Factors Determining Libyan Banking Employees’ Readiness to Support the Transformation to a Full-Fledged Islamic Banking System

Abstract

The purpose of this research is to examine the determinants of banking employees’ readiness to support the transformation to the full-fledged Islamic banking system in Libya. Using the Theory of Planned Behaviour (TPB) and employing survey questionnaires of 323 employees of 10 conventional Libyan banks analysed using Structural Equation Modelling (SEM). This research revealed that the readiness of Libyan banks’ employees is influenced significantly and positively by attitudinal, religious and subjective norms. Moreover, attitude toward transformation is the most critical factor that determines readiness among bank employees. This indicates that bank employees are willing to support the transformation process toward Islamic banking. Due to the unstable security situation in Libya, this research is confined to two states (Tripoli and Benghazi). Further researches may extend applying the proposed model to other states in the country, which may enhance the generalisability of this research’s findings. Overall, this research provides support for the transformation process to Islamic banking as a way to evaluate the readiness of Libyan banking employees for such change. Also, this research emphasizes the importance of undertaking a pre-implementation evaluation of readiness for change in Libyan commercial banks.