Abstract
This study aimed to measure the impact of distributed profits on the market value of shares in Jordanian Islamic banks. It also sought to identify the criteria for these profits and to measure the factors affecting the market value of shares. Additionally, the study attempted to assess the effect of profit distribution by Islamic banks on market value in the stock exchange. This study falls under the category of descriptive studies, utilizing a survey method on a sample of 150 individuals working in Jordanian Islamic banks, including Safwa Islamic Bank, Jordan Islamic Bank, and Islamic International Arab Bank, using a questionnaire as a research tool. The study arrived at several key findings, notably:
1. Retained earnings are the most important criterion for profit distribution.
2. The inflation rate significantly affects the market value of stocks.
3. There is a statistically significant impact of dividends on the market value of shares in Jordanian Islamic banks.
The study made several recommendations, the most important of which are:
1. Jordanian Islamic banks should periodically conduct studies to understand the factors affecting their market share prices.
2. Jordanian Islamic banks need to determine each share's portion of distributed profits and retained earnings to establish an appropriate distribution policy.
3. The Central Bank should take measures to limit the excessive retention of profits if there are no sufficient justifications for such retention.
Recommended Citation
Osheibat, Sami
(2023)
"The Effect of Islamic Banks' Profit Distribution on the Market Value of Shares in the Secondary Market (Stock Market),"
Jordan Journal of Applied Science-Humanities Series: Vol. 36:
Iss.
2, Article 9.
Available at:
https://digitalcommons.aaru.edu.jo/jjoas-h/vol36/iss2/9