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The aim of this paper has twofold: (1) to explain and compare the financial evolution of Islamic and conventional banking sector in the Gulf Cooperative Council (GCC) countries before and during the COVID-19 pandemic and (2) to explore the key success factors that might affect Islamic and conventional banks performance before and mainly during COVID-19 pandemic period.

Orbis Bank Focus database and annual financial reports are used to collect financial information of Islamic and conventional banks in GCC countries over four years: 2017, 2018, 2019 and 2020. Descriptive statistics, T-test, multiple regression, and 2SLS and GMM models are employed to analyze the financial structure and performance of Islamic and conventional banks before and during the COVID-19 pandemic period.

Results of this study reveal that (1) there is a significant difference between Islamic banks and conventional banks during the crisis of COVID-19, where the conventional banks have presented a higher level of financial performance and financial liquidity than their Islamic counterparts, (2) conventional banks have revealed higher capacity to manage their financial risk during the crisis period, and (3) a high level of non-performing loan, high inflation rate and high percentage of non-important cost have a negative impact on the financial performance of Islamic banks mainly during the pandemic period of COVID-19. However, the result indicates that a high level of liquidity risk increased the performance of Islamic banks but this impact falls sharply during the pandemic period.

This study provides information that supports investors, regulators and executive managers in GCC countries. A well-structured balance sheet would improve the financial performance and risk management of the banking sector in GCC countries, especially in times of crisis and pandemics.

This study aims to construct comprehensive index of Tahfiz empowerment taking into account various factors such as social, intellectual, physical and religious, as well as economical. According to Maqasid Shariah, Malaysia has to establish a Tahfiz Empowerment Index (TEI) for the implementation of National Tahfiz Education Policy (NTEP) to ensure that Tahfiz institutions assist students’ development in a productive and meaningful way consistent with Islamic values and national educational objectives.

This study proposes the TEI using Maqasid Shariah to offer an organized framework for evaluating and improving the quality and social relevance of Tahfiz institutions. The TEI weaves the five fundamental aims of Maqasid Shariah – preserving religion, protecting life, fostering intellect, preserving lineage and ensuring economic sustainability – into measurable indicators. Comprehensive review of the literature supports the TEI and its using experts, and the TEI assigns equal weightage to each dimension and has provisions to address biases.

The TEI consists of five fundamental aspects: preservation of religion, life, intellect, lineage and economic sustainability. The results imply that systematic way of evaluating and enhancing performance of Tahfiz institution is crucial as the study proves the institution’s importance in the development of its students.

The TEI provides a systematic framework to be used in future empirical research that searches for the operation of Tahfiz institutions and their outcome. Moreover, it serves as a theoretical basis for further research on Islamic education and its alignment with Maqasid Shariah. It also propounds a holistic and inclusive approach encompassing improvement in educational possibilities.

The TEI has useful managerial and policy implications for the improvement of Tahfiz institutions. It can be used as a benchmark whenever the policymaker is in doubt about the quality, safety and equitable distribution of resources in education to achieve Malaysia’s NTEP objectives. The TEI also provides practical, tangible performance indicators for evaluation and benchmarking, resource allocation and strategy planning. It integrates Maqasid Shariah principles, focusing on areas like spiritual and intellectual development, economic sustainability and community engagement.

The TEI as part of Sustainable Development Goals 2030 contributes to social benefits: integrating the principles of Islamic education and human dignity and social welfare. It erases the existing gaps by providing the necessary means through such practices as offering vocational training to underprivileged students, contributes to social responsibility by enhancing mental health and encouraging services to the community, and ultimately improves community involvement through volunteerism and collaborations. Also, TEI directs the distribution of funds toward programs that should benefit underprivileged learners, thus maintain sustainable fund allocation as well as promoting social responsibility as per NTEP objectives.

This study presents a novel index grounded on Maqasid Shariah which is useful for assessing and improving the Tahfiz institutions. It gives a definite and systematic method of evaluating these institutions’ degrees of empowerments to meet all the diverse roles they play in the society.