Abstract:

Studies on the relationship between Islamic banking activities and the banking sector will contribute to the qualified growth of the finance field. In this paper, it has been evaluated whether the Islamic banking field affects the conventional banking field. The study aims to determine the causality relationship between the variables discussed in the case of Türkiye. Quarterly data for the period 2005:Q1-2022:Q2 were used in the study. A modified version of the Granger causality test proposed by Toda and Yamamoto was used to investigate causality between variables. The study reveals the causality between Islamic banking participation fund and fund disbursement volume and traditional banking deposit volume. The results of the analysis reveal that the deposit and loan volume of Islamic banks is effective on the volume of conventional banks deposits (granger reason), while the volume of conventional banking deposits is also effective on the volume of Islamic banking participation funds (granger reason). This study, on the one hand, reveals the importance of participation banks in terms of the banking sector, and on the other hand, makes an important contribution to the literature in terms of considering the relationship between Islamic banks (participation banks) and conventional banks from a different perspective.

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