Institute of Development Research (IGIDR). Issues related to monetary policy and financial sector continue to attract a lot of research interest all over the world and this is all the more true for emerging economies like India which are gradually

### Sport Cricket

617 words - 3 pages What we can learn 1. We should look at teams and leagues that have been successful and analyze why, and look to emulate their business models. 2. If you see something that is promising and you find someone with enough mone to finance it, it is possible to see rapid growth 3. Stadiums are one of the largest expenses for teams and the IPL has elected to pla at existing stadiums thus saving huge costs financially 4. Found stability in fincnace

### Personality

471 words - 2 pages higher performance, enhanced leadership qualities and greater longevity. Conscientious is one of the dimensions which is most consistently related to job performance Next, the emotional stability dimension taps on a person’s ability to withstand stress. A person who has high emotional stability is secure, self-confident and calm while a person who has low emotional stability is insecure, anxious, nervous, and depressed. People who are stable have

## Related Essays

### Stability Of Power Systems Essay

2595 words - 11 pages Stability of Power Systems Student’s Name The Name of the Class (Course) Professor (Tutor) The Name of the School (University) The City and State where it is located The Date Date of Submission Stability of Power Systems Power systems are studied under the branch of engineering known as power (systems) engineering. The subfield is concerned with the study of how electric power is generated, transmitted, distributed, and

### Stability In The Middle East Essay

963 words - 4 pages When we look at developed country we can see the innovation and adaptability within the government and the citizens within. The fundamental to the success of the wealthy and industrialized countries is the capability to account for variable change. The economic and social environment is rapidly changing, a country can sustain stability only if it can effectively anticipate and respond to the changing demands (Brown, 2011). In the Middle East

### Financial Stability And Health In Determining Relationship Commitment

3056 words - 13 pages Financial Stability and Health in Determining Relationship Commitment Ariel Luna Western Washington University Abstract This study is interesting in determining which characteristics in a male potential partner a female values more when looking at financial stability and health when considering that partner as a contender in a committed romantic relationship. With a sample of 56 single heterosexual females and 4 single bisexual females all

### What Accounts For The Stability Of The Tokugawa Regime?

2012 words - 9 pages What Accounts for the Stability of the Tokugawa Regime?             In the first half of the Seventeenth century, the regime perfected by Ieyasu Tokugawa and his successors was based on the accepted system of daimyô domains which Nobunaga and Hideyoshi had been developing prior to Ieyasu’s rule. It was thus basically feudal in structure, but it represented a highly organised and stable stage of