The Impact of Housing Loan/Financing on Malaysian Bank Risk Performances
Journal: The Journal of Social Sciences Research (Vol.4, No. 6)Publication Date: 2018-12-15
Authors : Mohamad Yazid Isa; Muhammad Arif Fadilah Ishak; Noriza Abd Aziz; Afiruddin Tapa;
Page : 140-144
Keywords : Commercial bank; Islamic bank; House financing; Risk.;
Abstract
This study investigates the impact of housing loan/financing on bank risk performances in Malaysia. The data is collected from 12 commercial banks and 12 Islamic banks in Malaysia within the period of 2002-2016. Non-performing loan (NPL) and loan loss provision (LLP) are used as proxies for bank risk and they are regressed with housing loan/financing, expenses, total loan, income, gross domestic product and inflation. The results from Random and Fixed Effect models show that housing loan/financing has significant impact on the NPL and the LLP of commercial banks and Islamic banks. The results also show that even though commercial banks seem to dominate housing loan/financing market, but Islamic banks are capable to compete with commercial bank in this specific type of financing.
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