Effect Of Financial Crisis On Top Islamic Banks Finance Essay

In this chapter, the research worker is traveling to present the consequences of the determiners of the fiscal public presentation, fiscal stableness and the consequence of fiscal crisis on the top 10 Islamic and the top 10 commercial Bankss over the period 2005-2009. This portion of the thesis will show a elaborate analysis of the fiscal public presentation, fiscal stableness and the consequence of the fiscal crisis on the top 10 commercial Bankss by utilizing different types of the fiscal ratios, such as net net income border, return on equity, return on assets, assets turnover, gaining per portion and geartrain, and it will besides present a elaborate analysis about the fiscal public presentation and stableness of the top 10 Islamic Bankss utilizing the same fiscal ratios used to analyze the commercial Bankss. Following, there will be a ratio comparing between the top 10 Islamic and the top 10 commercial Bankss in order to compare their fiscal place with each other. Furthermore, after the comparing the chapter will show an SPSS analysis on the fiscal ratios of both types of Bankss, in order to sum up the fiscal place in each twelvemonth for both systems and the full period of the survey.

Commercial Banks

During the Period 2005-2006:

The comparative growing in the net net income and gross led to stableness in the NPM of commercial Bankss, where it was about 21.5 % during this period.

The gross increased from $ 458 billion to $ 611 billion and the net net income increased by $ 29 billion, which is tantamount to 29 % growing. Consequently, harmonizing to the difference in the growing, there was somewhat decrease in the NPM from 21.75 % to 21.7 % .

During the period 2006-2007:

During this period, there was a diminution in the NPM by 4.15 % due to the instability in the growing between the gross and the net net income. The gross increased from $ 611 billion to $ 740 billion, and the net net income decreased from $ 129 billion to $ 117 billion ; this fluctuation in the NPM can be seen as a consequence of inefficiency in commanding the fiscal and operating costs. Furthermore, the fiscal crisis strongly affected the market value of the fiscal assets and led to a decrease in the book value of the assets every bit good.

During the Period 2007-2008:

During this period, the NPM decreased dramatically from 17.4 % to -5 % because of the diminution in the entire gross of the commercial Bankss from $ 740 billion to $ 687 billion, which is tantamount to 7 % , and the net net income decreased aggressively from $ 117 billion net income to $ 56 billion net loss, which is tantamount to 148 % . As a consequence, the NPM decreased aggressively due to the consequence of the fiscal crisis on the Bankss. For illustration, Citigroup Bank suffered a loss of $ 32 billion in 2008 and the Royal Bank of Scotland faced $ 50 billion losingss during the same period.

During the Period 2008-2009:

After the impact of the fiscal crisis on the commercial Bankss during the period 2007-2008, these Bankss attempted to counter the fiscal crisis more efficaciously than the old twelvemonth ; this shows in the ability of the commercial Bankss to increase NPM from -5 % to 12.5 % . Although the gross decreased during this period from $ 687 billion to $ 564 billion, with a lessening ratio equal to 18 % , the chief ground for this addition in the NPM was the great growing in net net incomes during the same period, where the net net incomes increased from $ -56 billion to $ 61 billion with a growing ratio of 208 % .

For case, Citigroup Bank reduced its losingss from $ 32 billion to $ 1 billion, while the Royal Bank of Scotland reduced its losingss from $ 50 billion to $ 3.7 billion ; this indicates the high ability of the commercial Bankss to cut down their operational outgos that resulted in an addition in the net net incomes even as the grosss decreased. Furthermore, the authoritiess ‘ aid introduced a large chance for the Bankss to better their fiscal state of affairs ; for case: “ Citigroup received $ 45 billion in Troubled Asset Relief Program ( TARP ) support, including $ 20 billion through the Targeted Investment Program ( TIP ) and $ 25 billion through the Capital Purchase Program ( CPP ) ” ( Congressional, January 2009 ) . Furthermore, “ Royal Bank of Scotland ( RBS ) , Lloyds TSB and HBOS will hold a sum of ?37bn injected into them ” ( BBC, October 2008 ) .

During the Period 2005-2006:

ROE ratio increased from 15 % to 17 % ; this addition was due to the growing in the net net income from $ 100 billion to $ 129 billion, which is around 29 % . In contrast the equity increased from $ 684 billion to $ 825 billion during the same period, which is around 21 % .

During the Period 2006-2007:

During this period, the ROE ratio decreased from 16.6 % to 14 % ; this lessening occurred as a consequence of the growing in equity and lessening in the net net incomes during this period. The equity increased from $ 825 billion to $ 945 billion, which is tantamount to 14 % . In contrast the net net incomes decreased from $ 129 billion to $ 117 billion during the same period, which is tantamount to 9 % .

During the Period 2007-2008:

During this period, there was a crisp lessening in the ROE as a consequence of the impact of the planetary fiscal crisis on the fiscal sector by and large, and on the banking sector in peculiar, which straight affected the grosss and the net net incomes of the commercial Bankss. This indicates the commercial Bankss ‘ low competency in utilizing the available financess from the equity ( stockholders financess and the maintained net incomes ) to bring forth net incomes. By and large, the ROE ratio decreased during this period from 14 % to -5.1 % ; this occurred as a consequence of the great losingss that the commercial Bankss in the sample faced during the fiscal crisis, whereby the net net incomes decreased from $ 117 billion to a net loss of $ 56 billion, with a reduced ratio equal to 148 % and a changeless equity growing ratio of 1 % .

During the Period 2008-2009:

After the impact of the fiscal crisis on the commercial Bankss during the old period, the commercial Bankss attempted to counter the fiscal crisis more efficaciously than the old twelvemonth. This shows in the ability of the commercial Bankss to increase the ROE ratio from -5.1 % to 6.1 % ; the ground for the addition in the ROE ratio was the consequence of the great addition in the net net incomes from – $ 56 billion to $ 61 billion, equal to 208 % , and the equity addition from $ 959 billion to $ 1226 billion, tantamount to 28 % .

During the Period 2005-2006:

During this period the ROA increased somewhat from 0.77 % to 0.82 % due to the addition in the entire assets and an expected increased in the net net income. The entire assets increased from $ 12,999 billion to $ 16,100 billion, which is tantamount to 24 % and the net net income grew from $ 100 billion to $ 129 billion, which is tantamount to a 29 % growing in the net net income.

During the Period 2006-2007:

More interestingly, the net net income decreased from $ 129 billion to $ 117 billion, and the entire assets increased from $ 16,100 billion to $ 22,394 billion ; this instability led to a diminution in the norm of the ROA by 9 % during this period.

During the Period 2007-2008:

The period of the fiscal crisis led to a crisp lessening in investing chances. Therefore, the ROA decreased strongly, whereas the entire assets increased by 8 % but this addition was non used decently to increase the net net income, where the norm of the net net income fell from $ 117 billion to a $ 56 billion loss, equal to a 148 % diminution.

During the Period 2008-2009:

During this period, the norm of the ROA increased dramatically due to the addition in assets of 6 % and the commercial Bankss used these assets decently to bring forth a high per centum of net income, whereby the net net income increased by 208 % . This betterment shows the ability of commercial Bankss to utilize their fiscal assets in order to bring forth net income.

During the Period 2005-2006:

The assets turnover increased during this period from 3.6 % to 3.9 % . This occurred as a consequence of the growing that was accomplished by the top 10 commercial Bankss in footings of grosss, with a ratio higher than the growing in the entire assets. The grosss increased from $ 458 billion to $ 611 billion, with a growing equal to 33 % . At the same clip, the entire assets increased from $ 12,999 billion to $ 16,100 billion during the same period, with growing equal to 24 % .

During the Period 2006-2009:

By and large, the assets turnover declined from 3.9 % to 2.57 % during this period. This indicates that the efficiency of the commercial Bankss in utilizing their fiscal assets to bring forth the grosss decreased ; the ground for that were the entire assets of the commercial Bankss increased from $ 16,100 billion to $ 22,539 billion during this period, tantamount to 40 % , and the gross increased by 9 % .

In other words, the top 10 commercial Bankss increased their fiscal assets during this period by $ 6,439 billion but did non take advantage of this addition in their fiscal assets in an effectual manner to bring forth grosss.

During the period 2005-2007:

The EPS increased from $ 2.34 to $ 4.86 during this period, due to the addition in the net net income from $ 100 billion to $ 117 billion ; this addition indicates the ability of the Bankss to utilize their portion capital in order to increase their stockholders ‘ wealth.

During the period 2007-2008:

The fiscal crisis strongly affected the Bankss ‘ investings, which led to a diminution in the return on the investings and this diminution strongly affected the stockholders ‘ returns, where the EPS decreased from $ 4.86 to – $ 0.89 due to the diminution in the net net income.

During the period 2008-2009:

During this period, many Bankss received fiscal aid from their authoritiess. For illustration, the UK authorities injected ?37 billion into three Bankss in the UK ( BBC, October 2008 ) , and the USA authorities introduced fiscal aid to Citigroup by $ 45 billion through the Troubled Asset Relief Program ( Congressional, January 2009 ) . This support contributed to an betterment in fiscal public presentation, where the net net income increased from – $ 56 billion to $ 61 billion, which led to increase the EPS during this period.

During the period 2005-2006:

There was great stableness in the norm of pitching during this period, which was around 94.8 % . The ground for this stableness is the steady growing between the assets and the liabilities, whereby the norm of the assets increased by 24 % and the norm of the liabilities increased by 24 % .

During the period 2006-2008:

There was increasing in the norm of geartrain of 0.9 % , due to the addition in the norm of support for the assets by loans. However, the entire assets increased by $ 7,986 billion, of which $ 7,852 billion was funded by borrowing, and the remainder was funded through equity ( $ 134 billion ) .

During the period 2008-2009:

After the consequence of the planetary fiscal crisis on the commercial Bankss during 2008, these Bankss attempted to cut down their fiscal and liquidness hazards through cut downing their geartrain ratio ; this is clearly seen through the lessening in the entire assets and liabilities with the addition in equity during this period. Commercial Bankss reduced their entire assets by $ 1,547 billion, equal to 6 % ; the entire liabilities were reduced by $ 1,814 billion, a diminution equal to 8 % ; and there was an addition in equity of $ 267 billion, a growing equal to 28 % .

Muslim Bankss:

During the period 2005-2007:

During this period, there was a monolithic addition in the NPM, where it rose from 34.18 % to 49.78 % . This occurred as a consequence of an addition in the net net income from $ 1,758 to $ 5,259 million, tantamount to 195 % , and the gross increased from $ 4,887 to $ 10,413 million, tantamount to 113 % .

During the period 2007-2008:

The fiscal crisis affected the NPM of the top 10 Islamic Bankss, where the NPM decreased from 49.78 % to 37 % . This diminution was due to the imbalanced growing in the net net income and the entire gross, whereby the entire gross increased from $ 10,413 million to $ 12,558 million, equal to 21 % growing, and the net net income declined from $ 5,259 million to $ 4,666 million, tantamount to 11 % . Therefore, the diminution in the norm of the net net income shows the consequence of the fiscal crisis on the ability of Islamic Bankss to command their administrative and funding outgos.

During the period 2008-2009:

The diminution of the NPM continued during this period, where the entire gross increased by 11 % and the net net income decreased from $ 4,666 million to $ 3,870 million, which is equal to 17 % ; this illustrates that the Islamic banking system did non hold the efficiency to cut down the consequence of the fiscal crisis.

During the period 2005-2007:

The ROE increased from 16.72 % to 24.74 % due to the monolithic growing in the net net income and the entire equity, where the net net income increased from $ 1,758 million to $ 5,259 million and the entire equity increased from $ 12,462 million to $ 23,621 million. This addition indicates the high ability of the Islamic Bankss to utilize their fiscal resorts from equity to bring forth net income, which led to an addition in their stockholders ‘ wealth.

During the period 2007-2009:

More interestingly, the fiscal crisis affected the stockholders ‘ returns, where the entire equity increased by 19 % . In contrast, the norm of the net net income decreased by 26 % , due to the fiscal purchase for the Islamic Bankss, in peculiar in 2008-2009 and, harmonizing to the fiscal purchase theory, any lessening in the gross will take to farther diminution in the net net income ( KORTEWEG, 2010 ) . This lessening in the net net incomes indicates a diminution in the norm of the investings of the Islamic Bankss during this period.

During the period 2005-2007:

During this period, there was an addition in the norm of the ROA, where the ROA increased from 2.37 % to 3.33 % , and this addition was due to the betterment in the norm of the net net income, whereby the net net income increased from $ 1,785 million to $ 5,259 million with a growing rate of 195 % , and the equity increased from $ 12,468 million to $ 23,621 million with a growing rate of 90 % .

During the period 2007-2009:

It is obvious from the ROA ratio the impact of the planetary fiscal crisis on the Islamic Bankss during this period. It is besides obvious through the great lessening of the ROA ratio from 3.33 % to 1.7 % during this period ; this occurred as a consequence of the addition in the entire assets, which was supposed to ensue in an addition in the net net incomes, but really there was a lessening in the net net incomes.

The Islamic Bankss ‘ entire assets increased during this period from $ 151,888 million to $ 205,655 million, with a growing ratio equal to 35 % , while the net net incomes decreased from $ 5,259 million to $ 3,870 million during the same period, with a reduced ratio equal to 26 % .

This indicates that the Islamic Bankss increased their entire assets by 35 % but these Bankss did non take advantage of these new assets to bring forth extra net incomes.

During the period 2005-2006:

The assets turnover of Muslim Bankss increased from 6.26 % to 6.58 % during this period, due to the growing that occurred in the grosss by a higher ratio than the growing in the entire assets during this period, whereby the entire grosss of the Islamic Bankss sample increased from $ 4,887 million to $ 7,508 million, which is equal to 54 % , and the Islamic Bankss ‘ entire assets increased during this period from $ 83,421 million to $ 112,728 million with a growing ratio equal to 35 % .

During the period 2006-2008:

The Islamic Bankss continued to better their competency and used their assets to bring forth grosss ; this is clear through the rise in the ratio of the assets turnover during this period, whereby this ratio increased from 6.58 % to 7.33 % .

During the period 2008-2009:

The assets turnover decreased somewhat, due to the addition in the entire assets being bigger than the addition in gross. In other words, the Islamic Bankss increased their assets, but this addition was non used efficaciously in order to bring forth gross, which led to a lessening in the assets turnover ratio from 7.33 % to 7.21 %

During the period 2005-2007:

During 2005-2007 there was growing in the net incomes per portion due to the monolithic addition in the net net income, whereby the net net income increased from $ 1,785 million to $ 5,259 million, growing of around 195 % , which led to an addition in the EPS from $ 0.67 to $ 1.02 ; this indicates the high ability of the Islamic Bankss to bring forth net income for their stockholders in order to increase their wealth ( disregarding the market portion monetary value ) .

During the period 2007-2009:

The EPS of Islamic Bankss decreased during this period due to the consequence of the fiscal crisis ; the net net income declined from $ 5,259 million to $ 3,870 million, with a reduced ratio equal to 26 % . This diminution in the net net income occurred as a consequence of inefficiency in commanding their fiscal and operating disbursals.

During the period 2005-2008:

The rate of pitching for the Islamic Bankss was increased due to the fact that their new assets were funded strongly by liabilities. Where the entire assets increased by $ 102,007 million, the entire liabilities increased by $ 88,699 million and the equity increased by merely $ 13,308 million ; in general, 87 % of the new assets were financed by liabilities and 13 % were financed by equity, which led to an addition in the fiscal hazard and the fiscal purchase.

During the period 2008-2009:

There was stableness in the geartrain during the fiscal crisis, because the Islamic Bankss tried to cut down their fiscal hazard in order to confront the fiscal crisis, whereby their assets increased by 11 % , their liabilities by 11 % and their equity by 9 % .

Comparison between commercial and Muslim Banks:

The consequences of the net net income border of the two systems illustrate that there was stableness for the two systems in bring forthing net net incomes from the gross during 2005-2006. The Muslim Bankss were more efficient and more stable than commercial Bankss due to the ability of Islamic Bankss to command their fiscal, administrative and operational outgos, and besides the consequence of the fiscal crisis on commercial Bankss was stronger than Muslim Bankss ; this consequence is supported by the consequence found by Ali ( 2010 ) .

In 2009, authorities aid introduced large chances to the commercial Bankss to better their fiscal state of affairs and counter the fiscal crisis ( BBC, October 2008 ) . The mean net net income border of the Islamic Bankss during the period of survey was 26-49 % , and the mean net net income border of the commercial Bankss was -5-21.7 % .

Harmonizing to the above chart, the fiscal public presentation of the Islamic Bankss in utilizing the portion capital and returned net incomes seems to be more good to the stockholders than that of the commercial Bankss. Furthermore, the return on equity of the Islamic Bankss over the period of survey was between 13.79 % and 24.74 % . On the other manus, the return on equity of commercial Bankss was between 16.61 % and -5.13 % .

During the period of the fiscal crisis there was a crisp lessening in the return on equity of commercial Bankss, which strongly affected the stockholders ‘ return ; the consequence on Islamic Bankss was less than on commercial Bankss.

The results of the above chart show that the fiscal public presentation of the Islamic Bankss in utilizing their assets to bring forth net net incomes seems to be stronger than that of commercial Bankss ; the mean ROA for the Islamic Bankss over the period of survey is between 1.72 % and 3.33 % , and for commercial Bankss it is -0.19 % to 0.82 % . These consequences are supported by those found by Johns and Pappas ( 2009 ) .

The fiscal crisis led to a diminution in the book value and the market value of the assets for both banking systems, with a greater rate of diminution for the commercial Bankss than Muslim Bankss.

The norm of the assets turnover of Muslim Bankss to bring forth gross seems to be more effectual than commercial Bankss, whereby the assets turnover of Muslim Bankss ranged from 6.3 % to 7.33 % . In contrast, the norm of the assets turnover of commercial Bankss was between 2.57 % and 3.9 % during the period of survey. Furthermore, in the commercial Bankss, the fiscal investings in the fiscal derived functions led to a decrease of the norm of the gross due to the high rate of hazard in this type of investings. On the other manus, the Islamic banking system focuses on investings with a low rate of hazard.

The above chart indicates that the ability of the commercial Bankss to increase the stockholders ‘ returns was higher than that of Islamic Bankss during 2005-2007 ( disregarding the market portion monetary value ) . However, the consequence of the fiscal crisis in 2008 was stronger on the commercial Bankss compared to the Islamic Bankss, due to the addition in the norm of geartrain and the fiscal purchase during this period, which led to instability in their net incomes. On the other manus, the top 10 Islamic Bankss had more stableness in their net incomes due to the low fiscal purchase and low fiscal hazard for these Bankss. These consequences are supported by those found in THE WORLD ECONOMIC AND FINANCIAL SURVEY ( 2009 ) .

The norm of the geartrain ratio for both systems indicates more stableness for commercial Bankss than Muslim Bankss but the gearing degree for commercial Bankss was higher than Muslim Bankss, and the norm of debt for commercial Bankss was assessed from 94.4 % to 95.7 % . In contrast, it was 80 % to 87.3 % for Muslim Bankss.

The fluctuation in the fiscal state of affairs in the universe has affected the Bankss in different ways. The fluctuation in gross will straight impact the net net income ; in general, if the gross additions by 10 % , this addition may reflect negatively or positively on the net net income due to the fluctuation in the operating and fiscal disbursals ( runing and fiscal purchase ) ( KORTEWEG, 2010 ) .

Consequently, the commercial Bankss had more fiscal purchase, which resulted in the strong consequence of the high fluctuations in the fiscal state of affairs for these Bankss.

Horizontal Analysis

Commercial Banks:

Harmonizing to the above chart, there was an addition in the entire gross of 62 % during 2005-2007 ; but this addition in the gross did non greatly better the net net income, which increased by 17 % merely. Furthermore, during the period of the fiscal crisis there was a diminution in the norm of the gross of 7 % and this led to a lessening in the net net income of 148 % . Furthermore, during 2008-2009 the norm of the gross fell by 18 % and the net net income increased dramatically, where the net losingss increased from – $ 56 billion to go $ 61 billion, tantamount to 208 % growing in the net net income. This addition illustrates the ability of the commercial Bankss to better their investings by commanding their operating and fiscal costs and retrieving their fiscal state of affairs after the effects of the fiscal crisis. On the other manus, the authorities fiscal aids helped the commercial Bankss to better their fiscal public presentation during this period.

The above chart illustrates the fluctuations in the norm of assets, liabilities and equity during the period of survey, where the entire assets increased by 72 % during 2005-2008, there was an addition in the entire liabilities by 74 % during the same period and the entire equity rose by 38 % .

Furthermore, during 2008-2009 there was a lessening in the entire assets of 6 % and a diminution in the entire liabilities of 8 % . In contrast the entire equity rose by 28 % ; this fluctuation shows the ability of commercial Bankss to cut down the consequence of the fiscal crisis by cut downing their entire liabilities and entire assets and increasing their entire equity in order to cut down the fiscal and liquidness hazard.

Muslim Banks:

Harmonizing to the above chart, there was an addition in the norm of the gross by 113 % , where the gross increased from $ 4,887 million to $ 10,413 million during 2005-2007 and the net net income increased by 195 % during the same period. This addition in the gross introduced a good chance for the Islamic Bankss to increase their net net income. Furthermore, during 2007-2009 there was an addition in the gross of 34 % , but the consequence of the fiscal crisis led to cut down the net net income by 26 % , this ensuing from the increasing in their operating and fiscal disbursals.

There was an addition in the entire assets of the Islamic Bankss of 82 % during 2005-2007, the entire liabilities increased by 81 % during the same period, and the entire equity grew by 81 % . However, this addition in the entire assets, liabilities and equity occurred as a consequence of funding 84 % of the assets from the liabilities and 16 % from the equity. Furthermore, during 2007-2009 the entire assets increased by 35 % , the entire liability rose by 38 % and the entire equity increased by 19 % . These additions indicate that Islamic Bankss financed their assets more from their liabilities than their equity, where 91 % of the entire assets were financed by the liabilities and 9 % from the equity.

SPSS

2005

The profitableness ratios ( NPM, ROE and ROA ) illustrate that the Islamic Bankss are more efficient in utilizing their assets and equity to bring forth net income compared to the commercial Bankss ; on the other manus, the commercial Bankss achieved a higher net incomes per portion for their stockholders than Muslim Bankss ( disregarding the market portion monetary value ) . Furthermore, the geartrain ratio shows that the commercial Bankss had more fiscal hazard than Muslim Bankss.

2006

Harmonizing to the consequences of the SPSS analysis, Muslim Bankss were still more efficient in utilizing their assets and equity to bring forth net income ( ROA, ROE ) , while the commercial Bankss were more efficient to accomplish higher EPS for their stockholders ( disregarding the market portion monetary value ) . However, the commercial Bankss still had more fiscal hazard than Muslim Bankss.

2007

The profitableness ratios ( ROE, ROA and NPM ) indicate that the Islamic Bankss were more efficient in utilizing their assets and equity to bring forth net income than the commercial Bankss, with a low rate of fiscal hazard. On the other manus, the commercial Bankss achieved higher EPS for their stockholders than Muslim Bankss ( disregarding the market portion monetary value ) .

2008

The fiscal crisis strongly affected the commercial Bankss, where the consequences of the profitableness ratios appear in negative and demo the monolithic fiscal losingss during this twelvemonth. Furthermore, the fiscal crisis strongly affected the commercial Bankss ‘ stockholders ‘ returns compared to the Islamic Bankss. Finally, the consequences of the SPSS show that the commercial Bankss are more open to fiscal hazard than Muslim Bankss.

2009

Harmonizing to the profitableness ratios, the commercial Bankss improved their fiscal public presentation after the monolithic losingss in 2008, but the Islamic Bankss still had a better fiscal public presentation than the commercial Bankss. Furthermore, the commercial Bankss achieved higher net incomes per portion for their stockholders than Muslim Bankss ( disregarding the market portion monetary value ) , and it besides had more fiscal hazard.

The Summary of SPSS during the period of survey 2005-2009

The consequences of the SPSS indicate that the fiscal public presentation of Islamic Bankss seems to be more efficient than the commercial Bankss. This can be seen by the consequences of the profitableness ratios ( ROA, ROE and NPM ) , whereby the Muslim Bankss were more efficient in utilizing their fiscal assets and equity to bring forth net net incomes compared to the commercial Bankss ( ROA, ROE ) , and the Muslim Bankss were more efficient in utilizing their assets to bring forth gross ( assets turnover ratio ) .

However, the consequences of the stockholders ‘ returns show that the commercial Bankss were more efficient in increasing their stockholders ‘ wealth than the Muslim Bankss ( disregarding the market portion monetary value ) . Furthermore, the commercial Bankss depend on funding their assets by liabilities at a higher rate than equity compared to the Islamic Bankss. Therefore, the commercial Bankss are more open to fiscal hazards than Muslim Bankss, and this is considered the chief ground for the strong consequence of the fiscal crisis on the commercial Bankss compared to the Islamic Bankss. On the other manus, during economic prosperity the commercial Bankss have more chances to accomplish higher net incomes and returns compared to the Islamic Bankss due to their fiscal purchase ( Nielsen, 2010:317 ) .