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

doi:10.1016/j.joitmc.2023.100057

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

Interdisciplinary Research Center for Finance and Digital Economy

Research output: Contribution to journal › Article › peer-review

9 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 language	English
Article number	100057
Journal	Journal of Open Innovation: Technology, Market, and Complexity
Volume	9
Issue number	2
DOIs	https://doi.org/10.1016/j.joitmc.2023.100057
State	Published - Jun 2023

Bibliographical note

Publisher Copyright:
© 2023 The Author(s)

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 16 Peace, Justice and Strong Institutions

Keywords

Country-risk
Islamic banks
MENA
Oil rent

ASJC Scopus subject areas

Development
Sociology and Political Science
General Economics, Econometrics and Finance

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10.1016/j.joitmc.2023.100057

Cite this

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

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.",

keywords = "Country-risk, Islamic banks, MENA, Oil rent",

author = "Mohamed Albaity and \{Saadaoui Mallek\}, Ray and Adnan Bakather and \{A. Hassan Al-Tamimi\}, Hussein",

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year = "2023",

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doi = "10.1016/j.joitmc.2023.100057",

language = "English",

volume = "9",

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T1 - Heterogeneity of the MENA region's bank stock returns

T2 - Does country risk matter?

AU - Albaity, Mohamed

AU - Saadaoui Mallek, Ray

AU - Bakather, Adnan

AU - A. Hassan Al-Tamimi, Hussein

PY - 2023/6

Y1 - 2023/6

N2 - 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.

AB - 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.

KW - Country-risk

KW - Islamic banks

KW - MENA

KW - Oil rent

UR - https://www.scopus.com/pages/publications/85160234741

U2 - 10.1016/j.joitmc.2023.100057

DO - 10.1016/j.joitmc.2023.100057

M3 - Article

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SN - 2199-8531

VL - 9

JO - Journal of Open Innovation: Technology, Market, and Complexity

JF - Journal of Open Innovation: Technology, Market, and Complexity

IS - 2

M1 - 100057

ER -

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

Abstract

Bibliographical note

UN SDGs

Keywords

ASJC Scopus subject areas

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Cite this