The impact of capital structure and economic uncertainty on banks performance in the MENA region: do Islamic banks differ from conventional?

Purpose This paper examined the impact of capital structure (DR) and uncertainty (WUI) on bank performance in the Middle East and North Africa (MENA) region. In addition, it examined whether Islamic banks’ performance differed from conventional banks. Design/methodology/approach The study’s secondary data consist of 258 conventional and Islamic banks from 2010 to 2022 in 14 MENA countries. A generalized quantile regression estimator was applied to meet the study’s objectives. Findings The study revealed that capital structure and uncertainty negatively and significantly impacted bank performance. Islamic banks underperformed conventional banks. Originality/value This study will fill in the existing gap in the literature by providing insights into the impact of capital structure and economic uncertainty on bank performance in the MENA region. This is one of the few studies examining uncertainty’s impact on bank performance in the MENA region.