SHARI'A SUPERVISORY BOARD AND ISLAMIC BANKS’ INSOLVENCY RISK
This study examines how the characteristics and quality of Shari'a supervisory board (SSB) influence the insolvency risk of Islamic banks. It employs unbalanced panel data of 43 Islamic banks in 15 countries between 2010 and 2020, which are hand-collected from the banks’ annual reports. The res...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
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Bank Indonesia
2023-08-01
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| Series: | Journal of Islamic Monetary Economics and Finance |
| Subjects: | |
| Online Access: | https://jimf-bi.org/index.php/JIMF/article/view/1635 |
| _version_ | 1827394011364589568 |
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| author | Umar Habibu Umar Muhamad Abduh Mohd Hairul Azrin Besar |
| author_facet | Umar Habibu Umar Muhamad Abduh Mohd Hairul Azrin Besar |
| author_sort | Umar Habibu Umar |
| collection | DOAJ |
| description | This study examines how the characteristics and quality of Shari'a supervisory board (SSB) influence the insolvency risk of Islamic banks. It employs unbalanced panel data of 43 Islamic banks in 15 countries between 2010 and 2020, which are hand-collected from the banks’ annual reports. The results indicate that the SSB quality index, SSB Islamic finance professional expertise and SSB competency increase insolvency risk while the SSB members with PhDs reduce it. Meanwhile, SSB size, SSB meetings, SSB gender diversity (SSBG) and SSB members from foreign countries have no significant influence on the insolvency risk. These findings have implications for policymakers and regulators in carving policies and regulations in restraining the SSB from taking excessive risk. They can also guide the Islamic banks' board of directors and shareholders in appointing the SSB members. |
| first_indexed | 2024-03-08T17:59:47Z |
| format | Article |
| id | doaj.art-08ef5433626d44968c87dc918cf8282f |
| institution | Directory Open Access Journal |
| issn | 2460-6146 2460-6618 |
| language | English |
| last_indexed | 2024-03-08T17:59:47Z |
| publishDate | 2023-08-01 |
| publisher | Bank Indonesia |
| record_format | Article |
| series | Journal of Islamic Monetary Economics and Finance |
| spelling | doaj.art-08ef5433626d44968c87dc918cf8282f2024-01-02T01:43:58ZengBank IndonesiaJournal of Islamic Monetary Economics and Finance2460-61462460-66182023-08-019341944210.21098/jimf.v9i3.16351635SHARI'A SUPERVISORY BOARD AND ISLAMIC BANKS’ INSOLVENCY RISKUmar Habibu Umar0Muhamad Abduh1Mohd Hairul Azrin Besar2Department of Accounting and Finance, School of Business and Economics, Universiti Brunei Darussalam, Brunei DarussalamDepartment of Accounting and Finance, School of Business and Economics, Universiti Brunei Darussalam, Brunei DarussalamDepartment of Accounting and Finance, School of Business and Economics, Universiti Brunei Darussalam, Brunei DarussalamThis study examines how the characteristics and quality of Shari'a supervisory board (SSB) influence the insolvency risk of Islamic banks. It employs unbalanced panel data of 43 Islamic banks in 15 countries between 2010 and 2020, which are hand-collected from the banks’ annual reports. The results indicate that the SSB quality index, SSB Islamic finance professional expertise and SSB competency increase insolvency risk while the SSB members with PhDs reduce it. Meanwhile, SSB size, SSB meetings, SSB gender diversity (SSBG) and SSB members from foreign countries have no significant influence on the insolvency risk. These findings have implications for policymakers and regulators in carving policies and regulations in restraining the SSB from taking excessive risk. They can also guide the Islamic banks' board of directors and shareholders in appointing the SSB members.https://jimf-bi.org/index.php/JIMF/article/view/1635risk-taking, shari'a supervisory board (ssb), ssb quality index, ssb characteristics, islamic banks. |
| spellingShingle | Umar Habibu Umar Muhamad Abduh Mohd Hairul Azrin Besar SHARI'A SUPERVISORY BOARD AND ISLAMIC BANKS’ INSOLVENCY RISK Journal of Islamic Monetary Economics and Finance risk-taking, shari'a supervisory board (ssb), ssb quality index, ssb characteristics, islamic banks. |
| title | SHARI'A SUPERVISORY BOARD AND ISLAMIC BANKS’ INSOLVENCY RISK |
| title_full | SHARI'A SUPERVISORY BOARD AND ISLAMIC BANKS’ INSOLVENCY RISK |
| title_fullStr | SHARI'A SUPERVISORY BOARD AND ISLAMIC BANKS’ INSOLVENCY RISK |
| title_full_unstemmed | SHARI'A SUPERVISORY BOARD AND ISLAMIC BANKS’ INSOLVENCY RISK |
| title_short | SHARI'A SUPERVISORY BOARD AND ISLAMIC BANKS’ INSOLVENCY RISK |
| title_sort | shari a supervisory board and islamic banks insolvency risk |
| topic | risk-taking, shari'a supervisory board (ssb), ssb quality index, ssb characteristics, islamic banks. |
| url | https://jimf-bi.org/index.php/JIMF/article/view/1635 |
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