• ISSN: 2301-3567 (Print), 2972-3981 (Online)
    • Abbreviated Title: J. Econ. Bus. Manag.
    • Frequency: Quarterly
    • DOI: 10.18178/JOEBM
    • Editor-in-Chief: Prof. Eunjin Hwang
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HOME > Archive > 2016 > Volume 4 Number 3 (Mar. 2016) >
JOEBM 2016 Vol.4(3): 201-205 ISSN: 2301-3567
DOI: 10.7763/JOEBM.2016.V4.391

Assessing the Determinants of Profitability Performance on Islamic Microfinance in Malaysia

Siti Nurulhuda Ibrahim, Nurul Izzat Kamaruddin, and Shahreena Daud

Abstract— This study able to determine the profitability performance of Islamic Microcredit in Malaysia whereby it focuses on the pioneer of Islamic Microcredit in commercial bank sector in Malaysia (EONCap Islamic Bank) that already been launched since at the end of year 2006. To identify the potential determinants of its profitability, the Least Square Method has been used to examine the relationship between dependent and independent variables and it covering the period from 2006 until 2012. The researcher used five independent variables that possibly can be as determinants of the profitability performance in Islamic Microfinance. The Return on asset is used as dependent variable whereas Cost Efficiency, Capital Ratio, Fuel Price, GNI per capita and GDP deflator as independent variables in a way to measure the profitability performance in this scheme. The result indicated that MFI-Specific and Macroeconomic Environment have positive and negative relationships with profitability performance. The result of the study is valuable for academic, banking and financial institutions.

Index Terms— Islamic microfinance, profitability performance, determinants, commercial bank.

The authors are with the Universiti Teknologi MARA, Bandaraya Melaka, Malaysia (e-mail: sitinur304@bdrmelaka.uitm.edu.my, nrl_izzat@bdrmelaka.uitm.edu.my, shahreena868@melaka.uitm.edu.my).

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Cite: Siti Nurulhuda Ibrahim, Nurul Izzat Kamaruddin, and Shahreena Daud, " Assessing the Determinants of Profitability Performance on Islamic Microfinance in Malaysia," Journal of Economics, Business and Management vol. 4, no. 3, pp. 201-205, 2016.

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