Objective - This research aims to analyse the efficiency of Islamic banking in Indonesia and Malaysia based on the maqashid shariah approach.

Methodology/Technique - This research uses individual education, creation of justice, and achievement of welfare to measure the efficiency variable. The research period covers the period from 2011 to 2015, using data envelope analysis (DEA).

Findings - The result show that there are three (3) Islamic banks that achieve maximum efficiency in Malaysia. These are: Affin Islamic Bank Berhad, which achieved maximum efficiency in terms of distribution and profitability output, CIMB Islamic Bank, which achieved maximum efficiency in terms of distribution output, and RHB Islamic Bank Berhad, which achieved maximum efficiency in terms of distribution output. Meanwhile, two (2) Islamic banks which were considered to be efficient, although not at the maximum level.

Novelty - This study shows that Bank Panin Syariah achieves maximum efficiency with respect to distribution output, and that Bank Mega Syariah is considered efficient with respect to profitability output and personal revenue output.

Type of Paper - Empirical

Keywords: Islamic Banks; Efficiency; Maqashid Shariah; DEA; Indonesia; Malaysia.

JEL Classification: G20, G21.