This paper documents large cross-country variation in the relationship between bank competition and bank stability and explores market, regulatory and institutional features that can explain this variation. We show that an increase in competition will have a larger impact on banks’ fragility in countries with stricter activity restrictions, lower systemic fragility, better developed stock exchanges, more generous deposit insurance and more effective systems of credit information sharing. The effects are economically large and thus have important repercussions for the current regulatory reform debate.

How different are Islamic banks from conventional banks? Does the recent crisis justify a closer look at the Sharia-compliant business model for banking? When comparing conventional and Islamic banks, controlling for time-variant country-fixed effects, we find few significant differences in business orientation. There is evidence however, that Islamic banks are less cost-effective, but have a higher intermediation ratio, higher asset quality and are better capitalized. We also find large cross-country variation in the differences between conventional and Islamic banks as well as across Islamic banks of different sizes. Furthermore, we find that Islamic banks are better capitalized, have higher asset quality and are less likely to disintermediate during crises. The better stock performance of listed Islamic banks during the recent crisis is also due to their higher capitalization and better asset quality.<br/><br/>Highlights<br/><br/>► We compare conventional and Islamic banks across 22 countries with both bank types. ► Islamic banks are less efficient, but intermediate more, especially during crises. ► During crises, Islamic banks are better capitalized, with lower loan losses. ► Recent stock performance of Islamic banks due to more capital and lower loan losses.

Abstract Using a unique data set for a commercial bank in Albania, we analyze gender differences in loan officers’ performance. Loans screened and monitored by female loan officers have a lower likelihood to turn problematic than loans handled by male loan officers. This effect cannot be explained by borrower or loan officer selection or differences in screening, work load, and experience. However, while the performance gap always exists for female borrowers, female loan officers only gain a performance advantage with male borrowers with experience and do not have an advantage with borrowers that are legal entities. We therefore interpret this as suggestive evidence for female loan officers’ better capacity to build trust relationships with borrowers.