Purpose – This study attempts to examine Islamic banking practices in Iran based on new scientific methods. Design, methodology, and approach – The study used financial ratios demonstrating healthy or non-healthy banks to assess the financial health of banks listed on the Tehran Stock Exchange. The assessment of these ratios with a decision tree as a non-parametric method for modeling is recommended to present this model. Information about the financial health of banks could affect the decisions of different groups of banks’ financial report users including shareholders, auditors, stock exchanges, central banks, and so on. Results – The results of the study show that a decision tree is a strong approach for classifying Islamic banks in Iran. Conclusions – To date, several studies have been conducted in various countries on the topic of this study. Considering the importance of Islamic banking, this is one of the first studies in Iran the outcomes of the study may prove helpful to the Iranian economy.

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