Measuring The Effect Of The Financial Leverage On The Market Value Of The Shares Of The Islamic Banks Compared To The Conventional Banks

Abstract

This study aims at measuring the effect of the financial leverage on the market value of the shares of the Islamic banks (the Saudi stockmarket) compared to the conventional ones in Jordan. The study was conducted on two banks from 2010 to 2021 using the Ordinary Least Squares OLS based on the annual financial reports of the two banks. Findings show that there is no effect for the financial leverage on the market value in the Saudi banks because the Saudi stock market is an Islamic one that does not use the interest rates. On the other hand, there is an effect for the financial leverage on the market value of the shares in the Jordanian commercial banks.

JEL:G0,G1