The Measurement of Islamic Bank Performance: A Study using Maqasid Index and Profitability

THE FINANCIAL HEALTH AND SOCIAL PERFORMANCE (Case Study: Comparison between Conventional and Islamic Banking in Indonesia)

Abstract

            Islamic banking is a financial institutions carry out its business activities in line with the basic principles of Islamic economy. Islamic economic goals for Islamic banks are not only focused on commercial purposes but also consider its role in providing welfare broadly to society. The emergence of Islamic banks seems the more affirming that the conventional bank does not have a social role. In fact, the bank is generally held to be managing the funds of the society. Certainly, the society also expected reciprocities form banks. Therefore the measurement needs to be done to compare Islamic banks and conventional banks. This research aims to quantify and compare the financial health and social performance of conventional banks and Islamic banks by using the ratio of the elements provided financial reports and data provided by Bank Indonesia.

THE PERFORMANCE OF FOUR BANKS IN INDONESIA BASED ON MAQOSID INDEXAND PROFITABILITY IN 2012 (COMPARATIVE STUDY OF ISLAMIC AND CONVENTIONAL BANKING)

Abstract

The financial performance does not reflect the overall performance of a bank, primarily public interest objectives. Aspect of Maqosid sharia should be applied to achieve Mashlahah in addition to financial performance of banks (economic performance), but also be seen from the aspects maqasid sharia.

This study aims to analyze the performance of banks in Indonesia in terms of aspects of maqasid sharia using the MaqasidShariah Index (MSI) approach and bank profitabilities by comparing (PER, ROA and ROE) in 2012. Object of study is four Banks in Indonesia, among others: Bank Muamalat Indonesia (BMI), Bank SyariahMandiri (BSM), Bank Central Asia (BCA), and Bank Mandiri.

The results showedthatperformance measurementcan be donewith model of maqasidsharia Index(MSI) andprofitabilityapproachformeasuringthe financialperformanceand we are able to know therankofthe four banksfrom both of them (MSI and Profitability approach).

Key Word: Banking, MaqosidSyariah, Profitability

An Economic Islamicity Index

Aam S. Rusydiana

Abstract

There are many factors in determining economic growth as well as an explanation of the success of economic performance that not only includes political and social forces. In particular there has been attention to the role of religion in the economics, with a number of economists that explored the relationship between religion and economic performance. This paper aims to measure how Islamic countries, which declared their country as an Islamic State or Islamic majority adherents, or as a member of the Organization of Islamic Confederation (OIC) which is part of the ASEAN? Are these countries run on Islamic economic principles? To measure Economic IslamicityIndex ASEAN countries, we use 10 indicators Economic Islamicity Index represented by 10 representatives based on the Islamic principles in economic.

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[1] Islamic Economic Science Department of Tazkia University College of Islamic Economic, Bogor 16810, Indonesia.