Impact of leadership style on bank profitability: Case study of a bank in Bosnia and Herzegovina
The goal of this paper is to demonstrate the extent to which the quality of the leader-follower relationship, expressed by the LMX coefficient, affects the bank profitability. Banks characterised by a high level of LMX possess a successful social atmosphere and interpersonal relationships, which is...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
University of Split, Faculty of Economics
2017-01-01
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| Series: | Management : Journal of Contemporary Management Issues |
| Subjects: | |
| Online Access: | https://hrcak.srce.hr/file/281958 |
| _version_ | 1797207758254112768 |
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| author | Adisa Delić Emira Kozarević Mersiha Alić |
| author_facet | Adisa Delić Emira Kozarević Mersiha Alić |
| author_sort | Adisa Delić |
| collection | DOAJ |
| description | The goal of this paper is to demonstrate the extent to which the quality of the leader-follower relationship, expressed by the LMX coefficient, affects the bank profitability. Banks characterised by a high level of LMX possess a successful social atmosphere and interpersonal relationships, which is reflected in the emotional support and willingness to share resources, knowledge, and information between employees. Such a relationship between leaders and followers contributes to creating favourable social atmosphere, significantly affecting the overall performance of banks. Empirical research presented in this paper uses the data collected from a business network of a specifically selected Bank. The data was collected via a modified version of the LMX-7 questionnaire, focusing on each branch of a selected bank. Concrete indicators were analyzed (such as net profit margin, ROA, and ROE), which helped establish a link between profitability and the degree of leader-follower communication exchange (measured by LMX coefficient). The results reveal that the applied leadership style directly impacted on the profitability of a selected bank, indicating that this finding could be used as input for management systems of similar financial institutions as well as a catalyst for further research in this field. |
| first_indexed | 2024-04-24T09:28:00Z |
| format | Article |
| id | doaj.art-945edad7212542ce82b88633bde49b55 |
| institution | Directory Open Access Journal |
| issn | 1331-0194 1846-3363 |
| language | English |
| last_indexed | 2024-04-24T09:28:00Z |
| publishDate | 2017-01-01 |
| publisher | University of Split, Faculty of Economics |
| record_format | Article |
| series | Management : Journal of Contemporary Management Issues |
| spelling | doaj.art-945edad7212542ce82b88633bde49b552024-04-15T14:30:39ZengUniversity of Split, Faculty of EconomicsManagement : Journal of Contemporary Management Issues1331-01941846-33632017-01-01222657710.30924/mjcmi/2017.22.2.65Impact of leadership style on bank profitability: Case study of a bank in Bosnia and HerzegovinaAdisa Delić0Emira Kozarević1Mersiha Alić2University of Tuzla, Faculty of EconomicsUniversity of Tuzla, Faculty of EconomicsIndiana Institute of TechnologyThe goal of this paper is to demonstrate the extent to which the quality of the leader-follower relationship, expressed by the LMX coefficient, affects the bank profitability. Banks characterised by a high level of LMX possess a successful social atmosphere and interpersonal relationships, which is reflected in the emotional support and willingness to share resources, knowledge, and information between employees. Such a relationship between leaders and followers contributes to creating favourable social atmosphere, significantly affecting the overall performance of banks. Empirical research presented in this paper uses the data collected from a business network of a specifically selected Bank. The data was collected via a modified version of the LMX-7 questionnaire, focusing on each branch of a selected bank. Concrete indicators were analyzed (such as net profit margin, ROA, and ROE), which helped establish a link between profitability and the degree of leader-follower communication exchange (measured by LMX coefficient). The results reveal that the applied leadership style directly impacted on the profitability of a selected bank, indicating that this finding could be used as input for management systems of similar financial institutions as well as a catalyst for further research in this field.https://hrcak.srce.hr/file/281958banksleadershipleader-member exchange (LMX)in-group exchangeout-group exchange |
| spellingShingle | Adisa Delić Emira Kozarević Mersiha Alić Impact of leadership style on bank profitability: Case study of a bank in Bosnia and Herzegovina Management : Journal of Contemporary Management Issues banks leadership leader-member exchange (LMX) in-group exchange out-group exchange |
| title | Impact of leadership style on bank profitability: Case study of a bank in Bosnia and Herzegovina |
| title_full | Impact of leadership style on bank profitability: Case study of a bank in Bosnia and Herzegovina |
| title_fullStr | Impact of leadership style on bank profitability: Case study of a bank in Bosnia and Herzegovina |
| title_full_unstemmed | Impact of leadership style on bank profitability: Case study of a bank in Bosnia and Herzegovina |
| title_short | Impact of leadership style on bank profitability: Case study of a bank in Bosnia and Herzegovina |
| title_sort | impact of leadership style on bank profitability case study of a bank in bosnia and herzegovina |
| topic | banks leadership leader-member exchange (LMX) in-group exchange out-group exchange |
| url | https://hrcak.srce.hr/file/281958 |
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