The purpose of this study is to examine the effects of ownership concentration, board characteristics and Sharia governance financial performance, risk-taking behaviour and Basel compliance of Islamic banks. Our sample is based on 60 Islamic banks form the GCC and non-GCC countries covering a period of five years (2014-2018). We use descriptive statistics (e.g., mean and standard deviation), univariate (e.g., correlations and t-tests), multivariate (OLS regressions) techniques to analyse governance and financial data. We find that board size has a statistically negative association with profitability and valuation, and a positive association with risk-taking, asset quality and capital adequacy. In addition, board independence is found to be positively associated with valuation, asset quality and capital adequacy, and negatively associated with risk-taking behaviour. Among Sharia governance characteristics, Sharia board size shows a positive association and Sharia board expertise shows a negative association with risk-taking behaviour. Moreover, Sharia board interlocking shows positive relationship with profitability, valuation and risk-taking. Finally, we find ownership concentration to be positively associated to valuation and risk-taking behaviour of IBs.
|Publication status||Published - 16 Jan 2020|
|Event||5th International Conference on Emerging Research Paradigms in Business and Social Sciences 2020 - Middlesex University Dubai, Dubai, United Arab Emirates|
Duration: 14 Jan 2020 → 16 Jan 2020
|Conference||5th International Conference on Emerging Research Paradigms in Business and Social Sciences 2020|
|Abbreviated title||ERPBSS 2020|
|Country||United Arab Emirates|
|Period||14/01/20 → 16/01/20|
- Islamic Banking
- Ownership and board characteristics
- Sharia governance
- Financial performance and risk-taking
- Capital adequacy and asset quality
ASJC Scopus subject areas
Mendonca, A., & Haque, F. (2020). Impact of Corporate Governance Mechanisms on Financial Performance, Risk-Taking and Basel Compliance of Islamic Banks. Paper presented at 5th International Conference on Emerging Research Paradigms in Business and Social Sciences 2020, Dubai, United Arab Emirates.