The effect of the COVID-19 pandemic on profitability performance and maqashid sharia performance in Islamic commercial banks in the ASEAN region
-
Author(s)Kautsar Riza SalmanLink to ORCID Index: https://orcid.org/0000-0001-9463-6429
,
Entis SutisnaLink to ORCID Index: https://orcid.org/0009-0003-1038-6541
,
Jana Siti Nor KhasanahLink to ORCID Index: https://orcid.org/0009-0007-9885-1944
,
Adolf Z.D. SiahayLink to ORCID Index: https://orcid.org/0009-0003-4115-7434
-
DOIhttp://dx.doi.org/10.21511/bbs.19(3).2024.08
-
Article InfoVolume 19 2024, Issue #3, pp. 80-90
- 283 Views
-
94 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
The outbreak of COVID-19 in early 2020 has caused a crisis in various sectors, including the economic sector. In fact, its impact on the performance of Islamic banks in the ASEAN region is currently still unknown. Therefore, this study aims to obtain empirical evidence regarding the effect of COVID-19 on profitability performance and maqashid sharia performance in Islamic banks in the ASEAN region. Profitability performance is measured by return on equity (ROE) and return on assets (ROA). The number of observations from this study was 202 with a sample of 30 Islamic commercial banks in the ASEAN region in 2015–2021. The data analysis technique used is EViews 12. The results show that COVID-19 has no significant effect on profitability performance in Islamic banks, whether measured by ROE or ROA. On the other hand, COVID-19 has a significant effect on reducing the maqashid sharia performance. In addition, company size has been proven to positively affect profitability performance and maqashid sharia performance in Islamic banks before and after the COVID-19 pandemic. Operating expense ratio (OER) has been proven to affect ROE and ROA, whereas FDR and non-performing financing (NPF) have been proven to only affect ROA. OER influences promoting welfare, while FDR and NPF influence establishing justice. The study results confirm the ability of Islamic banks to generate profits amidst the COVID-19 pandemic. They also confirm the negative impact of the COVID-19 pandemic on three aspects of maqashid sharia performance.
- Keywords
-
JEL Classification (Paper profile tab)G21, G34, M21, M41
-
References62
-
Tables10
-
Figures0
-
- Table 1. Study samples by country
- Table 2. Research observations
- Table 3. Hausman test
- Table 4. Lagrange multiplier test
- Table 5. First model
- Table 6. Second model
- Table 7. Third model
- Table 8. Fourth model
- Table 9. Fifth model
- Table 10. Hypothesis testing results
-
- Abdulla, Y., & Ebrahim, Y. (2022). Effect of COVID-19 on the performance of Islamic and conventional GCC banks. Review of Financial Economics, 40(3), 239-258.
- Alhammadi, S., Alotaibi, K. O., & Hakam, D. F. (2020). Analysing Islamic banking ethical performance from Maqāṣid al-Sharī’ah perspective: evidence from Indonesia. Journal of Sustainable Finance and Investment, 12(4), 1171-1193.
- Alnabulsi, K., Kozarević, E., & Hakimi, A. (2022). Assessing the determinants of non-performing loans under financial crisis and health crisis: evidence from the MENA banks. Cogent Economics and Finance, 10(1).
- Alqahtani, F., & Mayes, D. G. (2018). Financial stability of Islamic banking and the global financial crisis: Evidence from the Gulf Cooperation Council. Economic Systems, 42(2), 346-360.
- Alsamhi, M. H., Al-Ofairi, F. A., Farhan, N. H. S., Al-ahdal, W. M., & Siddiqui, A. (2022). Impact of Covid-2019 on firms’ performance: Empirical evidence from India. Cogent Business and Management, 9(1).
- Antonio, M. S., Laela, S. F., & Jazil, T. (2020). Abu Zahrah’S Maqasid Sharia Model as a Performance Measurement System. Jurnal Akuntansi Multiparadigma, 11(3), 519-541.
- Ashraf, B. N. (2020). Stock markets’ reaction to COVID-19: Cases or fatalities? Research in International Business and Finance, 54, 101249.
- Ash-Shiddiqy, M., & Fitriyati, I. D. (2022). Maqasid Syariah and Economic Growth in the Covid-19 Pandemic Era. Proceeding of ICONIE FTIK IAIN Pekalongan, 811-826.
- Asiyah, B. N., Islamiah, C., & Ningrum, C. I. (2022). Analisis Equivalent Rate Perbankan Syariah pada Masa Pandemi (Studi pada Bank BNI Syariah) [Analysis of Sharia Banking Equivalent Rate during the Pandemic (Study on BNI Syariah Bank)]. Al-Intaj: Jurnal Ekonomi Dan Perbankan Syariah, 8(2), 179. (In Indonesian).
- Battaglia, F., & Gallo, A. (2015). Risk governance and Asian bank performance: An empirical investigation over the financial crisis. Emerging Markets Review, 25, 53-68.
- Beck, T., Demirgüç-Kunt, A., & Merrouche, O. (2013). Islamic vs. conventional banking: Business model, efficiency and stability. Journal of Banking & Finance, 37(2), 433-447.
- Boubakri, N., Mirzaei, A., & Saad, M. (2023). Bank lending during the COVID-19 pandemic: A comparison of Islamic and conventional banks. Journal of International Financial Markets, Institutions and Money, 84.
- Caporale, G. M., Lodh, S., & Nandy, M. (2017). The performance of banks in the MENA region during the global financial crisis. Research in International Business and Finance, 42, 583-590.
- Colak, G., & Öztekin, Ö. (2021). The impact of COVID-19 pandemic on bank lending around the world. Journal of Banking & Finance, 133, 106207.
- Dahlan, M., Bustami, M. R., Makmur, & Mas’ulah, S. (2021). The Islamic principle of ḥifẓ al-nafs (protection of life) and COVID-19 in Indonesia: A case study of nurul iman mosque of Bengkulu city. Heliyon, 7(7), e07541.
- Dewi, Y. M., Febriyanto, & Septiana, N. (2022). Analisis Komparatif Kinerja Keuangan Perbankan Syariah Sebelum Dan Saat Pandemi Covid-19: Studi Pada Perbankan Syariah Indonesia Yang Terdaftar OJK [Comparative Analysis of Islamic Banking Financial Performance Before and During the Covid-19 Pandemic: A Study of Indonesian Islamic Banking Registered with OJK]. SNPPM (Seminar Nasional Penelitian Dan Pengabdiankepada Masyarakat), 4, 123-141. (In Indonesian).
- Dietrich, A., & Wanzenried, G. (2014). The determinants of commercial banking profitability in low-, middle-, and high-income countries. The Quarterly Review of Economics and Finance, 54(3), 337-354.
- Dr Maszlee Malik. (2015). Al-Maqasid al-Shari’ah (the Comprehensive Objectives of Shari’a). Penang Institute-G25 Forum “Maqasid Syariah in a Constitutional Democracy”. Bayan Lepas, Pulau Pinang, Malaysia.
- Esen, M. F. (2015). A Statistical Framework on Identification of Maqasid Al-Shariah Variables for Socio-Economic Development Index. Journal of Business Studies Quarterly, 7(1), 18.
- Ghozali, M., Azmi, M. U., & Nugroho, W. (2019). Perkembangan Bank Syariah Di Asia Tenggara: Sebuah Kajian Historis [The Development of Islamic Banking in Southeast Asia: A Historical Study]. Falah: Jurnal Ekonomi Syariah, 4(1), 44. (In Indonesian).
- Grassa, R., Sarea, A., El-Halaby, S., & Damak, A. N. (2022). Between Two Crises: Do Islamic Banks Suffer? Journal of Islamic Monetary Economics and Finance, 8(2), 251-274.
- Haryanto. (2020). Dampak Covid-19 terhadap Pergerakan Nilai Tukar Rupiah dan Indeks Harga Saham Gabungan (IHSG) [The Impact of Covid-19 on the Movement of the Rupiah Exchange Rate and the Combined Stock Price Index (IHSG)]. The Indonesian Journal of Development Planning, 4(2), 151-165. (In Indonesian).
- Hasan, I., Politsidis, P., & Sharma, Z. (2020). Bank lending during the COVID-19 pandemic (MPRA Paper No. 103565). University Library of Munich, Germany.
- Hasibuan, A. A., Zulpahmi, Z., Wahyudin, N., & Nurlaila, A. (2022). The Effect of Financing to Deposit Ratio (FDR), Non-Performing Financing (NPF), Capital Adequacy Ratio (CAR), Operating Expenses and Operating Income (BOPO) On ROA in Islamic Commercial Ban. AL-FALAH: Journal of Islamic Economics, 7(2), 289.
- Jaara, B. O. A., AL-Dahiyat, M. A., & AL-Takryty, I. (2021). The Determinants of Islamic and Conventional Banks Profitability in the GCC Region. International Journal of Financial Research, 12(3), 78.
- Jazil, T., & Syahruddin. (2013). The Performance Measures of Selected Malaysian and Indonesia Islamic Banks based on the Maqasid al-Shari’ah Approach. IJTIHAD, 7(2), 279-301.
- Keliuotyte-Staniuleniene, G., & Kviklis, J. (2022). Stock Market Reactions during Different Phases of the COVID-19 Pandemic: Cases of Italy and Spain. Economies, 10(1).
- Khoiriyah, V. N., & Salman, K. R. (2020). The Effect of the Maqashid Sharia Index, Company Size, and Company Age on Islamic Social Reporting. Muqtasid: Jurnal Ekonomi Dan Perbankan Syariah, 11(2), 117-132.
- Kirimi, P. N., Kariuki, S. N., & Ocharo, K. N. (2022). Ownership structure and financial performance: Evidence from Kenyan commercial banks. PLoS ONE, 17, 1-20.
- Kosmidou, K. (2008). The determinants of banks’ profits in Greece during the period of EU financial integration. Managerial Finance, 34(3), 146-159.
- Luqmanulhakim, L., Rulindo, R., & Anwar, S. (2021). Stability Analysis of Islamic Banking: Indonesia, Malaysia and Pakistan. IQTISHADUNA: Jurnal Ilmiah Ekonomi Kita, 10(1), 125-143.
- Mohammed, M. O., Tarique, K. M., & Islam, R. (2015). Measuring the performance of Islamic banks using maqasid based model. Intellectual Discourse, 23, 401-424.
- Muazaroh, A., & Septiarini, D. F. (2021). Faktor-Faktor Yang Mempengaruhi Tingkat Bagi Hasil Deposito Mudharabah Pada Perbankan Syariah Periode 2015–2020 [Factors Affecting the Level of Mudharabah Deposit Revenue Sharing in Sharia Banking Period 2015–2020]. Jurnal Ekonomi Syariah Teori Dan Terapan – Journal of Theoretical and Applied Sharia Economics, 8(1), 64. (In Indonesian).
- Naceur, S. B., & Omran, M. (2011). The effects of bank regulations, competition, and financial reforms on banks’ performance. Emerging Markets Review, 12(1), 1-20.
- Otoritas Jasa Keuangan (OJK). (2017). Peraturan Otoritas Jasa Keuangan Nomor 47/POJK.03/2017 Tentang Kewajiban Penyediaan Dana Pendidikan dan Pelatihan Untuk Pengembangan Sumber Daya Manusia Bank Syariah [Financial Services Authority Regulation Number 47/POJK.03/2017 Regarding the Obligation to Provide Education and Training Funds for the Development of Syariah Bank Human Resources]. (In Indonesian).
- Pambuko, Z. B., Ichsan, N., & Anto, M. H. (2018). Islamic Banks’ Financial Stability and Its Determinants: a Comparison Study With Conventional Banks in Indonesia. IQTISHADIA, 11(2), 371.
- Pireh, M. (2022). COVID-19 Pandemic and Islamic Social Finance Products in Iran. In Hassan, M. K., Muneeza, A., & Sarea, A. M. (Eds.), Towards a Post-Covid Global Financial System (pp. 243-259). Emerald Publishing Limited.
- Pransiska, P., & Ilmiah, D. (2022). Perbandingan Rasio Kinerja Bank Syariah Terhadap Pertumbuhan Dana Pihak Ketiga Sebelum Dan Masa Pandemi Covid-19 [Comparison of Sharia Bank Performance Ratios to Third Party Fund Growth Before and During the Covid-19 Pandemic]. JPS (Jurnal Perbankan Syariah), 3(2), 160-173. (In Indonesian).
- Rahayu, I. R. S. (2022). Industri Perbankan Syariah Tumbuh “Double Digit” hingga Juli 2022 [Sharia Banking Industry Grows “Double Digit” until July 2022]. (In Indonesian).
- Razak, D. A., Mohamed, M. O., & Taib, F. M. (2008). The Performance Measures of Islamic Banking Based on the Maqasid Framework.
- Rizaty, M. A. (2022). Jumlah Penduduk Muslim Indonesia Terbesar di Dunia pada 2022 [The largest Indonesian Muslim population in the world in 2022]. (In Indonesian).
- Rusydiana, A. S., As-Salafiyah, A., & Mustafa, M. I. (2021). Covid-19, Maqasid Sharia & Islamic Economic Law: VOSviewer Application. International Proceeding: Law and Development in the Era of Pandemic (pp. 47-58).
- Saif-Alyousfi, A. Y. H. (2020). Determinants of bank shareholder value: evidence from GCC countries. International Journal of Managerial Finance, 16(2), 224-252.
- Salman, K. R. (2021). Konsep Dan Praktik Akuntansi Perbankan Syariah: Dilengkapi Kasus Dan Penyelesaian [Sharia Banking Accounting Concepts and Practices: Completed with Cases and Solutions] (1st ed.). Mitra Wacana Media. (In Indonesian).
- Salman, K. R. (2023). Developing of Maqashid Sharia Performance in Islamic Banking. Journal of Islamic Banking and Finance, 40(2), 50-59.
- Salman, K. R., Muslich, A., & Tjaraka, H. (2018). New Evidence On the Direct and Indirect Influence of the Maqashid Sharia Index On the Islamic Social Reporting Index. International Journal of Research Science & Management, 5(8), 165-173.
- Saraswati, H. (2019). Dampak Pandemi Covid-19 Terhadap Pasar Saham Di Indonesia [The Impact of the Covid-19 Pandemic on the Stock Market in Indonesia]. JAD: Jurnal Riset Akuntansi & Keuangan Dewantara – JAD: Dewantara Accounting & Finance Research Journal, 3(2), 153-163. (In Indonesian).
- Sari, H. R., & Canggih, C. (2021). Perbandingan Tingkat Kesehatan Bank Pembiayaan Rakyat Syariah di Pulau Jawa pada Sebelum dan Saat Masa Pandemi [Comparison of the Health Level of Islamic People’s Financing Banks in Java Island Before and During the Pandemic]. MALIA: Journal of Islamic Banking and Finance, 5(2), 133. (In Indonesian).
- Siddiqui, A. (2008). Financial contracts, risk and performance of Islamic banking. Managerial Finance, 34(10), 680-694.
- Sobol, I., Dopierała, Ł., & Wysiński, P. (2023). Is the profitability of Islamic and conventional banks driven by the same factors? A study of banking in the Middle East. In PloS ONE, 18(8).
- Sun, P. H., Mohamad, S., & Ariff, M. (2017). Determinants driving bank performance: A comparison of two types of banks in the OIC. Pacific-Basin Finance Journal, 42, 193-203.
- Sutrisno, B. (2023). Studi Komparatif Tingkat Profitabilitas Perbankan Syariah Dan Konvensional Di Indonesia Selama Pandemi Covid-19 [Comparative Study of Profitability Levels of Islamic and Conventional Banking in Indonesia During the COVID-19 Pandemic]. Taraadin, 3(2), 6976. (In Indonesian).
- Tashkandi, A. A. (2022). Shariah supervision and corporate governance effects on Islamic banks’ performance: evidence from the GCC countries. Journal of Business and Socio-Economic Development, 3(3), 253-264.
- Tho’in, M. (2022). Effect of Financing to Deposit Ratio and Operational Efficiency on Profitability (ROA) with NPF as Intervening in Islamic Banks. Jurnal Ilmiah Ekonomi Islam, 8(2) 2020-2026.
- Trad, N., Rachdi, H., Hakimi, A., & Guesmi, K. (2017a). Banking stability in the MENA region during the global financial crisis and the European sovereign debt debacle. The Journal of Risk Finance, 18(4), 381-397.
- Trad, N., Trabelsi, M. A., & Goux, J. F. (2017b). Risk and profitability of Islamic banks: A religious deception or an alternative solution? European Research on Management and Business Economics, 23(1), 40-45.
- Trisnowati, Y., & Muditomo, A. (2021). COVID-19 and Stock Market Reaction in Indonesia. Journal of Accounting and Investment, 22(1), 23-36.
- Widarjono, A., Salandra, A., Susantun, I., & Ruchba, S. M. (2022). Determinant of Indonesian Islam Bank’s Profitability: Lessons from the BRI Syariah case. Jurnal Ilmiah Ekonomi Islam, 8(03), 3127-3135.
- Widyakto, A., & Wahyudi, S. (2021). Analysis of factors affecting profitability of sharia commercial banks: evidence from Indonesia. Diponegoro International Journal of Business, 4(2), 94-104.
- Yunus Kasim, M., Muslimin, & Dwijaya, I. K. B. (2022). Market reaction to the Covid-19 pandemic: Events study at stocks listed on LQ45 index. Cogent Business and Management, 9(1).
- Zahrah, M. A. (1994). Ushul fiqih (Muntaha Azhari (Ed.)). Pustaka Firdaus.
- Zeitun, R. (2012). Determinants of Islamic and Conventional Banks Performance in GCC Countries Using Panel Data Analysis. Global Economy and Finance Journal, 5(1), 53-72.
-
The impact of COVID-19 on the transportation and logistics industry
Dalia Perkumiene ,
Agbonmere Osamede ,
Regina Andriukaitienė ,
Olegas Beriozovas
doi: http://dx.doi.org/10.21511/ppm.19(4).2021.37
Problems and Perspectives in Management Volume 19, 2021 Issue #4 pp. 458-469 Views: 6536 Downloads: 10195 TO CITE АНОТАЦІЯIn this present age of globalization, the logistics and transportation industry has become an integral part of most businesses/firms as it is aimed at ensuring the effective movement of people, distribution of goods and services from one location to another on time. Therefore, this paper aims to analyze the impact of COVID-19 on the logistics and transportation sectors. The qualitative research approach was adopted using analysis and synthesis of scientific literature, data from news reports, organizational sites, and a case study of data contents. The paper presented the analysis of negative and positive effects of COVID-19 on the logistics and transportation industry. The study also discusses possible strategies and further steps for improvement of the logistics and transportation sector, including the automation and introduction of other technologies, a sustainable and flexible transportation system, cooperation of logistics and transportation business. Findings regarding the positive implications of COVID-19 show noticeable advancements in the logistics and transportation sector, such as the rise of e-commerce businesses with efficient delivery options, and the development of 3rd party logistics services as more companies outsource supply chain operations. The study revealed the importance of strategic planning with a joint effort from the research centers, public sector, private sector, and educational institutions as one of the proposed solutions for the logistics and transportation industry.
-
The impact of social distancing policy on small and medium-sized enterprises (SMEs) in Indonesia
Muhtar Lutfi ,
Pricylia Chintya Dewi Buntuang ,
Yoberth Kornelius ,
Erdiyansyah ,
Bakri Hasanuddin
doi: http://dx.doi.org/10.21511/ppm.18(3).2020.40
Problems and Perspectives in Management Volume 18, 2020 Issue #3 pp. 492-503 Views: 3859 Downloads: 1386 TO CITE АНОТАЦІЯThis study aims to investigate the impact of social distancing policies on SMEs in Indonesia. It used a quantitative method with a survey design. Respondents were all SMEs in Indonesia that are affected by social distancing policies during the COVID-19 pandemic. It involved a total of 587 SME samples selected randomly. The data were collected through observations, questionnaires, and literature studies. The collected data were analyzed using descriptive statistics with SPSS software to determine the mean value. The result showed that social distancing policies affect SMEs during the COVID-19 pandemic. This is indicated by the decreasing income and demand for SMEs products, and even some have no income (mean values of 2.40) due to the social distancing policies. Besides, the policy’s impact is also shown in the increasing cost of raw materials and production costs due to supply chain problems (mean values of 4.79). The policy’s impact raises anxiety for SMEs to survive so that business actors change their plans by utilizing information technology (mean values of 4.81). This change is a strategy to survive due to the impact of the applied policies. Although social distancing policies affect SMEs’ survival during the pandemic, research findings show that SMEs in Indonesia did not terminate employment (mean values of 4.37) due to the presence of economic stimulus policies that helped SMEs survive and grow during the COVID-19 pandemic.
-
Investigating the impact of workplace bullying on employees’ morale, performance and turnover intentions in five-star Egyptian hotel operations
In today’s competitive business environment, human resources are one of the most critical assets particularly for service-focused organizations. Consequently, employees’ morale has become invaluable for maintaining outstanding organizational performance and retaining employees. One of the most important factors which may affect employees’ satisfaction is workplace bullying from employers and colleagues at large. It is considered a negative and unethical issue which may degrade, humiliate and create a risk to a healthy working environment. Therefore, the main objective of this research is to investigate the extent to which workplace bullying may affect the organizational outcomes of a sample of five-star hotels in Egypt. Two questionnaires were distributed among the subjects of the sample; bell desk staff, kitchen stewards and head departments. The results of this research confirmed that there is a correlation between workplace bullying, employees’ morale and turnover intentions but, showed no correlation between workplace bullying and employees’ work performance.
