Professor Omneya Abdelsalam o.h.abdelsalam@durham.ac.uk
Professor
New Insights into Bank Asset Securitization: The Impact of Religiosity
Abdelsalam, Omneya; Elnahass, Marwa; Batten, Jonathan A.; Mollah, Sabur
Authors
Marwa Elnahass
Jonathan A. Batten
Sabur Mollah
Abstract
We examine the influence of both organizational and geographical religiosity, as important ethical parameters moderating a bank’s decision to securitize their assets. The study employs a unique database of banks located within countries marked by high (low) religious adherence. Our results provide evidence that different measures of religiosity affect a bank’s decision to securitize their assets: Banks located in countries with high religious adherence are less likely to engage with securitization compared to banks in countries with lower religiosity, while Islamic banks have a higher likelihood of embarking on a highly monitored model of asset securitization in contrast to conventional banks. When examining the motives underlying a bank’s decision to securitize assets, there is strong evidence that Islamic banks securitize their assets to improve their portfolio diversification, financial performance, and regulatory compliance. This study highlights the importance of considering informal ethical mechanisms, such as religiosity, at both the country and firm levels, when studying bank risk-taking and trading decisions, especially in countries with dual banking systems.
Citation
Abdelsalam, O., Elnahass, M., Batten, J. A., & Mollah, S. (2021). New Insights into Bank Asset Securitization: The Impact of Religiosity. Journal of Financial Stability, 54, Article 100854. https://doi.org/10.1016/j.jfs.2021.100854
Journal Article Type | Article |
---|---|
Acceptance Date | Feb 18, 2021 |
Online Publication Date | Feb 25, 2021 |
Publication Date | 2021-06 |
Deposit Date | Dec 15, 2020 |
Publicly Available Date | Mar 29, 2024 |
Journal | Journal of Financial Stability |
Print ISSN | 1572-3089 |
Publisher | Elsevier |
Peer Reviewed | Peer Reviewed |
Volume | 54 |
Article Number | 100854 |
DOI | https://doi.org/10.1016/j.jfs.2021.100854 |
Public URL | https://durham-repository.worktribe.com/output/1255358 |
Files
Accepted Journal Article
(1.5 Mb)
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Publisher Licence URL
http://creativecommons.org/licenses/by-nc-nd/4.0/
Copyright Statement
© 2021 This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/
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