This paper aims to examine how Islamic bank financing responds to monetary policy changes based on bank-specific characteristics in Malaysia's dual banking system. The study uses panel regression analysis of annual financial data from 17 Islamic banks in Malaysia from 2006 to 2012. Exploratory research is conducted to establish how efficiently Islamic banks supply capital to businesses and entrepreneurs, and how their financing responses differ from conventional banks due to differences in profit rates versus interest rates. The conclusions find that bank-specific characteristics significantly impact Islamic bank financing and that challenges remain in further differentiating Islamic banking from conventional banking.

1. BHARATHAN.S
18351018
THE IMPACT OF MONETARY POLICY
ON ISLAMIC BANK FINANCING

2. PURPOSE OR OBJECTIVE
This paper aims to examine the distributional difference of
Islamic bank financing responses to financing rate across
bank specific characteristics in dual banking system.
RESEARCH PROBLEM
It is how efficiently Islamic banks performs their roles as
supplies of capital for business and entrepreneurs.

3. RESEARCH DESIGN
 The study estimates the benchmark model for
Islamic bank financing with respect to bank
characteristics and monetary policy.
 The study uses PANEL REGRESSION
methodology.
 Panel (data) analysis is a statistical method, widely
used in social science, epidemiology, and
econometrics to analyze two-dimensional (typically
cross sectional and longitudinal) panel data.
 The data are usually collected over time and over
the same individuals and then a regression is run
over these two dimensions.

4. TYPE OF RESEARCH
 Exploratory research is conducted for this study.
 That has not been studied more clearly, intended to
establish priorities, develop operational definitions
and improve the final research design.
 Exploratory helps to determine the best research
design, data-collection method and selection of
subjects.

5. SAMPLE DESIGN
TARGET POPULATION
 Commercial banks
 Islamic bank
 Investment bank
SAMPLING ELEMENT
 Totel assets:
SAMPLE TOOL
 Statistical tool used for the study.
TIME
 2006-2012
SAMPLE UNIT
 Islamic and conventional banks

6. DATAAND ESTIMATION
METHODOLOGY
 The study used primary data.
 The study uses a panel of annual bank
level data of all Islamic banks operating
in the Malaysia covering the period
2006-2012.
 The financial statements are collected
from the bank scope database of bureau
van Dijik company.
 Using the panel information of 17
individual banks, we initially estimate the
benchmark model for Islamic bank

7. REVIEW LITERATURE
 Islamic banking is different from conventional
banking from theoretical perspective because
interest.
 In the conventional literature, the interest rate
has long been recognised not only by
classical and also neo classical economist.
 Recent literature on Islamic finance also try to
establish the difference between Islamic rate
of returns and conventional bank rate of
interest

8. conclusion
 The study have explored the bank lending behaviour
for the conventional banks for the past lending.
 This paper analyses the importance for bank specific
characteristics with respect to Islamic bank
financing.
 Many problems and challenges relating to Islamic
instruments, financial market and regulation must be
addressed and resloved.
 The functioning of Islamic banks should rapidly
differentiate itself from conventional banking.