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The Impact of Intellectual Capital Efficiency on Bank Risks: Empirical Evidence from the Saudi Banking Industry

Author

Listed:
  • Abdulelah Alrashidi

    (Saudi Arabian Monetary Authority, Economic Research Department, Saudi Arabia.)

  • Omar Alarfaj

    (Saudi Arabian Monetary Authority, Economic Research Department, Saudi Arabia.)

Abstract

The main purpose of conducting this research is to investigate the impact of intellectual capital efficiency (ICE) and its components human capital efficiency (HCE) and structural capital efficiency (SCE) - on bank credit and insolvency risks in the Saudi banking industry. To assess such a relationship, value added intellectual coefficient model (VAIC) along with a couple of panel data techniques were utilized by using quarterly observations spanning from the first quarter of 2009 to the fourth quarter of 2018. The carried out empirical results confirm the existence of a significant negative relationship between ICE, in particular HCE, and bank credit and insolvency risks.

Suggested Citation

  • Abdulelah Alrashidi & Omar Alarfaj, 2020. "The Impact of Intellectual Capital Efficiency on Bank Risks: Empirical Evidence from the Saudi Banking Industry," International Journal of Economics and Financial Issues, Econjournals, vol. 10(4), pages 206-214.
    • Handle: RePEc:eco:journ1:2020-04-25
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    Citations

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    Cited by:

    1. Changjun Zheng & Md Nazmul Islam & Md Nazmus Sadekin & Syed Moudud Ul Huq, 2022. "The Impact of Intellectual Capital on Bank Risk: Evidence from Banking Sectors of Bangladesh," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 11(4), pages 183-192, June.
    2. Faiza Omer Elmahgop, 2024. "Intellectual Capital and Bank Stability in Saudi Arabia: Navigating the Dynamics in a Transforming Economy," Sustainability, MDPI, vol. 16(10), pages 1-23, May.
    3. Omer Ahmed Sayed & Aida Nefzi, 2024. "The Impact of Intellectual Capital on Sustainable Performance: Banking Sector in Saudi Arabia," Sustainability, MDPI, vol. 16(11), pages 1-26, May.

    More about this item

    Keywords

    Intellectual Capital Efficiency; Human Capital; Structural Capital; Credit Risk; insolvency risk; risk management;
    All these keywords.

    JEL classification:

    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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