CORPORATE GOVERNANCE QUALITY, RISK MANAGEMENT PRACTICES AND FINANCIAL PERFORMANCE

  • Syed Muhammad Khalid MS Finance National University of Modern Languages Pakistan
  • Dr. Alam Rehman Faculty of Management Sciences, National University of Modern Languages; Pakistan
  • Muhammad Zeeshan College of Business Administration, Liaoning Technical University, Liaoning province, XingCheng, 125105, China,
  • Isbat Alam College of Business Administration, Liaoning Technical University, Liaoning province, XingCheng, 125105, China,

Abstract

The study was conducted with a view to ascertain the effect of corporate governance quality and risk management on the financial performance of listed banks in Pakistan, covering both Islamic and conventional portfolios. The study applied random sampling techniques for those firms which had continuous data. The study analysed the data of 30 banks for the period 2010 to 2017. The main statistical tools used in the data analysis are correlation and regression. The results demonstrated positive and significant effect of the Corporate Governance Quality on the proxies of financial performance. While Capital Adequacy ratio showed insignificant but positive effect on the banking financial performance. The risk management proxy Non-Performing Loan ratio has negative significant effect on the financial performance of Pakistani banks. The positive insignificant effect of Cost per Loan Ratio and Cash Reserve Ratio on the Financial Performance of bank has been reported in the results. The results confirmed the positive significant effect of Z-score on the proxies of financial performance.  The findings of the study can be vital for the top management of these bank as well as other institutions in financial sector and the investors can also be benefited from the results.

Key Words:   Corporate Governance Quality; Risk Management Practices; Financial Performance, Correlation; Regression; Pakistan

Published
2021-01-05
How to Cite
[1]
S. Khalid, D. Rehman, M. Zeeshan, and I. Alam, “CORPORATE GOVERNANCE QUALITY, RISK MANAGEMENT PRACTICES AND FINANCIAL PERFORMANCE”, jmr, vol. 6, no. 2, pp. 23-48, Jan. 2021.