Electronic Resource
An Analysis of Islamic Banking Performance: Maqashid Index Implementation in Indonesia and Jordania
Abstract
The discourse on the presence of Islamic banking in the global era went broadly and extensively. It is because the
society has begun realizing the existence of Islamic banking. Islamic banking does able to show its resilience and
endurance facing the global financial crisis. A part from its positive growth, there exist a critical issue related to it
performance measurement. For the time being, the performance measurement of Islamic banking industries merely
uses the financial ratio measurement (shareholder oriented). Indeed, this financial ratio measurement is necessary but
unfortunately not sufficient. Therefore, Islamic banking that is different from conventional banking both in theory and
practice, needs a shifting paradigm in term of their performance measurement which not only limited to the financial
ratios (stakeholders oriented). This paper would like to apply Maqashid Index approach for the measurement of
Islamic banking industry performance. The object of this research is Islamic banking industries in Indonesia (Bank
Syariah Mandiri and Bank Muamalat Indonesia) and Jordan (Jordan Islamic Bank and Islamic International Arab
Bank Jordan)). Using Maqashid Index approach with SAW (Simple Additive The weighting) method, it can be
concluded from the first measurement using Maqashid Index that Islamic banking industries in Indonesia which
represented by BMI (0.17839) and BSM (0.16190) show better performance in comparison with Islamic banking
industries in Jordan, namely IIABJ (0.10295) and JIB (0.08152).
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