Jordanian Banks Research Articles

The Impact of Intellectual Capital on Competitive Advantage The Case of the Jordanian Banking Industry

The Impact of Intellectual Capital on Competitive Advantage The Case of the Jordanian Banking Industry

The impact of leadership styles on marketing effectiveness and financial performance in Jordanian banks sectors: Corporate social responsibility as a mediator

Human abilities are the primary factors that define the path of the corporation's improvement; these capabilities can be improved via training, experience, education, and innovation. Therefore, the current study delves into the impact of different leadership styles on marketing effectiveness and corporate financial performance through the role of corporate social responsibility as a mediator by utilizing a Partial Least Squares Structural Equation Modeling (PLS-SEM) to research 100 managers in 2023 in Jordanian banking sectors. The result of this study has shown a significant and positive relationship between leadership styles, marketing effectiveness, and financial performance. Furthermore, social responsibility, which is the mediator of the study, shows a significant role in the connection between leadership styles and marketing effectiveness as well as financial performance in banks. Minutely, this study found that transformational style promotes an innovation culture and inspires employees in the banking sector, in other words, this style of leadership emphasizes corporate social responsibility programs that support the bank and society's objectives.

Factors Affecting E-Banking Service in Jordanian Commercial Banks

This study aimed to determine the variables influencing electronic banking services in Jordanian commercial banks. The study sample consisted of 13 commercial banks, according to the study’s variables. The descriptive and analytical approach and other statistical techniques were employed, including the fixed effect test and descriptive statistics. No statistically significant impact at the level was found, according to the findings of significance (p < 0.05) for total assets on electronic banking services, and there is no statistically significant impact at the level of significance (p < 0.05) for total capital and provisions, total credit facilities, and total deposits on commercial banks in Jordan that offer electronic banking. The study recommended that the banking sector focuses on all the main elements related to electronic banking services by comparing traditional banking services with electronic banking services, knowing the factors affecting that, and paying attention to them to raise the profitability level.

The Extent of Using Information Technology in Internal Auditing and The Differences in Its Use in Jordanian Banks

The Extent of Using Information Technology in Internal Auditing and The Differences in Its Use in Jordanian Banks

The role of financial accounting technology in improving customer relationship management in Jordanian banks

The role of financial accounting technology in improving customer relationship management in Jordanian banks

The Risks of Using Financial Technology on the Jordanian Islamic Banking Sector

The current study aimed to investigate the impact of the risks associated with the use of financial technology on the Islamic banking sector in Jordan. The researcher adopted a descriptive-analytical approach by referring to previous studies and scientific journals. The researcher developed a study tool, a questionnaire, that was tailored to the study's objectives. The study's population consisted of administrative employees in Islamic banks, numbering approximately 4,094 employees. The study sample was drawn from employees in the northern region of Jordan, with 218 questionnaires distributed and 206 questionnaires returned. After reviewing the questionnaires, it was found that 6 questionnaires were not valid for statistical analysis. Among the study's key findings, there was a statistically significant impact of the risks associated with various types of financial technology (lack of knowledge, operating systems, information security) at a significant level (α≤0.05) on the Islamic banking sector in Jordan. The results also indicated a good level of financial technology application in Islamic banks in Jordan. One of the main recommendations from the study is the necessity to develop banking regulatory and supervisory frameworks to keep pace with advancements in modern financial technology models. This can be achieved by utilizing regulatory technology and striking a balance between promoting competition and financial innovations, while ensuring the stability of the banking sector.

The relationship between profitability and cash flow in Jordanian banks

The relevance of this study lies in the importance of the two variables – profitability and cash flow – for the financial performance of banks, as well as the unique characteristics of the Jordanian banking sector. The purpose of the study is to investigate whether there is a significant relationship between profitability and cash flow in Jordanian banks and to identify potential factors that influence this relationship. The study methods are to employ a quantitative research method, using financial data from Jordanian banks over a period (2008–2019), Granger causality tests are used to describe the link between cash flow and profitability. The study results show a significant link between profitability and cash flow in Jordanian banks. Specifically, the study finds that a one percent increase in cash flow results in a 0.27 percent increase in profitability. The Adj-R2 for the three cash flow models is 11.4%, 17.3%, and 20.4%, respectively. Conversely, the Adj-R2 for the three models’ earnings are 21.4%, 21.5%, and 22.3%, respectively. However, the magnitude of the link seems to be weaker in Jordanian banks compared to banks in other countries. The study concludes that cash flow from operating is an important factor in improving the profitability of Jordanian banks.

Corporate governance components and intellectual capital: Evidence from Jordanian banks

This study investigates the impact of corporate governance components on intellectual capital performance in Jordanian banks. The research purpose is to gain insights into the relationship between various corporate governance components, including board size, board independence, CEO duality, and concentration of ownership, and their influence on intellectual capital efficiency. Ordinary Least Squares regression analysis is employed using data from 156 Jordanian banks by adding two control variables, total assets, and return on equity (ROE) to explore their potential influence. The obtained results reveal significant associations between certain corporate governance factors and intellectual capital efficiency. Ownership concentration demonstrates a direct and statistically relationship with IC performance, indicating that more concentrated ownership leads to improved management and utilization of intellectual capital resources. Additionally, return on equity shows a significant positive correlation with intellectual capital efficiency (Adj R2 was 22.5%). However, the study does not find significant relationships between board size, Chief Executive Officer (CEO) duality, and board independence with intellectual capital efficiency in Jordanian banks. These results suggest that the impact of these governance factors on IC performance may be more context-dependent and nuanced within the banking industry.

An Empirical Study on the Impacts of the Fourth Industrial Revolution Technologies on Internal Audit in Jordanian Banks

An Empirical Study on the Impacts of the Fourth Industrial Revolution Technologies on Internal Audit in Jordanian Banks

أثر الامتثال على الحوكمة الشرعية في المصارف الإسلامية THE IMPACT OF COMPLIANCE ON SHARIA GOVERNANCE IN ISLAMIC BANKS

The study aims to identify the impact of compliance on Sharia governance in Islamic banks in Libya and Jordan. To achieve the objectives of the study, the research model is designed based on previous studies on the relationship between the research variables. The study sample includes a number of employees of Islamic banks in Libya and Jordan. Based on the quantitative approach in this research, all variables were tested by way of the SPSS application and the AMOS statistical software package. Out of 225 copies, (204) samples were collected from the employees of these banks whereby 21 questionnaires were excluded. The study has reached some findings, the most important of which is that there is a statistically significant effect of compliance on Sharia governance in Islamic banks in Libya and Jordan at a significant level of 0.05. It is also clear that the strength of the correlation is high, indicated by the high level of confidence and the high level of assumption amounting to 0.745. The findings also indicate the positive trend of this relationship, that is, compliance is directly proportional to the Sharia governance of the employees of Islamic banks in Libya and Jordan. The study also suggests some recommendations, the most important of which are: That banks should have a general and clear guide and framework for the principles of Sharia governance, and for compliance with laws and Sharia in addition to clearly defining functions. The study advises Islamic banks to deliberate on compliance by adopting and developing compliance functions and establishing an effective management system to evaluate compliance.

The Impact of Board Diversity on the Relationship Between Shareholders Wealth and Un-Compulsory Disclosure in Jordanian Commercial Banks

Purpose: This study aims to examine the association between un-compulsory disclosure and shareholders wealth among Jordanian banks. Moreover, it investigates the effect of the board diversity on the relationship between un-compulsory disclosure and shareholders wealth. Theoretical framework: Prior studies have reported that board diversity plays an important role in taking decisions like disclosing more information or distributing earnings. Despite the importance of board diversity, there is no study used as moderating variable to investigate the relationship between un-compulsory disclosure and shareholders wealth. Design/methodology/approach: This study covers all commercial banks listed on Amman Bursa. It has used checklist instrument to measure the level of un-compulsory disclosure; return on equity and market value to measure shareholders wealth; and board nationality and female on board of directors to measure the diversity. Hierarchical regression analysis was used to achieve the objectives. Findings: The findings show that banks with high shareholders wealth are more likely to reveal un-compulsory information to help stakeholders. Furthermore, this study provides creative evidence that female members play a main role as moderating variable that influence management motivations toward practices of un-compulsory disclosure and shareholders wealth. Research, Practical & Social implications: This study suggests that regulatory bodies issue and develop the current code about the diversity of the board, especially more female representation on boards. Originality/value: this study provides creative evidence that female members play a main role as moderating variable that influence management motivations toward practices of un-compulsory disclosure and shareholders wealth.

The Effect of Real Exchange Rate on Current Account

This research studies the impact of real Gross Domestic Production (GDP) and real exchange rate on the Current Account position in Jordan, during the quarterly periods from 2008 to 2022. The study reviews the literature on the theoretical framework around the impact of real GDP and fluctuations of the real exchange rate on the current account status. This study describes the performance of the current account during the study period and applies the appropriate econometric tests to an economic model. The main results show a significant, positive effect of real GDP growth in improving the status and sustainability of the current account; output growth indicates an increase in production leading to higher levels of exports and lower levels of imports. The results did not show a significant effect of the real exchange rate on the current account position, which is largely attributed to the stabilization policy of exchange rate pursued by the Central Bank of Jordan since October 1995.

The Impact of Financial Technology on Customer Behavior in the Jordanian Commercial Banks

This study investigated impact of financial technology on customer behavior in Jordanian commercial banks. The descriptive technique was employed based on the study of the research topic. The study population consisted of all administrative workers in Jordanian commercial banks. The data was collected through a random sample of administrative workers in Jordanian commercial banks, estimated at 300 male and female employees. The statistical package for the social sciences program was used to examine the data after obtaining it using the questionnaire (SPSS). The results showed that there is a statistically significant positive effect of financial technology (credit service, payment services, investment management services, financial market support services) on customer behavior in Jordanian banks, which indicates that (financial technology) explained an amount (84.1%) of the change in customer behavior in Jordanian banks. Banking will unquestionably concentrate on delivering financial services through data in the future, limiting the ability to react. By enhancing the promise of value, financial institutions that have been able to quickly adapt to financial innovations boost client loyalty and happiness. The study recommends that Jordanian banks, in light of global competitiveness and the global trend towards digital transformation, follow the financial technology approach and make the most of the opportunities and advantages offered by digitization to banks in order to preserve their customers and compete. The study also recommended researchers and those interested in banking studies expand their research on financial technology due to the relative lack of studies covering the subject.

Identifying Monetary Policy Under Fixed Exchange Rates in a Small Open Economy

Purpose: This paper is an empirical investigation of the transmission of monetary policy in a small open economy with fixed exchange rates. The paper argues that under a fixed exchange rate system and free mobility of capital, the ability of monetary policy actions to affect the real variables of the economy is limited and constrained by maintaining the peg. Theoretical framework: The study's theoretical framework examines how Jordan's monetary policy, influenced by a fixed exchange rate with the U.S. dollar, responds to domestic and external shocks, with an emphasis on the transmission of these shocks through key economic variables. Design/Methodology/Approach: A two-country structural macroeconomic model has been developed to describe the small economy that explicitly incorporates an interest rate differential. Findings: Using Jordan as a case study during the period when its currency was pegged to the U.S. dollar, vector auto-regression analysis reveals that there is evidence of a strong U.S. monetary policy influence on the Jordanian economy. The results show that adjustment of the policy rate by the central bank of Jordan in response to Federal Reserve actions has no significant impact on output while the interest rate differentials tend to have an immediate influence on inflation with short lags, albeit small in magnitude. Research, Practical & Social implications: The research provides insights that can inform effective monetary policy strategies in small open economies like Jordan, offering implications for policymakers and contributing to economic stability. Originality/Value: The originality of this study lies in its comprehensive analysis of Jordan's monetary policy within the context of a small open economy, offering valuable insights into the effects of external shocks, exchange rate regimes, and policy responses on key economic variables.

CAN PERFORMANCE-BASED REWARDS AND DEVELOPMENTAL PERFORMANCE APPRAISAL DRIVE RADICAL INNOVATION? THE MEDIATING EFFECT OF INNOVATIVE WORK BEHAVIOUR AND AFFECTIVE COMMITMENT

The aim of this paper is to empirically study the impact of the motivation-enhancing practices of performance-based rewards and developmental performance appraisal on radical innovation. The effect of innovative work behaviour (IWB) is also considered as a mediator in this relationship. The paper also considers the effect of performance-based rewards and developmental performance appraisal on affective commitment and whether this mechanism can drive employees’ IWB. A survey questionnaire was used to collect data from employees working in the telecommunications, mining, pharmaceutical, banking and technological industries in Jordan. The final sample comprised 270 valid responses. Research hypotheses were tested via structural equation modelling (SEM) using AMOS v28 and PROCESS by Hayes to test the mediating effects. The paper found that IWB mediates the relationship between performance-based rewards, developmental performance appraisal and radical innovation because the subsequent effect of IWB on radical innovation was significant and positive. This is also confirmed by the mediation analysis. Findings showed support for the positive impact of performance-based rewards and developmental performance appraisal on affective commitment. Additionally, the findings confirmed that affective commitment mediates the relationship between performance-based rewards, developmental performance appraisal and IWB.

Does public debt impede financial development in Jordan Some macro and micro analysis

Purpose- It is acknowledged that banks offer their respective economies a number of services, including the encouragement of savings and allocation of capital to the private and public sectors. Within this context, and given that public debt in Jordan has been increasing at an alarming rate, this paper sets out to answer two questions: First, what is the impact of local public debt on aggregate credit to the private sector? Second, what is the impact of local public debt on bank-level credit to the private sector? Methodology- To provide an answer to the first question, the paper uses annual data (1982 – 2021) on aggregate bank credit to the private sector, aggregate bank credit to the government, and the discount rate. The applied techniques include stationarity test, optimal lag structure, co-integration, and vector error-correction (VECM) estimation. To answer the second question, the paper uses annual bank level data (2010 – 2021) for all 13 listed Jordanian banks. The fact that this data includes both time series and cross-section elements, panel data analysis is used to measure the impact of bank-level credit to the government on bank-level credit to the private sector. Findings- At the macro level, the results show that bank credit to the government (bank holdings of government securities) has a significant and negative impact of bank credit to the private sector. At the micro level, the results also show that bank-level lending to the government does affect (negatively) their credit to the private sector. Conclusion- The results of this paper are not encouraging. Indeed, they indicate that public debt impedes credit to the private sector. The government should look at the status of its public finance and work on reducing its borrowing. In addition, the government should look at the viability of establishing a secondary market for its issued securities. Keywords: Jordan, public debt, bank credit, diversification, time-series analysis, co-integration. JEL Codes: E50, E51, E52

The Impact of Marketing Financial Services on Value Behaviors Through Loyality and Satisfaction of Customer of Arab Bank in Jordan

The study aimed to know the relationship between marketing of financial services in public sector banks with special reference to Arab bank in Jordan. The analysis of the data acquired from the customers of the Arab bank in Jordan provides meaningful insights into Perceived financial service quality, Perceived financial service orientation, marketing mix strategy, customer satisfaction, customer loyalty and Value in behavior. Further, the research investigates the direct and indirect association among the study variables. The preliminary analysis discloses that the means of all the study variables. It was found that the Perceived financial service Quality and Marketing mix strategy has a significant positive association with Value in behavior. Further, Perceived Financial service quality has a positive significant association with customer satisfaction and customer loyalty in the Arab bank in Jordan. Additionally, Perceived financial service orientation has a positive significant relationship with customer satisfaction and customer loyalty. Further, a Marketing mix strategy has a positive significant relationship with customer satisfaction and customer loyalty. At last, customer satisfaction and customer loyalty have a positive significant relationship with Value in behavior. Further, it was found that perceived financial service orientation has a negative significant relationship with Value in behavior. Besides, Customer satisfaction and Customer loyalty partially mediate the relationship between Perceived financial service quality and Value in behavior. Likewise, Customer satisfaction and customer loyalty cannot mediate the relationship between Perceived financial service orientation and Value in behavior because hypothesis is rejected. Therefore. Finally, Customer satisfaction and Customer loyalty partially mediate the relationship between Marketing mix strategy and Value in behavior were partially supported.

Enhancing Accounting Disclosure Through Entrepreneurship Strategy in Banking Sector

Purpose: This study aims to examine the role of adopting an entrepreneurship strategy in enhancing accounting disclosure in Banking Sector in Jordan. Methodology: To achieve the study's objective, a questionnaire was designed and distributed to a random sample of 130 respondents, consisting of managers and employees in the financial departments of Jordanian banks. After conducting statistical analysis using the SPSS statistical package. The study focuses on several dimensions, including financial statements, accompanying disclosures in financial reports, the quality of accounting information that should be disclosed, transparency in accounting disclosure, and meeting the requirements of the central bank. Findings: The study found that adopting an entrepreneurship strategy in Jordanian banks contributes to enhancing the quality of preparing and presenting the core financial statements, such as the income statement, balance sheet, statement of changes in equity, and statement of cash flows. It also enhances the quality of accompanying disclosures in financial reports, improves the quality of accounting information, increases transparency in accounting disclosure, and enhances the ability to quickly and accurately meet the requirements of the central bank. Social implications: The study made several recommendations, including the central bank adopting an entrepreneurial culture as a method and approach and encouraging banks to follow the same approach to support entrepreneurship and innovation. Originality/Value: The results indicate that banks develop a system to incentivize creative employees and conduct training courses to familiarize bank employees with the concepts of entrepreneurship, innovation, and their importance in banking.

التكلفة التاريخية مقابل القيمة العادلة وتأثيرها على جودة الأرباح

The controversy has increased recently between supporters of the historical cost model and supporters of the fair value model as a basis for measurement in accounting, by comparing the priorities of the characteristics that should be available in the accounting information. Since the accuracy and validity of this information depends on the validity, appropriateness, and reliability of the measurement alternatives on which it was based to access this information. In this research, we will address the two accounting alternatives, the historical cost, and the fair value, and compare the impact of each on the quality of profits in the Jordanian banking sector. The historical cost that represents the actual reality of the event at the time of its occurrence at the moment of exchange is undoubtedly correct or accurate at the moment of acquisition or ownership, but the recorded value may become a thing of the past as it deviates slightly or a lot from the current value. The results of the field study indicated that fair value provides information that is highly suitable for decision-making and is comparable to accounting information in the Jordanian banking sector.

The Role of E-Banking Services in Achieving Competitive Advantage - Foreign Banks in Jordan

The purpose of the research is to identify the role of E-banking services in achieving competitive advantage. The study used descriptive and analytical methods. The target population in this study was top management - managers, directors, and heads of departments in foreign commercial banks of Jordan. A random sampling method was applied for the data collection using a five-Likert scale questionnaire. The study used different statistical methods to test hypotheses such as simple and multiple regressions. The study findings revealed that there is an impact of ATM, mobile banking, E-banking, electronic credit, and short message services in achieving competitive advantage. Finally, the study formulated recommendations for foreign commercial banks to offer more electronic services and to utilize technology to attract more customers.