Housing loans reduce bank risks, Islamic banks compete with commercial.
The study looked at how housing loans impact bank risk in Malaysia's dual banking system. They analyzed data from 2002 to 2016 from commercial and Islamic banks. The results showed that housing loans have a significant and positive impact on reducing non-performing loans and loan loss provisions. This means that housing loans are a low-risk investment for banks because they are backed by mortgages, making them a valuable asset for banks.