Islamic Bank's Profitability Analysis with Dupont Method: Country Cases

Islamic banking is an alternative banking area with an asset volume of approximately 3 trillion dollars today. Its working principles, products and services, balance sheet structure, and pricing behaviors differ from conventional banks. These differences are likely to be reflected in the factors that support the equity profitability of banks. For this reason, this study aims to find common components that support equity profitability through Islamic banking data from 14 countries. The study uses the Dupont method to examine the effectiveness of operational efficiency, asset efficiency, and leverage factors on the profitability of countries. The results show that the different structures of Islamic banks affect the factors supporting profitability performance in the same way across countries.