Efficiency and Performance of Islamic and Conventional banks in Pakistan

Abstract

The main object/motif of this research is to find the efficacy and achievement of Islamic banking in comparison of the government and private phrases of the customary banking in Pakistan. This study is based on the data taken from banking sectors of Karachi stock exchange, Official web sites of the bank and Google. In banking Sector three Islamic banks, 3 government banks and 3 private banks have been selected. Here, the statement of the financial-year 2008-2012 year are being used and we are to derive the sequences of the efficiency and achievement of interest - free banking. This research drive that there are no clear differences between interest-free and interest-based banking in view of profitability. The result of this research will portrait the real picture of Islamic banking and it will be a good guide line for the policy makers. The derivations of this research may also be very helpful for the Islamic banks to enable them in developing their performance. This research will pave the way of the decision maker understand the efficiency and performance of Islamic banks. Profitability, Liquidity, Risk and credit Risks are the ratio to gauge the efficiency and performance, the financial statement of the cited banks is the ground on which these ratios are utilized.