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This paper aims to assess the nature of competition between conventional and Islamic banks operating in Malaysia. It is an effort to enrich the existing literature by offering an empirical compromise on the differences in the results of studies related to competition between the two types of banks.

Secondary data on all banks operating in Malaysia’s diversified banking sector is collected from the FitchConnect database for the period 2011-2017. A non-structural measure of competition (H-statistic) as informed by Panzar–Rosse is used to measure the competition between conventional and Islamic banks. Panel data analysis techniques are used to estimate H-statistic. Wald test for the market structure of perfect competition/monopoly is used to affirm the validity and consistency of the results.

The findings of this study signify that the Malaysian banking sector operated under monopolistic competition during the period of study. The long-run equilibrium condition holds for the Malaysian banking sector. Competition among conventional banks is more intense than that among Islamic banks. Financial reform endeavours of Bank Negara Malaysia (BNM) along with the liberalisation wave of the financial system were successful in promoting competition, rendering the financial system contestable, resilient and dynamic.

Regulators and policymakers may find the results beneficial in terms of rethinking the number of banks operating in the Islamic sector. The number of banks, however, is not the only determinant of competition in the banking sector. Implications of competition change for stability and risk-taking behaviour of banks should be considered.

Within the context of Malaysia’s diversified banking system, given the contradictory results reported in studies on competition, this study is an effort to provide a plausible middle ground. It suggests a possible answer as to why competition nature has not changed since the policy change initiatives of BNM, namely, banks merger, expansion of Islamic banking operation scope and liberalisation process.

The purpose of this paper is to examine the relationship between bank diversity and small- and medium-sized enterprise (SME) firm innovation in China to evaluate the impact of recent bank deregulation.

Using a large data set that includes 8,143 firm-year observations of 1,122 listed SME firms in China and baseline and robustness regression analyses, the authors identify how bank diversity affects firm innovation and via what economic mechanisms. Potential endogeneity problems are considered and addressed in the design and analysis to minimize research bias.

The authors find robust evidence that bank diversity improves firm innovation. Specifically, the findings suggest that the positive effects of bank diversity on firm innovation are only significant for the firms which are more external finance dependent, have fewer growth opportunities and/or located in the provinces having low financial market development.

This study provides novel evidence and insights into the relationship between banking market structure and the determinants of firm innovation in the Chinese context, as a result of China’s banking deregulation.

The banking system has a huge impact on a nation's economic environment. A concentrated banking system has a negative impact on the economy. Therefore, the research in this paper has two main goals: to explore the main factors that impact the level of concentration in the banking system; and to demonstrate how a reform in a banking system can reduce the negative impact of high levels of concentration.

A sample of 42 nations was used with various levels of concentration in their banking system to examine factors influencing bank concentration. Logit and OLS regressions were conducted to highlight the impact of the independent variables on the level of concentration in those nations. The latest Israeli reforms in the banking system were used to illustrate how reforms reduce concentration.

The empirical results concluded that economic freedom had a positive impact on the level of concentration. It was also found that cultural variables had an impact on the concentration level. Finally, analyzing the banking sector in Israel, it was found that the reform did decrease the level of concentration of the banking system.

The innovation of this paper is that it adds Hofstede's cultural variables as explanatory variables for the level of concentration in the banking system. It also highlights the role of public regulation for achieving efficiency in the banking sector by using the example of Israeli banking reforms.

The purpose of this paper is to examine the two‐step process of bank privatization in Mexico in the 1990s that necessitated a government bailout quite costly to Mexican taxpayers, and which has become emblematic as a cause of resentment against market liberalization among the Mexican public in recent years. This paper seeks to identify lessons to be learned from bank privatization in an important emerging market.

Information was collected through secondary sources and field research in Mexico and abroad.

The findings in this paper indicate that the bank privatization process was characterized by inadequate regulatory and financial controls which permitted large‐scale corruption and fraud resulting in a subsequent bank bailout by the Mexican Government. This created a major transfer of wealth from Mexican taxpayers to some of Mexico's wealthiest citizens, who owned or operated banks after the first wave of privatization. The subsequent sale of Mexican banks to foreign investors has also resulted in disappointment, as the quality of service remains poor and banks are inadequate in serving the financial needs of the private sector, necessary for the country's development.

This study identifies the flaws in the bank privatization process in an emerging market, as well as the problems presented by an inadequate legal and regulatory framework.

This is a case study of the background and current situation confronting the financial sector in a significant emerging market.

For over a 100 years, Macau’s Pataca has been tied to Macau’s identity, its independent financial existence and its links to the Lusophone world. Its role as a supporter of the Macau identity relies upon the strength and capabilities of its financial institutions, the Macau Monetary Authority and banking institutions that issue its currency (Banco Nacional Ultramarino and Bank of China). The paper aims to discuss the above issue.

The author uses statistics and data from the Macau Monetary Authority.

There are three possible scenarios that could emerge: first, retired in favor of the RMB, the HK dollar; second, maintained with its use expanding as Macau’s revenues and investment funds grow, or third, become a force for stronger economic cohesion and identity among the Lusophone nations.

Which of these scenarios will offer Macau the highest possibility of maintaining its international network of relationships and representation, diversifying its economy into new growth markets and playing a unique role in China’s twenty-first century destiny?

This paper studies a rarely discussed topic and focuses on a core component of Macau’s existence.

Ethics for many individuals is manifested daily through decisions and actions which display their commitment to personal values. Values permeate our lives, and influence our actions. Managers' decisions and actions should serve as a reflection of their ethics and a mirror for their personal values and beliefs. Therefore, the research question is: does ethics influence how a person performs at work and even where he or she works? If ethics affects where one works, would people with strong ethics gravitate to organizations that match through their policies and behaviors and their own personal, values and beliefs?

The survey was developed through a literature review and multiple iterations among colleagues. It was pretested among faculty, staff, and students in the USA. The US version was administered at a southeastern non‐secular university. The survey was then sent to China for translation. It was administered to an MBA class in China affiliated with the same US non‐secular university. The data were analyzed in SPSS.

A comparison of business executives ensconced in their communities and careers finds ethical behavior and positive values are sought and rewarded in both Chinese and American organizations. And, surprisingly, Chinese business executives believed more strongly than US business executives on all questions which linked economic benefit to organizational climate, productive workforce, and to the existence of strong and positive organizational values and beliefs. US business executives belief that positive ethical practices are rewarded in the short‐ and long‐term, while Chinese business executives believe only in long‐term rewards.

This survey was done at one non‐secular university.

Shared values are critical in cementing lasting business relationships.

The authors believe the study is the first to compare the ethics of American and Chinese managers, or business owners who are well ensconced in their careers and the community within a cross‐section of industries and levels. These successful, highly‐educated professionals represent people who are currently, or may become, top‐level executives. As such, they are an important sample: professionals whose ethics may be guiding their decisions, and because of their work experience, unlike new college graduates, they may have a greater effect on the ethical behavior of organizations through their experience. Recent business scandals prove that the actions of a few have dramatic impact on an organization.

The purpose of this paper is to investigate the effect of revenue diversification, non-interest income and asset diversification on the performance and stability of the Gulf Cooperation Council (GCC) conventional and Islamic banking systems.

The authors implement a panel of 69 conventional and Islamic banks listed in six GCC markets over the period of 2003–2015, using the System Generalized Method of Moments methodology.

Non-interest income diversification has a negative impact on GCC banks’ performance, while asset-based diversification affects banks performance positively. However, Investors tend to penalize the value of the banks’ assets, which are highly diversified. Government intervention, lack of competition, legal protection and high control of Central banks on GCC banks’ have positive impact on performance. Contrary to the results on conventional banks, asset diversification adds value to Islamic banks. Overall, both banks’ revenue and non-interest diversification have negative impact on GCC banks’ stability, while asset diversification improves Islamic banks’ stability.

The analysis is limited to a sample of banks, which are listed in the GCC stock exchanges. The lack of data on private and foreign banks operating in the region made the analysis and, consequently, the results specific to shareholding companies. Also, the authors’ measures of bank stability might not be appropriate to use for Islamic banks, given their banking models implemented.

Research results provide important implications for regulators, bank managers and policy makers, as to the expected ways to support economic diversification through bank diversification strategies.

Unlike related studies, the authors’ sample of homogeneous banks has a market structure that is different from the samples in the literature covering either developed countries or heterogeneous samples from both developed and developing countries. Furthermore, using an efficient econometric methodology, the authors deal with two types of banks: conventional banks and Islamic banks. The research determines which type of bank is more able to benefit from different types of diversification. Unlike previous research, this research explores the sensitivity of the results both to the regulatory environment of the GCC market and to general market conditions.

The study aims to investigate the reasons behind the growing diverse practices of Shariah governance (SG) among Islamic banks in Bangladesh.

Data has been collected through a semi-structured interview process from the concerned authorities (Shariah supervisory board members, Shariah department officers, central bank executives and banking professional experts) related to SG and Islamic banks in Bangladesh. The data has been analyzed by NVivo software.

The results of the study show that SG mechanisms are different due to the lack of unique comprehensive SG guidelines and the absence of a Centralized Shariah Supervisory Board (CSSB) under the Central Bank. The self-developed practices, the diversified opinions and viewpoints of the Board of Directors (BOD), banks' policies, business motivations and profit intention are also responsible for diversified SG practices. The diverse understandings and explanations of Shariah, Madhab (school of thought) and rulings are also responsible for the different practices of SG in Bangladesh.

The study has unique implications for the regulatory authorities and Islamic banks in Bangladesh. The study explored the diverse reasons for numerous applications of SG guidelines which will be beneficial for the central bank and regulators to resolve the issues by outlying unique SG guidelines.

This study outlines the reasons for dissimilar practices of SG by the Islamic banks in Bangladesh, which will be beneficial for Islamic banks and the central bank of Bangladesh.

This study aims to empirically investigate the impact of oil prices, political instability and changes in stability on the bank diversification of the two types of banking systems in the Middle East and North African (MENA) countries.

The study uses bank diversification, stability measurement of probability of default and Zscore by adopting the generalised method of moment for the data between 2007 and 2021. The authors estimate short- and long-run dynamic panel analysis and a robustness test.

The findings reveal that Islamic banks are slightly lower in diversification and stability than conventional peers in the region. Diversification increases with a positive increase in GDP growth, law and order, political stability, bank size, asset quality, oil price, return on equity, profitability and change in banking asset-based stability. The authors found consistency in the two stability measurements in both short- and long-run situations.

Despite the change in banking stability and economic growth and oil prices improved diversification, banks in the region are not diversifying during the crisis period and political instability. Therefore, policymakers should improve mechanisms to monitor the crisis and political unrest to avoid the systemic risk that adversely affects the system through macro-financial linkages in the region.

This study uses change dual stability measurements and oil prices to predict MENA region bank diversification. The authors extended the banking literature by estimating the relationship between crisis periods, political and banking stability, oil prices and other institutional indicators of banking diversification. This study uncovers the effect of the global crisis period on banking diversification and the impact of banking stability changes and validates the models through robustness tests.