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Intellectual Capital (IC) Determinants: Impact on Productivity of Islamic Banks

Binus Business Review

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Field Value
 
Title Intellectual Capital (IC) Determinants: Impact on Productivity of Islamic Banks
 
Creator Ab. Aziz, Muhammad Ridhwan
Meor Hashim, Ahmad Azwan
 
Subject Islamic bank, Islamic Finance
Intellectual Capital (IC), Value-Added Intellectual Coefficient (VAIC), productivity, bank size, bank risks, leverage, Islamic banks
 
Description This research aimed to investigate the relationship between the Intellectual Capital (IC) efficiency empirically. It consisted of human capital, structural capital, capital employed, and relational capital with the impact on the productivity of Islamic banks in Malaysia. The Pulic’s Value-Added Intellectual Coefficient (VAIC) method with the extended and modified version introduced by former scholars was used to measure IC, whereas bank productivity was measured through Assets Turnover Ratio (ATO). Three internal factors that might have determinants effect on VAIC, namely bank size, bank risks, and leverage were further tested to find their relationship. Structural stability tests and dynamic regression models for panel data were also used for the data of 16 Islamic banks in Malaysia from 2009 to 2016. The panel-corrected standard errors estimation technique was used to estimate a panel regression model with bank productivity and VAIC as the dependent variables. The regression analysis suggests that Malaysian Islamic banks are depending heavily on the capital employed component of intellectual capital, followed by human capital, structural capital, and relational capital. The results also suggest that bank’s risks and leverage play a major role in determining intellectual capital. The findings may serve as a useful input for Islamic bankers to indicate whether the contribution of intellectual capital and its components needs further improvement which it has produced the best results, and internal factor might affect IC.
 
Publisher Bina Nusantara University
 
Contributor —
 
Date 2017-11-30
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://journal.binus.ac.id/index.php/BBR/article/view/3741
10.21512/bbr.v8i3.3741
 
Source Binus Business Review; Vol 8, No 3 (2017): Binus Business Review; 189-197
2476-9053
2087-1228
 
Language eng
 
Relation http://journal.binus.ac.id/index.php/BBR/article/view/3741/3220