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http://www.ijbsr.org/images/archive_articles/April2013/9.pdf



*Testing the Financial Stability of Banks in GCC Countries: Pre and Post
Financial Crisis *



*ABSTRACT*

Stability of the banking system is underpinned through an effective bank
monitoring mechanism since the sector is resilient to a range of single and
combined shocks. Banks financial stability in the Gulf Cooperation Council
(GCC) countries was empirically assessed by using z-score as a dependent
variable. A group of macro and microeconomic independent variables were
selected to measure their effects on banks stability. All banks in this
region that are considered Conventional or Islamic banks were selected. The
targeted period was 2003-2010 to cover pre- and post- financial crisis. It
was found that there is no evidence that there is a significant difference
between the financial stability of Conventional and Islamic banks for the
periods 2003-2010, 2003-2007, and 2008-2010. However, Conventional banks
tend to be financially stronger than Islamic banks for the pre- financial
crisis.



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