### Banking assets and return

The coefficients for the SEM path between financial assets and return (estimated standardized *β* coefficient = − .65, with *p* = .003) in final model provide strong significant support for H_{1}.

###
**H**
_{
1
}

There is a significant relationship between the volatility of Islamic banking assets and return (*R*).

This implied that the volatility of Islamic financial institutions return has a direct effect on the growth of financial assets of Islamic financial institutions. Thus, higher is the profitability of financial institutions, the lower the growth of assets (− .65) of financial assets. This may have implied that efficiency of return is not only the only factor of asset development. However, specific geographical or territorial factors influence the asset.

These results strengthen the conceptual theories of the literature. It is consistent with the findings of [40, 58]. These results also validate that regardless of religious factors as stressed in Islamic finance literature, the efficiency of macroeconomic factors is also important to boost the growth of Islamic financial system. This also implied that bigger share of the overall industry likewise implies more strength to the bank of controlling the costs and benefits it offers to keep customers [28].

Moreover, this finding also elaborates that institutional effort for measures of increase profitability can strengthen the size of the institution as well. Thus, these results empirically proved the relationship of return and asset to influence the outward operations of the institutions.

### Banking assets and population

The coefficients for the SEM path between financial assets and population (estimated standardized *β* coefficient .48), with non-significant value *p* = .76, did not support the hypothesis H_{2.}

###
**H**
_{
2
}

Muslim population (*P*) has a direct effect on Islamic banking assets.

The result of final model for the relationship between asset and population is not according to expectations. This implied that the percentage of Muslims in a particular geographical area has no impact on increasing the size of Islamic financial institutions.

The research study strengthens the conceptual theories of the literature related to the relationship between assets and population. These findings are consistent with [22], that analyzes the effect of religion on Islamic Finance. The study observed that Muslims belittled Islamic banks in view of the religious variable, as well as more due to the profits, got from investments. These results also validate that regardless of religious factors, the efficiency of other factors of growth are important to boost the growth of Islamic financial system.

However, these findings are inconsistent with the finding of [4], who considered to religious factor as an important factor to attract Muslim investors and increase the institutional size.

### Banking assets and time interval

The beta coefficients for the SEM path between variables of financial assets and time interval (estimated standardized *β* coefficient − .15), with non-significant value *p* = .924, did not support the hypothesis H_{3.}

###
**H**
_{
3
}

Time interval (*T*) has a direct effect on Islamic banking assets.

The result of final model for the relationship between asset and time interval is quite unique. This implied that the matter of time on Islamic institutions has no impact on increasing and decreasing the size of assets of Islamic financial institutions.

The research study strengthens the already studied conceptual theories of the literature related to the relationship between assets and time interval that considered management expertise and other variables as an important factor to increase the share of Islamic finance in the financial system. These empirical research findings also impact the confidence of investors. So far, this study signifies the invaluable relationship of time and asset. The sample characteristics and complexity of SEM model to measure the variables may be a cause of such findings [55].

These results also validate that instead of time factors, efficiency and effectiveness of other factors of growth are important to boost the growth of Islamic financial system.

However, these findings are inconsistent with the finding of [21], who considered to the passage of time as a meaningful variable to get deep insight into determinants of growth of financial indicators and increase the institutional size. Moreover, SEM model specifies the direct significant relationship between time and growth with a significance value of *p* = .02. This finding rejects the mediating role of products and services to strengthen the relationship between time and growth of IF.

### Banking assets and GDP rate

Gross domestic product (GDP) and economic development are usually related to defining financial premises. A huge amount of literature discussed the relationship between an increase in the percentage of bank deposits to GDP [10, 24, 47, 48, 59]. Moreover, SEM model specifies the direct significant relationship between GDP and growth with a significance value of *p* = .000.

However, the hypothesized relationship between asset and GDP (estimated standardized *β* coefficient .39), of this study is not significant at a level of .05. The findings of SEM model did not support the H_{4}. This finding rejects the mediating role of products and services to strengthen the relationship between GDP and growth of IF.

###
**H**
_{
4
}

GDP (D) has a direct effect on Islamic banking assets.

The result of final model for the relationship between asset and GDP is also quite unique. This implied that the external environment factor, GDP, has no impact on increasing and decreasing the size of assets of Islamic financial institutions.

The research study did not strengthen the already studied conceptual theories of the literature related to the relationship between assets and GDP. The study implied that economic indicators have a no influence on investors’ confidence and development of assets.

These results also validate that instead of GDP, efficiency and effectiveness of other factors of growth need to be evaluated to study their impact on assets of IFIs. Moreover, SEM model specifies the direct significant relationship between GDP and growth with a significance value of *p* = .05. This finding rejects the mediating role of products and services to strengthen the relationship between time and growth of IF.

### Islamic equity fund and return

The coefficients for the SEM path between IEF and return (estimated standardized *β* coefficient .50, with *p* = .02) in final model provide strong significant support for H_{5}.

###
**H**
_{
5
}

There is a significant relationship between the volatility of NAV of Islamic equity funds and return (*R*).

This implied that the volatility of Islamic financial institutions return has a direct effect on the growth of IEF sector. Thus, higher is the profitability of Islamic financial institutions, the greater the value of IEF. One percent increase in return leads to .50% increase in the value of IEF. This may have implied that efficiency of return is an important factor of IEF development.

These results strengthen the previous conceptual theories of the literature built by many authors. Many authors including [37, 46] concluded positive results towards the performance of Islamic equity fund [37, 45]. These results also validate that regardless of external factors, the efficiency of internal factors are also important to boost the growth of financial assets. This also implied that bigger size of the overall industry likewise implies more strength to the specific sector of an industry. However, these finding opposed to Bashir and Nawang [10] that contend the negative performance of IEF.

This finding also elaborates that industrial effort for measures of increase profitability can strengthen the size of the institution as well. These results empirically proved the relationship of return and IEF to influence the outward operations of the institutions. Moreover, these finding shows the confidence of Islamic finance investors towards IEF.

### Islamic equity fund and population

The coefficients for the SEM path between IEF and population (estimated standardized *β* coefficient − .57), with non-significant value *p* = .735, did not support the hypothesis H_{6}.

###
**H**
_{
6
}

Population (*P*) has a direct effect on NAV of Islamic equity funds.

The result of final model for the relationship between IEF and population is not according to expectations. Again, this implied that the percentage of Muslims in a particular geographical area has no impact on increasing the size of IEF. This inferred the importance of creating awareness about Islamic products and services to people of Pakistan [48].

The research study strengthens the conceptual theories of the literature related to the relationship between IEF and population. Again, these findings are consistent with Erol and El-Bdour [22], that analyzes the effect of religion on investment in Islamic products and services [22].

However, these findings are inconsistent with the finding [6], the researcher contends that the growing population of Muslims in a world is considered an important force behind establishment and growth of Islamic finance products and services [6, 33].

These results also validate that regardless of religious belief factors, the efficiency of other factors of growth are important to boost the growth of Islamic products and services in Pakistan.

### Islamic equity fund and time interval

The beta coefficients for the SEM path between variables of IEF and time interval (estimated standardized *β* coefficient 1), with non-significant value *p* = .533, did not support the hypothesis H_{3}.

###
**H**
_{
7
}

Time interval (*T*) has a direct effect on NAV of Islamic equity funds.

The result of a modified model for the relationship between IEF and time interval is not according to expectations. This implied that the matter of time on Islamic institutions have no impact on increasing and decreasing the size of investment of IEF.

These findings are inconsistent with the finding of Elfakhani et al. [21], who considered to the passage of time as a meaningful variable to get deep insight into determinants of growth of financial products and services [21]. Moreover, SEM model specifies the direct significant relationship between time and growth with a significance value of *p* = .02. This finding rejects the mediating role of IEF to strengthen the relationship between time and growth of IFIs.

These empirical research findings also revealed the confidence of investors. Research finding indicates that investors have no confidence on IEF. So far, this study signifies the invaluable relationship of time and IEF. These results also validate that instead of time factors, efficiency and effectiveness of other factors might have an impact on the growth of Islamic equity funds.

However, results of bivariate correlation implied a significant relationship between IEF and return with a *p* value of .04. While the beta coefficient of .620 presented a positive relationship between the variables, i.e., increase in return lead to increase in investments in IEF. These results also validate that instead of time factors, efficiency and effectiveness of other factors of might have an impact on the growth of Islamic equity funds.

### Islamic equity fund and GDP rate

As depicted in Table 7, the hypothesized relationship between IEF and GDP (estimated standardized *β* coefficient = − .28) of this study is not significant at a level of .05 with a *p* value of .22. The findings of SEM model did not support the H_{8}.

###
**H**
_{
8
}

GDP (D) has a direct effect on NAV of Islamic equity funds.

The result of final model for the relationship between IEF and GDP is unexpected. This implied that the external environment factor, GDP, have no impact on increasing and decreasing the size of investment in Islamic equity fund.

The research study did not strengthen the already studied conceptual theories of the literature including Nguena [49] that is related to the relationship between Islamic products and GDP [49]. The study implied that GDP, an economic indicator of growth, has a no influence on investors’ confidence and development of IEF. Moreover, SEM model specifies the direct significant relationship between GDP and growth with a significance value of *p* = .05. This finding rejects the mediating role of IEF to strengthen the relationship between time and growth of IF.

However, this research finding is consistent with Johnson [36] that refused the impact of GDP on the growth of Islamic financial products and services [36, 37].

These results also validate that instead of GDP, efficiency and effectiveness of other macroeconomic factors of growth need to be evaluated to study their impact on the growth of Islamic financial system.

### Islamic equity fund and growth of Islamic finance

The coefficients for the SEM path between financial assets and growth variable of IF (estimated standardized *β* coefficient .453, with *p* = .002) in final model provide strong significant support for H_{9}.

###
**H**
_{
9
}

NAV of Islamic equity funds has a direct effect on the growth of Islamic financial system.

This implied that the increase in investment in IEF has a direct effect on the growth of Islamic financial institutions. Thus, higher is the confidence of investors on IEF, the greater the growth of equity fund of Islamic financial institutions. One percent increase in IEF leads to .453 percent increase in IF. This further implied that variable of IEF of this study conferred that variable of growth in IEF is an important factor of overall IF development.

These results strengthen the conceptual theories of the previous literature. It is consistent with the findings of [34, 37]. These results also validate the impact of institutional products and services to the profitability of the overall industry. This also implied that bigger level of investment of IEF has a positive impact on the overall industry and likewise implies more strength to the Islamic financial institutions.

These results empirically proved the relationship of growth of IEF and IF to influence the outward operations of the institutions.

### Banking assets and growth of Islamic finance

The coefficients for the SEM path between financial assets and growth variable of IF (estimated standardized *β* coefficient = .59, with *p* = .000) in final model provide strong significant support for H_{10}.

###
**H**
_{
10
}

Islamic banking assets have a direct effect on the growth of Islamic financial system.

This implied that the increase in the volume of financial assets has a direct effect on the growth of Islamic financial institutions. Thus, higher are the assets of financial institutions, the greater the growth of assets of financial assets. One percent increase in assets leads to .59 percent increase in IF. This further implied that variable of an asset of this study conferred that assets are an important factor of overall IF development.

These results strengthen the conceptual theories of the previous literature. It is consistent with the research findings of studies including [12, 45]. These results also validate the impact of an internal factor of growth to the growth of financial institutions profitability. This also implied that bigger volume of the assets has a positive impact on overall industry likewise implies more strength to the Islamic financial institutions. This result empirically proved the relationship of growth of asset and IF to influence the outward operations of the institutions.