By Syed Farhan Najum & Irfan Anjum Manarvi
ABSTRACT
International financial institutions especially the banks were seriously hit by the global recession and the period after it. A large number of conventional and Islamic banks were operating in Pakistan at that time, though with slightly different practices and strategies. This research was focused on analyzing their performance during and after the recession period. Financial ratios such as advanced deposit ratio return on investment, debit to equity, current and working capital ratios were considered appropriate tools to carry out this analysis. Data from published yearly reports of various conventional and Islamic banks such as Bank Al Habib, Alfalah, Islami, Muslim Commercial and Meezan bank was collected and analyzed by evaluating these ratios for each bank. A comparative analysis was also carried out through time series during the period from 2006 to 2011. Both the types of banks were found to be hit by the recession, however the effect on Islamic banks was observed lower than the conventional bank. A review of the history of a bank’s operations showed that those with longer operational period performed better than the new entrants in Pakistani market.
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