'Human Resources Management Academic Research Society (HRMARS)'
Abstract
The high debts among Malaysia’s households and the dual banking system in Malaysia motivates this study to investigate the characteristics of the household loan in the conventional and Islamic banking institutions. The loan characteristics are vital as it serves as ‘red flags’ of loan default in the banking institutions. As conventional banks and Islamic banks are under different banking concepts and principles; normally accompanied by
different loan policy and strategies, this study provides insights on the loan characteristics
of the banking institutions. Using the estimated logit model, the results give information on the exposure to risk of default of the banking institutions. The results may be useful in
the formulation of the lending policies of the banking institution