Empirical Analysis Of Islamic Bank Operating Stability

Islamic finance is a unique differentiated forms of finance which is in line with the teachings of Islam and reconciled the principles of modern finance. This paper based on the theoretical analysis of Islamic banking operations of robustness, takes a further test for the relevant conclusions, using the empirical methods. Combined with the related financial development theory and the development trends of global Islamic trends, this paper also explores the Islamic finance's specific development path in China.The modern form of Islamic finance is inextricably linked with religion, the essence of modern Islamic banking and Islamic religion of modern financial integration of the product. Generally, Islamic finance has bindings of religious, moral, and non-speculative three distinct characteristics, such characteristics make Islamic bank a strong anti-risk ability. The using of panel models tested for the above conclusions, empirical results demonstrated the above point of view, results showed that: Islamic banks operated a more stability than traditional banks. Among them, the small Islamic banks will have a more stability than the small traditional banks, while the large-scale operation of Islamic banks will have a less robustness than the mean of large-scale conventional banks. The avoiding of the interest-based lending operations, to a certain extent, has a positive impact to the stability of the Islamic banking. Islamic bank's operational status depends on the size of the bank to judge. The liquidity indicators measured by liquidity ratio have a significant effect to all samples and heterogeneity samples . A country's macroeconomic conditions have no obvious effect for the robustness of the Islamic banks.China should relies on "eastward" trend of Islamic finance, strengthening co-operation with the Islamic finance, Islamic financial institutions as well as to attract Middle East oil dollar investment. In the path selection, the financial authorities could consider to make a good use of overseas investment in Hong Kong as an important springboard into the Mainland of China t, building some relevant experience. In China's inland areas, government could consider to the issue of moderate Islamic financial products in the Islamic populated areas, or conduct some form of cooperation with foreign Islamic financial institutions. At the same time, China should pay attention to a series of questions such as the building rules and regulations, institutional coordination, talent introduction, product development.