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International Journal of Academic Research in Accounting, Finance and Management Sciences

Open Access Journal

ISSN: 2225-8329

The Impact of Corporate Governance on the Banking Financial Performance: The Mediating Role of Liquidity

Rami Mohammad Bassam Abdel Ra’uof Nairokh, Anwar Allah Pitchay, Muhammad Shabir Shaharudin, Mohammad Abed AL Qader Alshakhanbeh

http://dx.doi.org/10.6007/IJARAFMS/v14-i4/23575

Open access

This study investigates the impact of corporate governance on the financial performance of the banking sector in (GCC) countries. The study employs quantitative research design, collecting data from 2014 to 2021 across 55 banks in the GCC region. (PLS-SEM) was utilized to analyse the relationships between corporate governance, liquidity, and financial performance. The study indicates a statistically significant negative relationship between board diversity and financial performance, specifically with (ROA) and (ROE). Regarding board meeting frequency, the study found no significant effect on ROA, however there was a significant negative relationship with ROE. On the other hand, board size does not significantly affect either ROA or ROE. Similarly, the relationship between board independence and both ROA and ROE were found to be non-significant. Furthermore, the study highlights a significant negative relationship between liquidity and both ROA and ROE. For board independence, liquidity partially mediates the relationship with ROA and ROE. For board meeting frequency, liquidity negative and significant with ROA. However, for board diversity, liquidity does not play a significant mediating role between board diversity and ROA or ROE. liquidity partially mediates the relationship between board meeting frequency with ROA, ROE

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Nairokh, R. M. B. A. R., Pitchay, A. A., Shaharudin, M. S., & Alshakhanbeh, M. A. A. Q. (2024). The Impact of Corporate Governance on the Banking Financial Performance: The Mediating Role of Liquidity. International Journal of Academic Research in Accounting, Finance and Management Sciences, 14(4), 763–795.