Does corporate governance influence financial performance of banks – a comparative study between conventional and Islamic Banks

Mafaza, Mariyam (2018) Does corporate governance influence financial performance of banks – a comparative study between conventional and Islamic Banks. [Dissertation (University of Nottingham only)]

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Abstract

The concept corporate governance with its awareness being increased in the past few decades with its popularity rising due to researchers finding it to be a main reason for corporate scandals and failures as well as due to its contribution during the economic crisis’s which occurred in the past.

Taking corporate governance as the subject of the research the samples were taken from 27 conventional banks and 16 commercial banks for 8 years from 2008 to 2015which summed up to be 300 samples. The banks selected were those banks listed in the Kuala Lumpur stock exchange. Banks being a major economic contributor and entity which maintains the financial stability of the economy it is vital to understand the role of corporate governance in banks and the influence corporate governance has on the performance of these banks.

The study was focused in finding the effect of corporate governance on the financial performance of banks and comparison made between Islamic and conventional banks. For this the independent variables were the dimensions created through the development of a corporate governance index. Financial performance measures used were return on equity, return on asset, and debt to equity ratio. The research conducted through the tests made by multiple linear regressions gave out results which nullified the null hypothesises that there was no influence of corporate governance on performance of banks with ROE, ROA and debt to equity taken as performance measure. The results also indicated that Islamic banks had a stronger correlation between the corporate governance and financial performance when compared with conventional banks.

Item Type: Dissertation (University of Nottingham only)
Depositing User: Bujang, Rosini
Date Deposited: 13 Sep 2018 03:17
Last Modified: 08 Feb 2019 12:16
URI: https://eprints.nottingham.ac.uk/id/eprint/54615

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