Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation

Vishwa Nath Maurya; Rama Shanker Sharma; Saad Talib Hasson Aljebori; Avadhesh Kumar Maurya; Diwinder Kaur Arora

doi:doi:10.11648/j.ajtas.s.2015040201.14

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Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation

Vishwa Nath Maurya, Rama Shanker Sharma, Saad Talib Hasson Aljebori, Avadhesh Kumar Maurya, Diwinder Kaur Arora

Published in American Journal of Theoretical and Applied Statistics (Volume 4, Issue 2-1)

Received: 4 December 2014 Accepted: 5 December 2014 Published: 11 March 2015

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Abstract

Present paper deals with problems of determining the relationship between the variables of corporate governance and financial performance of Islamic banks, where we dealt the corporate governance in the banking sector, where increasing the importance of corporate governance, due to their special nature, as the bankruptcy of banks affects not only the relevant parties from customers, depositors and lenders, but affect financial stability and then the economy as a whole. Through this paper we dealt to the specificity of governance in Islamic banks, which face Double Governance: Anglo-Saxon governance system and Islamic Governance System. In addition, we focused our attention to measure the impact of corporate governance variables on financial performance through an empirical study on a sample of Islamic banks during the period 2005-2012 in the GCC region. Our present study implies that there is a very strong relationship between the variables of governance and financial performance of Islamic banks, where there is a positive relationship between return on assets and the composition of the Board of Directors, the size of the Board of Directors, the number of committees in the Council, as well as the number of members of the Sharia Supervisory Board, while it is clear that there is a negative relationship between return on assets and concentration ownership variable.

Published in	American Journal of Theoretical and Applied Statistics (Volume 4, Issue 2-1) This article belongs to the Special Issue Scope of Statistical Modeling and Optimization Techniques in Management Decision Making Process
DOI	10.11648/j.ajtas.s.2015040201.14
Page(s)	27-32
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2015. Published by Science Publishing Group

Keywords

Correlation analysis, parametric estimation, corporate governance, financial performance, financial stability, conventional banks, bankruptcy, Islamic governance system

References

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[2]	Ghazi Louizi, Impact Du Conseil D’administration Sur La Performance Des Banques Tunisiennes, XVème Conférence Internationale de Management Stratégique, Annecy Genève, 13-16 Jun 2006.
[3]	Jean-Pierre P., la stabilité financière nouvelle urgence pour les banques centrales, Bulletin de la Banque de France, No. 84, Décembre 2000.
[4]	Matoussi Hamadi and Grassa Rihab, Is corporate governance different for Islamic banks? A comparative analysis between The GCC Context and The SEA Context, Working Paper No.734, Economic Research Forum, Egypt, 2012.
[5]	Maurya V.N. and Kaushik A.P., On the job training: A step towards job satisfaction- A case study of public sector organization in Indian scenario, International Journal of Mathematical Modeling and Applied Computing, Academic & Scientific Publishing, New York, USA, Vol. 1(2), pp. 11-17, 2013, ISSN: 2332-3744
[6]	Maurya Vishwa Nath, Arora Diwinder Kaur, Maurya Avadhesh Kumar and Gautam R.A., Exact modeling of annual maximum rainfall with Gumbel and Frechet distributions using parameter estimation techniques, World of Sciences Journal, Engineers Press Publishing, Vienna, Austria, Vol. 1(2), pp.11-26, 2013, ISSN: 2307-3071
[7]	Maurya V.N., Covariance analysis of a non-homogeneous Mx(t)/G(t)/∞:(∞;FCFS) queueing system with bulk arrival and arbitrary service time distribution, Acta Ciencia Indica Mathematics, Vol.32M, No.3, pp. 1183-1188, 2006 (Citation No. 015878, Indian Science Abstract, Vol. 43, No. 16, 2007), ISSN: 0970-0455
[8]	Maurya V.N., Jaggi C.K., Singh Bijay, Arneja C.S., Maurya A.K., and Arora D.K., Empirical analysis of work life balance policies and its impact on employee’s job satisfaction and performance: Descriptive statistical approach, Special Issue: Scope of Statistical Modeling and Optimization Techniques in Management and Decision Making Process, American Journal of Theoretical and Applied Statistics, USA, 2014.
[9]	Maurya V.N., Reddy N., Maurya A.K. and Datt N., Optimization perspectives and effectiveness of gender in organizational leadership: Scenario of employees satisfaction and organizational goals, IEC University Journal of Engineering, Management and Sciences, India, Vol. 1(1), pp. 15-29, 2014
[10]	Maurya V.N., Singh Bijay, Reddy N., Singh V.V., Maurya A.K., Arora D.K., Cost-effective perspective and scenario development on economic optimization for multiple-use dry-season water resource management, American Open Journal of Agricultural Research, Academic & Scientific Publishing, New York, USA, Vol. 2(1), pp. 1-21, 2014, ISSN:2333-2131
[11]	Maurya Vishwa Nath, Fang Xuan, and Yang Feng, Assessing Chinese commercial bank technical efficiency using parametric hyperbolic distance function approach, American Journal of Applied Mathematics and Statistics, Science & Education Publishing, USA, Vol. 2, No. 6A, pp. 20-25, 2014
[12]	Mehram H, Corporate governance in the banking and financial services industries, Journal of Financial Intermediation, Vol. 13, 2004.
[13]	Mohammed U.C. and Ahmad H., Corporate governance in Islamic financial institutions, Occasional Paper, No. 06, I.R.T.I, Islamic Development Bank, 2002.
[14]	Rehman R.U. and Mangla I.U., Corporate governance and performance of financial institutions in Pakistan: A comparison between Conventional and Islamic banks in Pakistan, The Pakistan Development Review, Pakistan, 2010.
[15]	Sebastian M., International and Mena wide trends and developments in bank and corporate governance, The Institute of Banking, IFC: Corporate governance for banks in Saudi Arabia forum, Riyadh, Saudi Arabia, 22-23 May, 2007.

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APA Style

Vishwa Nath Maurya, Rama Shanker Sharma, Saad Talib Hasson Aljebori, Avadhesh Kumar Maurya, Diwinder Kaur Arora. (2015). Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation. American Journal of Theoretical and Applied Statistics, 4(2-1), 27-32. https://doi.org/10.11648/j.ajtas.s.2015040201.14

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ACS Style

Vishwa Nath Maurya; Rama Shanker Sharma; Saad Talib Hasson Aljebori; Avadhesh Kumar Maurya; Diwinder Kaur Arora. Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation. Am. J. Theor. Appl. Stat. 2015, 4(2-1), 27-32. doi: 10.11648/j.ajtas.s.2015040201.14

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AMA Style

Vishwa Nath Maurya, Rama Shanker Sharma, Saad Talib Hasson Aljebori, Avadhesh Kumar Maurya, Diwinder Kaur Arora. Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation. Am J Theor Appl Stat. 2015;4(2-1):27-32. doi: 10.11648/j.ajtas.s.2015040201.14

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@article{10.11648/j.ajtas.s.2015040201.14,
  author = {Vishwa Nath Maurya and Rama Shanker Sharma and Saad Talib Hasson Aljebori and Avadhesh Kumar Maurya and Diwinder Kaur Arora},
  title = {Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation},
  journal = {American Journal of Theoretical and Applied Statistics},
  volume = {4},
  number = {2-1},
  pages = {27-32},
  doi = {10.11648/j.ajtas.s.2015040201.14},
  url = {https://doi.org/10.11648/j.ajtas.s.2015040201.14},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajtas.s.2015040201.14},
  abstract = {Present paper deals with problems of determining the relationship between the variables of corporate governance and financial performance of Islamic banks, where we dealt the corporate governance in the banking sector, where increasing the importance of corporate governance, due to their special nature, as the bankruptcy of banks affects not only the relevant parties from customers, depositors and lenders, but affect financial stability and then the economy as a whole. Through this paper we dealt to the specificity of governance in Islamic banks, which face Double Governance: Anglo-Saxon governance system and Islamic Governance System. In addition, we focused our attention to measure the impact of corporate governance variables on financial performance through an empirical study on a sample of Islamic banks during the period 2005-2012 in the GCC region. Our present study implies that there is a very strong relationship between the variables of governance and financial performance of Islamic banks, where there is a positive relationship between return on assets and the composition of the Board of Directors, the size of the Board of Directors, the number of committees in the Council, as well as the number of members of the Sharia Supervisory Board, while it is clear that there is a negative relationship between return on assets and concentration ownership variable.},
 year = {2015}
}

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TY  - JOUR
T1  - Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation
AU  - Vishwa Nath Maurya
AU  - Rama Shanker Sharma
AU  - Saad Talib Hasson Aljebori
AU  - Avadhesh Kumar Maurya
AU  - Diwinder Kaur Arora
Y1  - 2015/03/11
PY  - 2015
N1  - https://doi.org/10.11648/j.ajtas.s.2015040201.14
DO  - 10.11648/j.ajtas.s.2015040201.14
T2  - American Journal of Theoretical and Applied Statistics
JF  - American Journal of Theoretical and Applied Statistics
JO  - American Journal of Theoretical and Applied Statistics
SP  - 27
EP  - 32
PB  - Science Publishing Group
SN  - 2326-9006
UR  - https://doi.org/10.11648/j.ajtas.s.2015040201.14
AB  - Present paper deals with problems of determining the relationship between the variables of corporate governance and financial performance of Islamic banks, where we dealt the corporate governance in the banking sector, where increasing the importance of corporate governance, due to their special nature, as the bankruptcy of banks affects not only the relevant parties from customers, depositors and lenders, but affect financial stability and then the economy as a whole. Through this paper we dealt to the specificity of governance in Islamic banks, which face Double Governance: Anglo-Saxon governance system and Islamic Governance System. In addition, we focused our attention to measure the impact of corporate governance variables on financial performance through an empirical study on a sample of Islamic banks during the period 2005-2012 in the GCC region. Our present study implies that there is a very strong relationship between the variables of governance and financial performance of Islamic banks, where there is a positive relationship between return on assets and the composition of the Board of Directors, the size of the Board of Directors, the number of committees in the Council, as well as the number of members of the Sharia Supervisory Board, while it is clear that there is a negative relationship between return on assets and concentration ownership variable.
VL  - 4
IS  - 2-1
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Author Information

Vishwa Nath Maurya

Department of Pure & Applied Mathematics and Statistics, School of Science & Technology, The University of Fiji, Lautoka, Fiji Islands
Rama Shanker Sharma

Department of Statistics, Eritrea Institute of Technology, Asmara, Eritrea
Saad Talib Hasson Aljebori

Al Musyab Engineering College, University of Babylon, Babylon
Avadhesh Kumar Maurya

Department of Electronics & Communication Engineering, Lucknow Institute of Technology, U.P. Technical University, Lucknow, India
Diwinder Kaur Arora

Group Centre, Central Reserve Police Force, Ministry of Home Affairs, Govt. of India, Guwahati, Assam, India

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APA Style

Vishwa Nath Maurya, Rama Shanker Sharma, Saad Talib Hasson Aljebori, Avadhesh Kumar Maurya, Diwinder Kaur Arora. (2015). Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation. American Journal of Theoretical and Applied Statistics, 4(2-1), 27-32. https://doi.org/10.11648/j.ajtas.s.2015040201.14

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ACS Style

Vishwa Nath Maurya; Rama Shanker Sharma; Saad Talib Hasson Aljebori; Avadhesh Kumar Maurya; Diwinder Kaur Arora. Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation. Am. J. Theor. Appl. Stat. 2015, 4(2-1), 27-32. doi: 10.11648/j.ajtas.s.2015040201.14

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AMA Style

Vishwa Nath Maurya, Rama Shanker Sharma, Saad Talib Hasson Aljebori, Avadhesh Kumar Maurya, Diwinder Kaur Arora. Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation. Am J Theor Appl Stat. 2015;4(2-1):27-32. doi: 10.11648/j.ajtas.s.2015040201.14

Copy | Download

@article{10.11648/j.ajtas.s.2015040201.14,
  author = {Vishwa Nath Maurya and Rama Shanker Sharma and Saad Talib Hasson Aljebori and Avadhesh Kumar Maurya and Diwinder Kaur Arora},
  title = {Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation},
  journal = {American Journal of Theoretical and Applied Statistics},
  volume = {4},
  number = {2-1},
  pages = {27-32},
  doi = {10.11648/j.ajtas.s.2015040201.14},
  url = {https://doi.org/10.11648/j.ajtas.s.2015040201.14},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajtas.s.2015040201.14},
  abstract = {Present paper deals with problems of determining the relationship between the variables of corporate governance and financial performance of Islamic banks, where we dealt the corporate governance in the banking sector, where increasing the importance of corporate governance, due to their special nature, as the bankruptcy of banks affects not only the relevant parties from customers, depositors and lenders, but affect financial stability and then the economy as a whole. Through this paper we dealt to the specificity of governance in Islamic banks, which face Double Governance: Anglo-Saxon governance system and Islamic Governance System. In addition, we focused our attention to measure the impact of corporate governance variables on financial performance through an empirical study on a sample of Islamic banks during the period 2005-2012 in the GCC region. Our present study implies that there is a very strong relationship between the variables of governance and financial performance of Islamic banks, where there is a positive relationship between return on assets and the composition of the Board of Directors, the size of the Board of Directors, the number of committees in the Council, as well as the number of members of the Sharia Supervisory Board, while it is clear that there is a negative relationship between return on assets and concentration ownership variable.},
 year = {2015}
}

Copy | Download

TY  - JOUR
T1  - Correlation Analysis between the Corporate Governance and Financial Performance of Banking Sectors Using Parameter Estimation
AU  - Vishwa Nath Maurya
AU  - Rama Shanker Sharma
AU  - Saad Talib Hasson Aljebori
AU  - Avadhesh Kumar Maurya
AU  - Diwinder Kaur Arora
Y1  - 2015/03/11
PY  - 2015
N1  - https://doi.org/10.11648/j.ajtas.s.2015040201.14
DO  - 10.11648/j.ajtas.s.2015040201.14
T2  - American Journal of Theoretical and Applied Statistics
JF  - American Journal of Theoretical and Applied Statistics
JO  - American Journal of Theoretical and Applied Statistics
SP  - 27
EP  - 32
PB  - Science Publishing Group
SN  - 2326-9006
UR  - https://doi.org/10.11648/j.ajtas.s.2015040201.14
AB  - Present paper deals with problems of determining the relationship between the variables of corporate governance and financial performance of Islamic banks, where we dealt the corporate governance in the banking sector, where increasing the importance of corporate governance, due to their special nature, as the bankruptcy of banks affects not only the relevant parties from customers, depositors and lenders, but affect financial stability and then the economy as a whole. Through this paper we dealt to the specificity of governance in Islamic banks, which face Double Governance: Anglo-Saxon governance system and Islamic Governance System. In addition, we focused our attention to measure the impact of corporate governance variables on financial performance through an empirical study on a sample of Islamic banks during the period 2005-2012 in the GCC region. Our present study implies that there is a very strong relationship between the variables of governance and financial performance of Islamic banks, where there is a positive relationship between return on assets and the composition of the Board of Directors, the size of the Board of Directors, the number of committees in the Council, as well as the number of members of the Sharia Supervisory Board, while it is clear that there is a negative relationship between return on assets and concentration ownership variable.
VL  - 4
IS  - 2-1
ER  -

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