OPTIMIZING ISLAMIC BANK PERFORMANCE FOR UNLOCKING PATH OF PROFITABILITY

Abstract

This study investigated the impact of some investment fund ratios in Islamic banks operating in Syria, represented by both the financing-to-deposits ratio FDR and the resource investment ratio IRR, in addition to the liquidity ratio, on the profitability of these banks, represented by ROA and ROE. In addition, this study aimed to identify the reality of the financial performance of Syrian Islamic banks according to these indicators and clarify the extent to which there are significant differences between them. This was done during the period from 2010 to 2022, based on the annual financial statements published in the annual financial reports issued by the banks under study.  The study found that there were significant differences in the performance of the Syrian Islamic banks studied regarding indicators of fund investment. While the performance of these banks was similar in terms of indicators of profitability and liquidity, there were no significant differences between any of them. The study also concluded that there is a positive and significant effect of FDR and IRR on ROE overall, compared to the absence of any significant effect of these two indicators on ROA. There is no significant effect of the liquidity ratio on ROA or ROE overall.