Reuieii/ of Islamic Economics, Vol. 8, No. ɪ, 2004
of the banks (p. 360), it would have added force to the logic of his
argument if absolute figures were also provided side by side with the
ratios in his tables or in an appendix. In the absence of such
information, the reliance on ratios alone to draw conclusions makes
little sense: it may indeed be misleading. Table ɪ below illustrates
how mere ratios might be misleading if absolute values are not
simultaneously provided." Notice that in Malaysia the amount of
outstanding property loans from banks rose in every year, while the
rate of growth both rose and fell. Could one read the implications of
the latter phenomenon correctly without knowing the continual rise
in the absolute magnitude of the loans? Policy prescription might be
different if magnitudes were unknown.
Table ɪ: Outstanding Residential Property Loan of Commercial Banks in
Malaysia
|
As at end |
Dec '99⅜ |
Dec 1997 |
Dec t99⅜ |
Dec 1999 |
Dec 2000 |
Dec 2001 |
Dec 2002 |
|
Outstanding Loans |
29.62 |
37-89 |
43-38 |
5O∙36 |
60.98 |
73∙°9 |
83.09 |
|
Growth Rate |
- |
27.92% |
14.49% |
16.09% |
21.09 |
19.85 |
18.24%∙ |
Source: Bank Negara Malaysia Monthly Bulletins.
Note: Figures in RM billion; "Annualized.
The second feature of the work is the use of a sample design that
gave rise to some contradictions. Iqbal informs us that his sample of
IX Islamic banks accounts for more than 75 percent of the aggregate
capital and assets of the private sector Islamic banks and for that
reason, in his view, it constitutes a very large sample from a statistical
viewpoint (p. 360). How the banks were selected and why is not
explained. In any case, it is not what proportion of the aggregate
values the sample banks together cover, but (n) the number of cases
included that makes it large or small in statistical parlance. Thus, n
being 12 in the present case, the sample in the technical sense remains
small. Further, accounting practices, banking laws, and managerial
discretions make the same variable in the sample banks different in
content and import within and between nations. One does not know
if and how the author edited the data to achieve uniformity for
aggregation, especially in the case of cost and profit values, which are