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Exploring the Impacts of Board Flexibility on Non-Performing Assets and Firm Value in the Context of a Fastest Growing Economy

Author

Listed:
  • Md. Nazrul Islam

    (Department of Accounting and Information Systems, Jatiya Kabi Kazi Nazrul Islam University, Trishal, Mymensingh, Bangladesh)

  • Md. Maniruzzaman

    (Department of Accounting and Information Systems, University of Rajshahi, Rajashai-6205, Bangladesh)

  • Syed Zabid Hossain

    (Department of Accounting and Information Systems, University of Rajshahi, Rajshahi-6205, Bangladesh)

Abstract

This paper plans to examine the effects of board extent on non-performing assets (NPA) and firm value measured as comprehensive financial performance (CFP) of banks in Bangladesh using data from 2016 to 2022. Using a sample of 210 firm-year observations, this paper reveals that NPA is significantly related to board size, which signals that a big board of directors (BODs) is linked with lowering the extent of NPA in the context of developing economies like Bangladesh. Besides, the affinity between board extent and firm value proxies as CFP is positive, but the result is not consequential. This research would be value additive to the literature because it examines the effects of board size on NPA and CFP, which is scanty in the corporate finance literature. Furthermore, this research finds no literature that applies CFP as the performance measure of banks, especially in Bangladesh.

Suggested Citation

  • Md. Nazrul Islam & Md. Maniruzzaman & Syed Zabid Hossain, 2024. "Exploring the Impacts of Board Flexibility on Non-Performing Assets and Firm Value in the Context of a Fastest Growing Economy," International Journal of Economics and Financial Issues, Econjournals, vol. 14(5), pages 242-250, September.
    • Handle: RePEc:eco:journ1:2024-05-25
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    More about this item

    Keywords

    corporate governance; board size; Firm value; Bank;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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