Comparative analysis between islamic and conventional banking in BANGLADESH in accordance to CAMEL rating system analysis

Abstract

As a Muslim country Bangladesh is seen to have a great potential to practice Islamic Finance on the financial sector. People are seen to have an attraction towards the Islamic banks. And the profitability growth of these banks seems to be emerging. Not only in the Middle East, but also the whole global banking now come to terms to understand the value of Islamic Finance. Bangladesh has thirty Banks as of 2018 which seem to rise in 2019. The conventional banks are also seen to make Islamic banking a part of their deposit now for the religious believe of the people as their main factor of profitability is higher deposits. CAMELS rating are the rating system used for banks for evaluation. The six sample banks taken for the purpose of this report are evaluated through eleven ratios. The ratios seem to be in a good position for the banks. Yet at times few banks did not perform according to standard on some cases. While covering the five year evaluation some banks seemed to evolve their position some seem to have a downward moving line. The ultimate result is seen in a way that the banks perform the best in the competitive market. So there should always be competition rather that performing at notch. This competitiveness is a great advantage for the growing economy of the country.