What is it about?

The purpose of this paper is to examine the impact of base lending rate (BLR), consumer prices, gross domestic product, money supply (M3), Karachi stock exchange composite index, KIBOR, and profit rate of Islamic banks on deposits of both conventional and Islamic banks in Pakistan.

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Why is it important?

This study signifies that customers of Islamic banks are motivated by profit. This indicates the normal behavior of customers, hence endures the substitution effect in conventional system.

Perspectives

The study has important implications for Islamic banks to offer more competitive rates of profit with respect to the interest rate of conventional banks in order to collect more deposits. It also identifies relevant policy implication for the central bank of the country.

Dr Waheed Akhter
COMSATS

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This page is a summary of: Determinants of deposits in conventional and Islamic banking: a case of an emerging economy, International Journal of Emerging Markets, April 2017, Emerald,
DOI: 10.1108/ijoem-04-2015-0059.
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