Diversity of Shari’ah supervisory board and the performance of Islamic banks: evidence from an emerging economy of Pakistan

Khan, Ismail; Khan, Ikram Ullah; Uddin, Mohammad Jasim; Khan, Safeer Ullah; Marwat, Jahanzeb

doi:10.1108/jiabr-09-2021-0240

Cited by 11 publications

(5 citation statements)

References 101 publications

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“…Research conducted by Mayur & Saravanan (2017) revealed that the number of boards that are too high could cause a bank's performance to decrease. The effect of board size on bank performance is also stated by Khan et al (2023) who state that board size influences the success of Islamic banks in Pakistan.…”

Section: Previous Study and Hypothesis Corporate Governancementioning

confidence: 90%

Does Corporate Governance, Liquidity, and Bank Size Affect the Efficiency of Sharia Banks in Indonesia?

Ghifar,

Zakariyya,

Tristianto

2023

JEBA

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Introduction: The aim of this research was carried out in order to show whether corporate governance, liquidity, and business size might impact the efficiency of an Islamic bank in Indonesia prior to the merger of three Islamic banks, namely BNI Syariah, BRI Syariah, and Bank Syariah Mandiri, and from 2016 to 2021. Methods: Sharia governance is measured using CEO duality proxies and board size, whereas liquidity is measured using DAR, bank size is calculated using the logarithm of total assets, and bank efficiency is measured using three proxies: managerial efficiency, expenses, and profits. The information was compiled from annual financial reports 2016–2021 of 14 Indonesian Islamic commercial banks. Multiple linear regression and testing of conventional hypotheses are used to process the data in SPSS 25. Results: The results of the hypothesis testing indicate that factors affecting management effectiveness are board size, CEO duality, bank size, and liquidity. Conclusion and suggestion: The observation period of the previous five years can be used in future studies to add measurement indicators to corporate governance factors. In order to acquire more varied results with distinct settings of bank efficiency between conventional banks and Islamic banks, study samples might be used that come from conventional banks in addition to these other choices.

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Section: Previous Study and Hypothesis Corporate Governancementioning

confidence: 90%

Does Corporate Governance, Liquidity, and Bank Size Affect the Efficiency of Sharia Banks in Indonesia?

Ghifar,

Zakariyya,

Tristianto

2023

JEBA

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“…SSB qualifications are important for decision-making. Empirical research implies that diverse educational backgrounds are linked to different social status, networking and professional development paths (Khan et al, 2023). Heterogeneity in educational background provides SSB with different perspectives and cognitive paradigms that affect vocational development and social contacts.…”

Section: Imefm 173mentioning

confidence: 99%

Shari’ah governance and transparency: evidence from stock price synchronicity of Islamic banks

Quttainah,

BenSaid

2024

IMEFM

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Purpose The purpose of this study is to investigate internal governance mechanisms factors, focusing on Shari’ah-based governance mechanisms that affect the price synchronicity of Islamic banks (IBs). Design/methodology/approach This study analyzes and compares the effect of Shari’ah and regular governance mechanisms on stock price synchronicity over 2013–2022 using a sample of 51 listed IBs in 13 countries in the Middle East and South Asia region. Using generalized least square method, this paper tests nine hypotheses addressing Shari’ah and regular governance mechanisms. Findings The findings generally reveal that Shari’ah-based governance mechanisms have a significant impact on the stock price synchronicity of IBs. The main determinants of stock price synchronicity among IBs are SSB size, SSB diversity, SSB members’ qualifications in finance Islamic jurisprudence and SSB interlocks. Shari’ah governance plays a detrimental role in improving the association between bank stock price synchronicity and transparency. Research limitations/implications This paper includes three main limitations that may affect the accuracy of the findings. First, this paper relied on publicly available financial statements of IBs online. Hence, the data in this study is from few IBs in each country, which limits the analysis given the reliance is on the best-performing IBs in the country. Second, the results are restricted to the Middle East and South Asia and may not be generalized to other regions. Third, the sample is dominated by Middle East countries (i.e. 37 IBs out of 51). Practical implications Both Shari’ah governance and regular governance have an impact on the transparency of IBs. Policymakers or regulators could encourage IBs to embed SSBs into their internal governance structure for the positive impact the SSBs attributes have on stock price synchronicity and transparency. Originality/value This research studies IBs, unlike most other works that focus on firms.

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“…This is because the SSB carries out and functions in monitoring and reviewing banking activities as a whole including reviewing products, services, contracts, preparing guidelines for sharia banking governance, and ensuring principles and compliance with regulations in their records. This can also be an added value for these Islamic banks because with the SBB, customer confidence in banking activities will increase [41]. Therefore, customers will entrust their funds to be managed by Islamic banking which has an impact on improving financial performance.…”

Section: Bmentioning

confidence: 99%

Islamic Social Reporting (ISR), Sharia Supervisory Board (SSB), and Financial Performance: Empirical Evidence on Islamic Banks in the GCC Region

Iskandar

Marlina

Fasihat

2023

International Journal of Science, Technology & Management

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This study aims to determine the relationship between the disclosure of Islamic social reporting (ISR), the Sharia Supervisory Board (SSB), and the financial performance of Islamic banks in the Gulf Cooperation Council (GCC) region. The Islamic banks that were the sample of the study totaled 25 banks spread across Bahrain, Kuwait, Qatar, Saudi Arabia and the United Arab Emirates with a sample period starting from 2013 to 2017. This research uses multiple regression testing and is complemented by content analysis. The results of content analysis show that the average level of ISR disclosure in Islamic banks in the GCC area is 56.53%. That is, the issues of social responsibility have not become a major concern for most Islamic banks. Furthermore, based on the test results, the ISR disclosure level proved to have a positive effect on financial performance. In addition, the existence of SSB in Islamic banks is also proven to have a positive association with financial performance which is proxied by return on average assets. These findings indicate that there are special things in Islamic banking such as disclosure of ISR and SSB that can have a good impact on the financial performance of Islamic banks.

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Diversity of Shari’ah supervisory board and the performance of Islamic banks: evidence from an emerging economy of Pakistan

Cited by 11 publications

References 101 publications

Does Corporate Governance, Liquidity, and Bank Size Affect the Efficiency of Sharia Banks in Indonesia?

Does Corporate Governance, Liquidity, and Bank Size Affect the Efficiency of Sharia Banks in Indonesia?

Shari’ah governance and transparency: evidence from stock price synchronicity of Islamic banks

Islamic Social Reporting (ISR), Sharia Supervisory Board (SSB), and Financial Performance: Empirical Evidence on Islamic Banks in the GCC Region

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