The impact of oil price crisis on financial performance of commercial banks in Bahrain

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Oil export is the major source of revenue for the countries in the Middle East. Their economies are sensitive to fluctuations in oil prices. The present study examines the impact of oil crisis on the performance of selected banks of Kingdom of Bahrain using profitability, efficiency, capital adequacy and liquidity ratios in the pre-crisis and crisis periods. The study reveals that there is no significant difference in the performance of banks in the pre-crisis and crisis period. The results indicate that there is a significant difference in the performance of conventional banks and Islamic banks in the pre-crisis period. However, there is no significant difference in the performance of conventional banks and Islamic banks during the crisis period.

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    • Figure 1. Crude oil price per barrel in US dollar
    • Table 1. Performance of banks (pre-crisis) – descriptive statistics of variables
    • Table 2. Performance of banks (during crisis) – descriptive statistics of variables
    • Table 3. Comparative performance – pre crisis and during crisis
    • Table 4. Single factor ANOVA on all the banks
    • Table 5. Single factor ANOVA on conventional & Islamic banks
    • Table 6. Result of t-test (all banks)
    • Table 7. T-test on conventional & Islamic banks