Children, even siblings, develop at their own rate. It isn't necessarily a sign she should have been held back, but could be a sign she needs more drilling to learn.
Some need repetition, some get it the first time around. Some need to study, some don't.
I would recommend to never allow anyone to compare her to her sibling. That could cause long term damage. Allow her to learn as she needs to and make sure more then one learning style is being introduced. There are 5 learning styles and if her style isn't being taught, that could also be an issue.
There is nothing wrong with holding a child back, if that is what you feel is best. Parents know their children so much better then anyone else. An extra year to mature never has hurt anyone and may be the key you are looking for. See where she is at at the end of the semester and speak to the teacher. Communication is important.
Once you find what works for her, I am sure she will flourish.