Heterogeneity of the MENA region's bank stock returns: Does country risk matter?

Mohamed Albaity, Ray Saadaoui Mallek*, Adnan Bakather, Hussein A. Hassan Al-Tamimi

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

4 Scopus citations

Abstract

This study examined the impact of country-risk factors on bank stock returns in the Middle East and North Africa (MENA) region countries. It also investigated whether Islamic banks differed from conventional banks and whether oil rent significantly moderated the risk-returns nexus. Using data from 137 banks from 2011 to 2019 and the 2S-GMM method showed that returns reacted positively to low risk. Islamic banks scored higher returns than conventional banks except with financial risk and democratic accountability, and the risk-returns nexus depended on oil. The results suggested that MENA countries should further enhance political stability and economic resilience and upgrade socioeconomic conditions.

Original languageEnglish
Article number100057
JournalJournal of Open Innovation: Technology, Market, and Complexity
Volume9
Issue number2
DOIs
StatePublished - Jun 2023

Bibliographical note

Publisher Copyright:
© 2023 The Author(s)

Keywords

  • Country-risk
  • Islamic banks
  • MENA
  • Oil rent

ASJC Scopus subject areas

  • Development
  • Sociology and Political Science
  • Economics, Econometrics and Finance (all)

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