*Linear and Non-Linear Financial Econometrics - Theory and Practice*


#### **Table 7.**

*Coefficientsa,b of the test between Z score and capital adequacy dimension.*


*Excluded Variablesa,b.*


*a Dependent Variable: Z Score.*

*b Linear Regression through the Origin.*

#### **Table 9.** *Test method.*

#### **4.2 Asset quality (AQ) dimension**

Three ratios are examined: Total loans / total assets; Loan Loss Reserve; Non-performing loan to Total loan.

**Table 9** shows test method **(**Variables Entered/Removed method).

**Table 10** shows<sup>3</sup> model summary between Z score and Total Loan to Total Assets, it indicates that Loan to Assets ratio interpret 88% of changes in Z score by positive causal relation = 11.45 point, at significance level 0.0001, see **Tables 11**–**13** indicates that the best ratio can measure Assets Quality is Total Loan to Total Assets. However both provision of non-performing loan to net loans and Non-Performing Loan to Total Loan ratios are excluded because they have high multi collinearity statistics. (They are highly correlated with each other).

**4.3 Management efficiency dimension**

Four ratios are examined including: Cost to Income; Finance Cost /Total Assets;

**In**

Non-Performing Loan /T.Loan .082c 1.226 .224 .147 .688

1 provision of non-performing loan /net loans .030<sup>c</sup> .536 .594 .065 .970

**t Sig. Partial**

**Correlation**

**Collinearity Statistics Tolerance**

**Model R R Square<sup>b</sup> Adjusted R Square Std. Error of the Estimate** 1 .886<sup>a</sup> .786 .783 3.41686937

*Determinants of Islamic Banks Distress in Gulf Council Countries (GCC)*

*For regression through the origin (the no-intercept model), R Square measures the proportion of the variability in the dependent variable about the origin explained by regression. This CANNOT be compared to R Square for models*

**Model Sum of Squares df Mean Square F Sig.** 1 Regression 2956.514 1 2956.514 253.235 .000<sup>c</sup>

*This total sum of squares is not corrected for the constant because the constant is zero for regression through the origin.*

**Model Unstandardized Coefficients Standardized Coefficients t Sig. B Std. Error Beta** 1 T.Loan /T.Assets 11.454 .720 .886 15.913 .000

Residual 805.575 69 11.675

Total 3762.089<sup>d</sup> 70

*Source researcher from data analysis.*

*DOI: http://dx.doi.org/10.5772/intechopen.95028*

*Predictors: Total Loan /Total Assets*

*Source researcher from data analysis.*

*Linear Regression through the Origin*

*Dependent Variable: Z Score*

*Predictors: T.Loan /T.Assets*

*The significance of the model.*

*Source researcher from data analysis.*

*Linear Regression through the Origin.*

*Source researcher from data analysis.*

*Linear Regression through the Origin*

*Predictors in the Model: T.Loan /T.Assets*

*Dependent Variable: Z Score*

*Dependent Variable: Z Score.*

*Table 12 shows that total loan to total assets positively on Z score. <sup>a</sup>*

*Individual effect of independent variables: Coefficients.a,b*

**Model Beta**

*Model Summary between Z score and Assets Quality dimension.*

*which include an intercept.*

*a*

*b*

*a*

*b*

*c*

*d*

*b*

*a*

*b*

*c*

**313**

**Table 13.**

*Excluded Variablesa,b.*

**Table 12.**

**Table 11.**

**Table 10.**

**ANOVAa,b**

ROE. Market price (absolute value is used). The researcher could not find

<sup>3</sup> Loan means Islamic finance portfolio in Assets side of the bank
