Banking Sector Of Pakistan Research Articles

Impact of Risk Management Practices on Bank Performance: A case of Banking Sector in Pakistan

This paper aims to investigate the impact of risk management practices on the banking sector of Pakistan. Papulation of this study was the employee in the banking sector in the risk management department. The researcher used random sampling to collect data to test the hypothesis of this study. The researcher used SEM to analyze this study. The result reveals that the independent variables, i.e., risk management, level of risk control & monitoring, risk identification, and level of risk control & monitoring, was positive and significant on the dependent variable, i.e., bank performance. The researcher recommended that a comparative analysis of both Islamic and conventional banking be conducted in the future.

Corporate Governance and Firm Performance: Empirical Evidence from Pakistan Banking Sector

Corporate governance is important in developing a culture of integrity in an organization that enhances the performance of business resulting in sustainability in the business of the organization. The purpose of this study is to investigate the impact of corporate governance factors on bank performance in Pakistan. The data was collected from 15 banks from the period of 2010 to 2020. The data was collected from the financial reports of the banks. The dependent variable was returning on assets as a proxy of firm performance and the independent variables were corporate governance factors (namely, the board size, firm size, independent directors, CEO duality, and leverage). The technique was applied for this research included the Co-integration test, the Hausman test to determine Random or Fixed Effect, and the Panel Least Square Regression to check the relationship between variables The result found that board size has a significant effect on return on assets indicated that optimum board size in an organization increases the ROA. The results found board independence has a significant effect on return on assets indicating the independency of directors is involved in creating greater value for shareholders. The results found that CEO/Chairman duality has an insignificant impact on return on assets. The results found leverage has a significant impact on return on assets indicating that having high leverage earns more profit. The results found a positive impact of firm size on return on assets. Results can be concluded that improvement in corporate practices increases the firm performance shows the positive revenue generates by the company and the company used its assets through business. Good CG practices make firm-healthy

Peeking Beyond Profitability: Effects of Merger and Acquisition on Microeconomic Indicators in Banking Industry

The purpose of this study is to provide relative information on mergers & acquisition events of banks in Pakistan. To evaluate the profitability and microeconomic factor of banks in Pakistan, financials for thirteen years (2006-2017) were examined with the help of financial ratios. The research applied secondary data which were gathered from the financial statements of banks, and their websites. In this research, every financial decision-making process, ratio analysis by timeline method is most often utilized. The outcomes illustrate that the pre-merger performance of banking sector of Pakistan in the dimensions of profitability and loan/deposits was fairly satisfying. It clarifies that merger activity was unsuccessful in increasing the financial productivity of the bank, but banks become one with other small and the same sized banks simply to increase market shares, to increase their assets and to reveal concealed morals.

Human Resource Management Practices and Employee Performance in the Banking Sector of Pakistan: The Role of Islamic Work Ethic

Purpose: The present study aims to investigate the relationship between human resource management practices (recruitment and selection, training and development and performance appraisal) and employee’s performance. Further, this study examines the moderating role of Islamic Work Ethics in the direct link mentioned above in the banking sector of Pakistan.
 Design/Methodology/Approach: The data were collected from 256 employees working in the banking sector of Pakistan. To test the hypothesized relationships, multiple regression analysis was conducted. 
 Findings: The findings indicated the significant impact of human resource management practices (recruitment and selection, training and development and performance appraisal) on employee performance. Moreover, the moderating role of Islamic Work Ethics was also supported. This study found the Islamic Work Ethics strengthens the relationship between human resource management practices (recruitment and selection, training and development and performance appraisal), employee’s performance.
 Implications/Originality/Value This concludes that human resource management practices are essential for every organization that enhance the Employee’s Performance. Further it is revealed Islamic Work Ethics moderates the relationship between human resource management practices and Employees Performance. Implications and future research for practice and directions are discussed.

Impact of Abusive supervision, Ostracism and Workplace bullying on employee performance with moderating effect of Spiritual Intelligence

The purpose of this study is to present an analysis on the impact of the organizational factors such as abusive supervision, Ostracism and work place bullying on the performance of and employee. We have also tested the moderating impact of the spiritual intelligence on the relationship between these organizational factors and the employee performance. The survey was conducted in the banking sector of Pakistan. Questionnaire distribution method was used to conduct this research. The total numbers of respondents were 365 in which the respondents were professionals belonging to different banks. The findings of this research paper indicate that due to the presence of factors such as employees get demotivated and their performance lowers down. But if they have high spiritual intelligence their experiences can be enhanced at their work place. This paper encourages the companies that they should on the development and promotion of the spiritual intelligence and policies that support employees to change work attitudes.

Impact of Perceived Organizational Support, Servant Leadership, Creative Self-Efficacy, and Conscientiousness on Job Boredom Via Job Crafting: A Study on Banking Sector of Pakistan

The feeling of job boredom can impede employees’ performances but it can be improved through engaging them in job crafting activities. It is important to understand the concept of job boredom because it can lead to many negative consequences at the work place. The study attempted to investigate the impact of perceived organizational support, servant leadership, creative self-efficacy, and conscientiousness on job boredom through the mediating effect of job crafting. Data has been collected from 450 employees of Punjab and Sindh working in banking sector of Pakistan through questionnaires. The data is analyzed with the help of SPSS 22 and Smart PLS 3. The findings reveal that there is significant and positive impact of perceived organizational support, servant leadership, creative self-efficacy, and conscientiousness on job crafting. Additionally, job crafting has significant and negative impact on job boredom. However, job crafting also significantly mediate between perceived organizational support, servant leadership, creative self-efficacy, conscientiousness, and job boredom. Moreover, the study also suggests that future researchers can explore other outcomes of job crafting through which job boredom can be mitigated.

UNDERSTANDING NARCISSISTS’ KNOWLEDGE HIDING BEHAVIOUR: A MORAL DISENGAGEMENT MECHANISM PERSPECTIVE

Purpose: Narcissistic people have a strong desire to hold focus only around themselves. Their self-love triggers them to create their monopoly and involve in deviant behavioral outcomes such as knowledge hiding. This study was aimed to examine narcissistic employees’ tendency of knowledge hiding behavior in the presence of underlying mechanisms: moral disengagement as mediator. Methodology: The Data were collected from banking sector professionals using a Likert scale questionnaire based on time-lagged (three rounds, one month apart) survey. Data were analyzed via Partial Least Squares Structural Equation Modeling (PLS-SEM) using an advanced version of Smart PLS 3.9 and SPSS 21. Findings: Results revealed that narcissism has a significant positive relation with knowledge hiding and also established moral disengagement as an underlying mechanism between the positive association of narcissism and knowledge hiding. The results provide important recommendations for managers to handle narcissistic personalities and knowledge hiding issues in the banking sector of Pakistan. Conclusion: Despite the limitations, the present study enhanced the current knowledge on narcissistic personality features through the moral disengagement perspective with knowledge hiding and enriching the validation of the social cognitive theory. The study results conclude that the banking sector of Pakistan must consider the narcissistic personality of employees behind their issue of knowledge hiding.

Managing Diversity Through Leadership and Emotional Intelligence in the Banking Sector of Pakistan: A Moderating Role of Organizational Culture

The moderation effect of organizational culture has also been examined. The quantitative approach has been used in data collection, and 182 sample responses have been gathered from the banking industry employees of Pakistan. The data has been analyzed by employing PLS-SEM. The results have shown that transformational and transactional leadership positively and insignificant affect workplace diversity. However, emotional intelligence has a positive and significant effect on workplace diversity. Besides, organizational culture has a positive and significant moderation effect between transactional leadership and workplace diversity. The organizational culture has a negative but insignificant moderation effect between transformational leadership and workplace diversity. The organizational culture has a negative but insignificant moderation effect between emotional intelligence and diversity. Managers are recommended to ensure transparency when identifying roles and expectations of the task amongst employees. Secondly, establish reward systems upon effective outcomes. Thirdly, state the punishments with utmost clarity.

Morality impels employees to act: examining how ethical leaders urge employees towards knowledge sharing

ABSTRACT This study investigates when leaders can promote knowledge sharing by leading ethically? Drawing on social learning theory, we hypothesise that ethical leaders can induce knowledge sharing via role modelling. Moreover, social exchange and social capital theories explain that organisational citizenship behaviour (OCB) and normative commitment (NC) can boost knowledge sharing among employees through dual mediating effects. We collected two waves data from 506 manager-employee dyads in the banking sector of Pakistan. In addition, structural equation modelling was used to test the model, and bootstrapping was applied to examine the mediation effect. Results show that ethical leadership is positively related to employee knowledge sharing and this relationship is significantly mediated by OCB and NC parallelly. Both are equally important in accounting for the impact of ethical leadership on employee’s knowledge sharing. Our research suggests that ethical leaders can promote knowledge sharing by increasing OCB and engendering NC.

E-banking Customer Satisfaction and Loyalty: Evidence from Serial Mediation through Modified E-S-QUAL Model and Second-Order PLS-SEM

This research aims to measure the service quality of e-banking through e-customer satisfaction & e-customer loyalty in the Islamic e-banking sector of Pakistan. For this purpose, we modified the multiple-item scale (E-S-QUAL) model with two new dimensions: availability of online system and personal needs of customers. Additionally, we added two mediators, for instance, religiosity and trust in the Islamic e-banking perspective. We have collected 674 responses from the consumers of the Islamic banking sector of Pakistan through a structured questionnaire. The data were analysed through second-order PLS-SEM (PLS-structural equation modeling) to examine direct and serial mediation. The direct relationship results showed a positive and compelling effect of modified E-S-QUAL dimensions on e-customer satisfaction. Additionally, the e-customer satisfaction has an affirmative and significant association with e-customer loyalty. Moreover, the serial mediation relationship results exhibited that the e-customer satisfaction, trust, and religiosity mediated the modified dimensions of the E-S-QUAL model and e-customer loyalty.

Critical Role of Risk Management and its Impact on Bank Performance in Pakistan

Risk management is most important factor to exist and survive for the financial industry. The major bankruptcies which incurred of ERON and Lehman-Brothers this arises the awareness about the appropriate risk management procedure in banking sectors. Our study analyze the various risk which can affect on banking operation in Pakistan and this study also include the effect of risk management on the performance of the large banking sector as well as small banking sectors in Pakistan. This study uses capital adequacy ratio, non performing loans, interest rate risk, liquidity risk and operational risk for the risk management. The data is taken from the published annual report of the commercial banks from 2005 to 2015. Descriptive statistics, correlation matrix and regression analysis use to analyze the data. This study leads to conclusion is that the better risk management system leads to the better performance of the banks. It’s also conclude that capital adequacy ratio, non performing loans, interest rate risk, liquidity risk and operational risk that are key drivers of the profitability for the large banking sector of Pakistan. It’s also tell us that only capital adequacy ratio and non performing loans are the key drivers of small banking sectors in Pakistan.

What Determines Price-to-Earnings Ratios: An Empirical Evidence from Banking Sector of Pakistan

It is of greater importance to understand the factors influencing P/E ratio for the fund managers, decision makers, market analysts and individual investors. Variability in shares prices and investment opportunities in Pakistani listed banking firms motivate to examine the determinants of P/E ratio using time-series as well as panel data analysis for the period of 2007 to 2014. The findings of panel data indicate significant variation in P/E ratio due to MktRtrn, VMP and SIZE. DP ratio is found to be the most influential determinant of P/E ratio indicating the willingness of investors to invest more funds in those banking firms paying greater dividends. Empirical outcomes of time-series analysis for banking industry represent that DP ratio is the super most imperative determinant of P/E ratio. Findings also indicate that P/E ratio vary across years and influence the investor’s investment decision. The findings of the study facilitate the decision makers by investigating the most significant determinant of P/E ratio of banking firms in order to attract attention of investors and increase their confidence to choose these firms in their portfolios.

Performance of Banks in Pakistan based on determinants of Profitability

The study aims to seek the internal factors that affect the profitability of banks in Pakistan from a period of 2009 to 2013 by using two proxies i.e. Return on Assets (ROA) and Return on Equity (ROE). The panel data of fifteen banks have been obtained from the financial statements of the banks. Therefore, Hausman test has verified that random effect model is most appropriate model for Return on Assets (ROA), conversely fixed effect model is prominent for Return on Equity (ROE) for the current study. The empirical results confirm that investment to total assets, leverage, Net Performing Loan (NPL) to gross advances, capital ratio and total deposits to total equity are the main determinants of profitability across both proxies (i.e. ROA and ROE). Leverage and capital ratio have significantly negative, however net performing loan to gross advance and total deposit to total equity have significantly positive influence on profitability of banks across both models. Moreover, NPL to gross advance is insignificant determinant of Return on Equity. The results are worthy for bankers and all stakeholders to make strategic decision for the competitiveness of banking sector in Pakistan.

Does Better Brand Management Influences Consumer Purchase Decisions? Covid-19 Challenges from Pakistan Banking Sector

Banking Sector (BS) is facing more enormous challenges due to the quick spread of NOVEL COVID-19, which locked people's lives over the globe. Brand management is one of the critical concerns. Organizations are managing their brand to attract potential customers from the market in this pandemic situation. For this objective, data have been collected from 210 customers of banking organizations. Data have been gathered using a snowball sampling method, which allows the respondents to spread the questionnaire link with their friends; this study has used SPSS to analyze the data. However, the findings of the study have portrayed that brand management substantially influences consumer purchase behavior. Therefore, whenever organizations develop their strategies to attract potential customers, organizations can increase brand performance by efficiently managing it. Moreover, when customers link with the brand, they use it to learn about customer service and corporate bank strategies.

Making Leaders’ and Followers’ Relationship Sustainable: The Impact of Leaders’ Behavioral Integrity on Employees’ Voice in the Banking Sector of Pakistan

The behavioural integrity of leaders is not only an individual trait that can earn them respect in their personal capacity, but it also may positively affect their followers and ultimately improve the organization’s effectiveness in a variety of ways. The relationship between behavioural integrity and employees using their voice has been studied by researchers through multiple aspects. This study brings a new perspective in this discussion by investigating the effect of leaders’ behavioural integrity on employees’ voice both directly and through the mediating roles of psychological safety and trust in the leader. The cross-sectional data of 384 employees collected from the banking sector in Pakistan is used to shed light on this new perspective in the relationship between the behavioural integrity of a leader and employees’ comportment in using their voice. The results of the empirical analyses support the direct effect of the behavioural integrity of leaders on employees’ voice. A significant mediating role of psychological safety and trust is also supported in the empirical analyses. The findings of the study bear important implications for leaders and business managers working in companies by providing insight on the importance of behavioural integrity of leaders in encouraging employees to have a voice in organizations.

Impact of transformational leadership and transparent communication on employee openness to change: mediating role of employee organization trust and moderated role of change-related self-efficacy

PurposeThis study investigates the impact of transformational leadership and transparent communication on employees' openness to change with the mediating role of employee organization trust and moderating effects of change-related self-efficacy.Design/methodology/approachA sample of 260 employees from banking sector of Pakistan through self-administrated questionnaire participated in this study and the data was analysed through partial least square structural equation modelling (PLS-SEM).FindingsThe results reveal that transformational leadership and transparent communication help to create trust among employees of the organization which ultimately have positive effects on employee openness to change. Further, the results suggest that the presence of change-related self-efficacy significantly moderates relation between the transformational leadership and employee openness to change. However, change self-efficacy does not change the relationship between transparent communication and employee openness to change.Research limitations/implicationsThis study contributes to change management literature and helps organizations to understand the importance of employees and their positive behaviour during change.Practical implicationsThe researcher provides the guidelines for employers to craft change communication policy during the change implementation phase.Originality/valueThis study tests a mediating role of employee organization trust and moderating role of change-related self-efficacy in relation with transformational leadership and transparent communication on employees' openness to change which had not been tested theoretically and empirically in the context of Pakistan.

Organizational Performance in Banking Sector of Pakistan: Assessing the Impacts of Strategic Orientation and Organizational Culture

This study investigated the moderating effect of organizational culture on the relationships between organizational strategic orientation and organizational performance. Data were collected from 281 middle managers of the banking sector in Pakistan. Partial least squares structural equation modelling (PLS-SEM) was used to test the hypotheses. The results showed that strategic orientation and organizational culture have significant and positive impacts on the performance of the organization. Unexpectedly, organizational culture does not moderate the relationships between strategic orientation and performance. The findings of the study show that organizations that are strategically positioned as well as have a strong culture can be high-performing organizations. As there is a clear lack of research on the moderating effect of culture on the relationships between an organization’s strategic orientation and organizational performance, the current study fills this gap. Likewise, the present study highlights both practical and theoretical implications for the banking sector in Pakistan.

Impact of M-Banking Service Quality on Customer Satisfaction with the Role of Trust and Customer Value Co-Creation Intentions

This paper investigates the impact of various dimensions of mobile banking service quality on customer satisfaction with the mediating role of customer value co-creation intentions in the banking sector of Pakistan. Theoretical foundations of this study lie in the Technology Acceptance Model (TAM) and Service-Dominant (S-D) logic. Data was collected using a questionnaire from a sample of 383 respondents from 25 banks. Mediation and moderation analyses were conducted to explore the role of trust in creating customer satisfaction through the mediating role of customer value co-creation. The findings showed that m-banking service quality dimensions have a significant impact on customer satisfaction. Also, it was found that co-creation has a significant impact on customer satisfaction. Mediation analysis was conducted to see if co-creation mediates the relationship between m-banking service quality and customer satisfaction. There was found to be partial mediation between all dimensions of m-banking service quality and customer satisfaction. Moderation analysis was also conducted to check the role of trust. The findings revealed that trust moderates the relationship for only perceived ease of use of m-banking; however, trust doesn’t moderate the relationship for other dimensions of m-banking. This study will be beneficial for bank managers to adopt the strategies that help in co-creation by customers and hence enhance customer satisfaction in the existing competition for better services. This study will add to the existing literature by its novel findings and knowledge in the extended technology acceptance model.

Organizational and Personal Drivers of the Financial Sector: A Focus Group of Banking Officials in Pakistan

Purpose: This study intends to explore the key challenges the financial sector faces today about employees’ perspectives and how these challenges eventually play a role in the employee’s work-life balance.
 Design/Methodology/Approach: A Focus group was conducted with a leading multinational bank in Pakistan. Six managerial cadre employees participated in the focus group study. The focus group analysis suggests very stringent rules and regulations incorporated by SBP that bind each bank to undergo strict compliance.
 Findings: The challenge of customer retention, declining interest rates, coping with the frugal economic situation of the country, meeting customer satisfaction, incorporating personal relationship management, use of ancillary support services by customers, reward and recognition to employees, dealing with information savvy knowledgeable customers, work-life balance and overall motivation of the bank employees are assumed by the participants as the key challenges that drive the banking industry of Pakistan.
 Implications/Originality/Value: Senior management of the banking sector of Pakistan can learn from the problems discussed, and the possible solution proposed to the said problems. This research contributes to the body of knowledge while explaining the issues faced by the professionals working in the banking sector of Pakistan.

Corporate Social Responsibility and Firm’s Financial Performance: Evidence from the Banking Industry of Pakistan

The present work examines the effects of corporate social responsibility on profitability (CSR) of banking sector of Pakistan. The existing literature mainly focused on manufacturing industry of developed countries, while this study investigating the impact of CSR on financial sector of Pakistan. Secondary data were collected from 15 different banks from their annual reports for the period 2007-2016. Furthermore, study used summary statistics and two step system GMM to analyse the impact of corporate social responsibility on the financial performance of banks and found significant positive impact of CSR on financial sector performance. Moreover, the present work also observe that banks with good history of CSR spends less at present as they have established good reputation in society. Our study provides important empirical insights for regulators and other key stakeholders especially State Bank of Pakistan and banking industry of Pakistan for improvement in firm performance and profitability.