Pakistani Banking Sector Research Articles

Authentic leadership – a source of tacit knowledge sharing and career competence in service sector

PurposeThis study aimed to examine the correlation between authentic leadership and career competence, exploring the mediating roles of tacit knowledge sharing and employee service innovative behavior.Design/methodology/approachData were collected using convenience sampling and a time-lagged design from the Pakistani banking sector. The time-lagged design was employed to gather data at two different points in time. SPSS statistical software was used for descriptive analysis, and hypotheses were tested using Mplus.FindingsThe results demonstrate that authentic leadership has a significant positive impact on tacit knowledge sharing. This knowledge sharing, in turn, positively impacts employee service innovative behavior, which subsequently enhances career competence. Furthermore, tacit knowledge sharing mediates the relationship between authentic leadership and employee service innovative behavior.Social implicationsThis study has social implications for organizations aiming to align their inclusive goals with societal needs. The findings can help foster a culture of knowledge sharing, thereby contributing to societal innovation.Originality/valueThis study provides valuable insights into how authentic leadership contributes to career competence, thus enriching the existing literature on this topic.

Leadership Styles and Relationship Conflict in Pakistani Banks: Exploring the Moderating Roles of Trust, Emotion, and Clarity

This study aims to explore the moderating impacts of cognitive trust, emotion regulation, and role clarity on the relationship between different leadership styles—transformational, transactional, and laissez-faire—and relationship conflict within the Pakistani banking sector. The objective is to understand how these moderating variables influence the dynamics between leadership approaches and interpersonal conflicts in a high-stress, compliance-driven environment. A quantitative research design was employed, targeting non-managerial staff across five major private banks in Pakistan. Data were collected through a self-administered survey using both digital and printed questionnaires. The survey assessed various constructs, including leadership styles, relationship conflict, cognitive trust, emotion regulation, and role clarity. SmartPLS 4 software was used to evaluate the measurement model and to test the hypothesized interactions between the variables. The analysis revealed that cognitive trust significantly moderated the relationship between transformational leadership and relationship conflict, suggesting that higher levels of trust can reduce conflicts in transformational leadership contexts. However, cognitive trust did not significantly moderate the effects of transactional and laissez-faire leadership on relationship conflict. Role clarity was found to be a critical moderating factor, effectively reducing relationship conflict across all three leadership styles, indicating its importance in providing clear expectations and reducing ambiguity in the workplace. Emotion regulation also played a significant moderating role in both transformational and transactional leadership, helping to mitigate relationship conflicts. However, it did not significantly moderate the relationship between laissez-faire leadership and relationship conflict. The findings underscore the importance of fostering cognitive trust, enhancing emotion regulation skills, and ensuring role clarity in organizational settings, particularly within the banking sector. By focusing on these moderating factors, organizations can better manage the adverse effects of different leadership styles on relationship conflicts, thereby improving overall team cohesion and productivity. This study provides valuable insights into the complex interplay between leadership styles and relationship conflict in a culturally specific context. It highlights the critical roles of cognitive trust, emotion regulation, and role clarity as moderating factors that can enhance leadership effectiveness and conflict management in the Pakistani banking sector.

Determinants of Bank’s Financial Stability in Pakistan

The purpose of this study is to investigate the role of both internal and external factors in achieving better stability in context of Pakistani banking industry. The internal determinants that this research study have used are bank size, funding risk, liquidity risk, credit risk and return on assets while external variables utilized includes money supply and unemployment rate. The study contains 10 years secondary data over the period 2013-2022 of 24 commercial banks of Pakistan. This study conducted correlation analysis and GMM model estimation for analysis. The findings show that liquidity risk, bank profitability, funding risk and bank size have positive and significant impact on bank stability. On the other hand, credit risk effects negatively bank stability. The result showed that money supply positively affects the stability of banks in Pakistan. On the contrary, unemployment is negatively affecting banks stability. The findings of this study have important implications for policymakers, regulators, banks, investors, and other stakeholders in the Pakistani banking sector. By enhancing the understanding of the factors influencing bank stability, the research contributes to identifying the importance of development of evidence-based policies, risk management strategies, and regulatory reforms aimed at development of a stable and resilient banking system in Pakistan.

Implications of corporate social responsibility on the financial and non-financial performance of the banking sector: A moderated and mediated mechanism

This study aims to investigate the influence of corporate social responsibility (CSR) on both financial and non-financial performance in the Pakistani banking sector by applying a quantitative research approach to the primary data from 405 branch managers in the Pakistani banking sector. Both financial and non-financial performance indicators are analyzed in relation to CSR practices. The CB-SEM findings of this study reveal a significant and positive correlation between CSR and both financial and non-financial performance. Our results demonstrate that CSR initiatives contribute to improved financial performance, reputation, and innovation within the sector. These findings confirm the importance of prioritizing social responsibility initiatives to enhance overall performance in the banking industry. This study provides valuable insights into the impact of CSR on performance in the context of the Pakistani banking sector. The research contributes to the existing literature by highlighting the positive relationship between CSR and financial/non-financial performance. The findings underscore the relevance of CSR practices for banks in Pakistan and emphasize the potential benefits of incorporating social responsibility initiatives into their operations. This study serves as a foundation for future research, encouraging further exploration of CSR's role in the banking industry and its implications for sustainable business practices.

Impact of fintech on the Pakistani banking sector

In the early stages, Fintech was introduced in the banking sector in Pakistan, and it enhanced banking activities from traditional to digital. Fintech is the fusion of two terminologies, Finance and Technology. It includes the use of technological advancement to deliver financial products and services to people. This research aims to investigate and analyze the impact of Fintech adoption on the competitiveness and performance of the Pakistani banking sector. The research is based on quantitative methods and analyzed using SPSS software; we used the convenience sampling method to collect responses from 90 participants. This study uses a regression analysis model as a benchmark to analyze the data received from the questionnaire. The results suggest that Fintech adoption had a significant positive impact on the competitiveness and performance of the Pakistani banking sector. Adopting Fintech properly and lining up with technology can also improve the performance of a bank. This study allows for a more in-depth understanding of the impact of FinTech on banks.

Examining the Electronic Customer Satisfaction in Enhancing E-Customer Loyalty: A Case of Pakistani Banking Sector

The main objective of the current study is to examine e-customer loyalty in the Pakistani banking sector by combining the expectancy theory and incorporating the mediating impact of electronic customer satisfaction on the relationship between electronic customer loyalty, efficiency, user friendliness, responsiveness, and reliability. Data have been collected through a close-ended questionnaire for data collection from the consumers of Pakistan by using the survey method. A structured questionnaire-based quantitative research approach will be used to gather data. A significant portion of the questionnaires received was deemed suitable for in-depth analysis. 260 out of 300 submitted questionnaires were eligible for further examination, as 40 respondents partially filled in their responses. The SERVQUAL model examines e-customer loyalty in the Pakistani banking sector. Five hypotheses were made, and the results showed a positive impact, while the results did not support four mediating hypotheses. The study's conclusions offer a wide range of theoretical and practical recommendations for bank management that aim to improve the security and usability of online banking websites while fostering consumer loyalty and confidence. This study offers valuable insights to promote consumer confidence in online banking services.

The impact of cyberattacks awareness on customers’ trust and commitment: an empirical evidence from the Pakistani banking sector

PurposeThe banking industry has always been vulnerable to cyberattacks. In recent years, Pakistan’s banking sector experienced the most intense cyberattack in its over 70-year history. Due to these attacks, a large number of debit card accounts of major banks were negotiated. This study aims to examine the impact of cyberattack awareness and customers’ commitment levels after these cyberattacks.Design/methodology/approachThe study integrated the commitment–trust theory framework for the relationship of trust and commitment to the usage of online banking services. The partial least square structural equation modeling is being used to explore the relationship between customer’s trust, which is an outcome of continuous usage, and customer perception of affirmative cybersecurity measures the bank.FindingsThe findings revealed that customer trust in online banking is positively associated with customer commitment, but customers’ cyberattack awareness negatively impacts customer trust and commitment to online banking.Practical implicationsThe study highlights the importance of proactive communication, transparency and robust incident response that helps organizations establish themselves as trustworthy entities while prioritizing customer information and transaction protection.Originality/valueThe authors report on how cyberattacks on the banking sector influence the trust and commitment of the customers in the sector. The variable of cyberattack awareness used in this study is novel in online banking literature.

COVID-19 Precautions of Pakistani Banks in the Lens of Qualitative Study Approach

This research explores the precautions taken by the Pakistani banks listed in the Security Exchange Commission of Pakistan (SECP) to control the spread of the COVID-19 pandemic. The data was collected from the sample size of Pakistan's 23 Islamic and commercial banks during the pandemic period from 2020 to 2021. The study employs a qualitative research approach of the Pakistani banking sector through thematic analysis. This research uncovers the multifaceted dimensions of how Pakistani banks responded to the pandemic, focusing on measures related to operational continuity, staff well-being, customer engagement, and compliance with government guidelines. Our findings reveal the comprehensive strategies and actions adopted by Pakistani banks to mitigate the impact of COVID-19. These measures include the rapid implementation of remote working arrangements, enhanced digital services, rigorous sanitization protocols, and financial relief initiatives for customers facing economic hardships. The study concludes by discussing the implications of the COVID-19 experience for the future of Pakistani banking, emphasizing the importance of continued investment in digital infrastructure, risk management, and flexibility to navigate uncertain times. The insights generated from this qualitative research are expected to inform policymakers, banking professionals, and researchers, facilitating a more resilient and adaptive banking industry in Pakistan and beyond.

When and how big data analytics and work practices impact on financial performance: an intellectual capital perspective from banking industry

PurposeThis study aims to determine the role of intellectual capital (IC) on financial performance (FP), the mediating effect of high-performance work practices (HPWPs) and the moderating role of big data analytics on the banking sector operating in Pakistan.Design/methodology/approachThis study collected quantitative and cross-sectional data using structured questionnaire forms distributed to selected targeted respondents using a convenient sampling technique. The 518 useable questionnaires were analysed using the SmartPLS software through a structural equation modelling technique to test the proposed research hypotheses.FindingsThe study results revealed that IC has shown an impact on FP. The role of HPWP significantly mediates between IC and FP, while the moderating role of big data analytics remains insignificant.Practical implicationsThis study highlights IC's role in enhancing FP in the Pakistani banking sector. It will bring a higher quality IC in the banking sector, and they will be better positioned to serve the community. Policymakers need to invest in IC and HPWP and utilise BDA, which will boost FP and uplift the quality of the banking sector.Originality/valueThis study extends the concept of IC and adds the theoretical role of HPWPs and big data analytics in the literature on IC, along with the contextual application. The study also develops a unique role of the integrated IC model theory with a relationship to the banking sector of Pakistan.

Comparison of the Turkey and Pakistan Bankıng Sector during the Covıd 19 Pandemic Process and Analysis of the Relationship wıth the Internal Factors Determined Regardıng Financial Vulnerabilities

The banking sector, the importance of which cannot be denied in the development of national economies, may be subject to many internal or macroeconomic factors that can cause vulnerability. On December 1, 2019, the adverse effects of the covid 19 pandemic, which started in Wuhan, China and spread all over the world in a brief period, revitalized the importance of the financial fragility problem in the Turkish banking sector as well as in the banking sectors of other countries around the world. This study it is aimed to analyze the relationship levels of the endogenous factors associated with financial vulnerability in the Turkish-Pakistani banking sector with the data for the period of 2016-2020 based on two countries. For this purpose, the micro variables of 24 deposit banks operating in the Turkish banking sector and 23 deposit banks operating in the Pakistani banking sector were determined as return on assets, interest margin, return on equity, liquidity, and financial leverage. Financial vulnerability is defined as the capital adequacy ratio and correlation and regression analyses were conducted to identify the relationship with micro variables. In the literature review, it has been observed that studies and research have been undertaken on financial vulnerability and stability in the Turkish banking sector and in different countries. However, these studies are mainly regional assessments rather than comparisons between two different countriesın this context, the evaluation of the vulnerability of the banking sectors of the two countries in the covid 19 process indicates that this study is distinct from the others. In addition, this comparison of the financial vulnerability levels of banks in the event of a possible crisis in the banking sector of the two countries is intended to assist similar academic studies and to enrich and diversify the literature.

Determinants of Credit Risk and Operational Risk in Banking Sector Evidence from Pakistani Banking Sector

Risk management is what kind of strategies should be adopted to reduce all kinds of risk. Risk the difference between the actual return and the expected return. And credit risks the potential that borrower will fail to meet the obligation. The banking industry of Pakistan is faced with several challenges among them are determinants of credit risk and operational risk. Determinants of credit risk are defined as the factors that may affect the credit risk and determinants of operational risk are defined as the factors that affect the operation of business. Many banks in Pakistan have created credit risk management departments that are responsible for managing the credit risk associated with banking operation. The objective of this study is to evaluate the determinants of credit risk in Pakistani banking sector. The collected data consists of secondary data. Financial data was collected from three banks of Pakistan listed at Karachi stock exchange (KSE) over the period of 17 years from 2000 to 2016. Panel Regression Model was applied to find the cause and effect relationship for the under-consideration issue. The result has shown that credit risk and operational risk have a significant and positive relationship with NPLs, Gearing Ratio, and Operating Efficiency. And Credit Risk and operational risk have positive but insignificant relationship with Liquid Assets (LA). The recommendation of this study is if we pursue proper bank regulations, then the regulation should be backed up by sound credit analysis, and provision for suitable situation of credit loans.

Assessing intellectual capital performance of banks during COVID-19: Evidence from China and Pakistan

<abstract> <p>Using quarterly data from 2019Q1 to 2020Q3, this study aims to examine the impact of COVID-19 on intellectual capital (IC) performance of banks operating in China and Pakistan. Based on the data of 34 Chinese and 41 Pakistani banks, this study applies the fixed effect method to examine this relationship, and the value added intellectual coefficient (VAIC) model is used to measure IC performance. The study shows a negative but insignificant influence of COVID-19 on IC performance of the banking sector in both countries. Likewise, the findings exhibit that IC components show resilience against COVID-19 and are slightly influenced by this crisis. The results are also consistent in robustness check. The cross-country comparison suggests that the performance of IC components in the Pakistani banking sector is higher compared to China. This is the first study that examines the impact of COVID-19 on IC performance of banks, and it might provide insights regarding the influence of crises such as COVID-19 on IC performance of banks in emerging economies.</p> </abstract>

Basel accord capital regulations and financial risk management: Empirical evidence from Pakistan’s financial institutions

The Pakistani banking sector has shown tremendous growth in the last two decades and witnessed strategic reforms including the implementation of Basel regulations. The objective of this study is to investigate the effect of Basel capital regulations on the various proxies of the financial performance of the Pakistani commercial banks. This study uses three different proxies to assess the effectiveness of the Basel capital regulations on the financial performance of Pakistani commercial banks from 2006 to 2018 and quantifies the effect of different Basel accords on the banking sector of Pakistan using the dynamic panel data estimation technique. In addition, the effect of the Global Financial Crisis (2008) on the financial performance of Pakistani banks has also been evaluated. The results indicate that Basel II and Basel III capital regulations have affected the banks’ profitability differently. Capital regulations of Basel II have increased the performance while capital requirements of Basel III have not affected the financial performance of Pakistani banks, pointing towards the ineffectiveness of Basel III capital regulations. Besides, there has been no change observed in the financial performance of Pakistani banks during the Global Financial Crisis (2008). Overall, the results of the Generalized Method of Moments (GMM) technique show that Basel capital regulations enhance the financial performance of the Pakistani banking sector.

Role of Green Finance in Attaining Corporate CSR Goals

To achieve sustainable development goals, economies are increasingly adopting a green financing strategy. Socioeconomic and environmental initiatives are required for the long-term growth of the firm. CSR developed as a strategy to foster social harmony via the sustained prosperity of corporations. However, in order for organizations to remain consistent with their CSR and sustainability objectives, enormous resources are required. This study explores how green finance contributes to accomplishing, succeeding at, and strengthening CSR in the banking sector. Primary information was gathered from 320 workers in the Pakistani banking sector in order to establish the relationship between the variables used in this study. Green financing and its environmental, economic, and social considerations contribute to the improvement of CSR's numerous aspects, as shown by survey data. The results demonstrated a positive relationship between green finance dimensions and CSR goals. Based on these findings, the researcher concludes the hat financial services industry should put more resources into cultivating CSR behaviours.

PSYCHOLOGICAL WELL-BEING AND ITS ASSOCIATED FACTORS IN BANKING EMPLOYEES OF PAKISTAN: A SYSTEMATIC REVIEW

ABSTRACT
 
 Purpose: The present paper reviews the existing literature in the field of psychological well-being (PWB) while presenting a comprehendible vision of existing dynamics and exploring the diversity of the notion. This systematic literature review reflects on a number of accessible research papers from ten years (i.e., 2012 to 2021) contributing to the factors associated to psychological well-being in organizational setup of Pakistani banking sector employees.

Impact of Green Intellectual Capital on Sustainable Green Banking: Moderating Role of Competitive Pressure

Purpose: Adoption of an environmentalist perspective in banking operational base through social, economic, and environmentally sustainable activities becomes debatable for firm performance. The study aims to examine the impact of green intellectual capital on sustainable green banking and the moderating role of competitive pressure between them.
 Design/Methodology/Approach: The study surveyed by using self-administrative questionnaires from the bank employees of Rawalpindi and Islamabad. The data was collected from a sample size of 351 by using a random sampling technique. The measures of Green Intellectual Capital (GIC) are encompassed three elements as Green human capital (GHC), Green Structural Capital (GSC), and Green Relational Capital (GRC) comprising 18 items (Yusof, Omar, Zaman, & Samad, 2019) and moderator competitive pressure comprising of 7 items was adopted (Sophonthummapharn, 2009).
 Findings: The result of the study shows that green intellectual capital positively contributes toward achieving sustainable green banking. Competitive pressure moderates the said relationship in the context of the Pakistani banking sector. The finding of the study implies that banks in Pakistan implement green activities because of the competitive force of the external environment and achieve both sustainability in terms of environmental protection and less amount of carbon print. Therefore, banks have more focus on the use of green intellectual capital containing green human capital, green structural capital, and green relational capital than the banks achieve sustainable green banking.
 Implications/Originality/Value: The study provides a practical implementation for banks to move towards sustainable green banking.

The Implementation of Customer Relationship Management System and Innovative HR Practices in Pakistani Banking Sector

The growing competition in financial markets worldwide is indicator for the need of Customer Relationship Management (CRM) systems in baking sector to gain and sustain the competitive advantages. The basic aim of the research is to investigate and highlight the success factors and status of the CRM implementation in Pakistani Banking Sector. Data obtained from three larger banks (UBL, HBL and MCB) and four other banks in South Punjab, Pakistan. Questionnaire was used to collect data from 100 bank employees. The responses were collected on five-point Likert scale. The SPSS software was used to analyse the data. Hypotheses were tested using multi regression analysis. Regression analyses performed to check the cause-and-effect relationship between dependent variable (Implementation of CRM) and independent variables (top management support, customer attitude and Innovative HR Practices). Some of limitations in this study were due to shortage of time and finances. Researchers also suggested some directions for future studies.

Lecture, Faculty of Humanities and Social Sciences, GIFT University, Gujranwala

The aim of the current study is to inspect the intervention of customer satisfaction in the association between service quality and corporate image to customer loyalty in the Pakistan banking sector. The population of this research is banking customers and a sample size of 210 respondents. This study uses the SPSS, Correlation, ANOVA and regression analysis techniques along with AMOS methods. The results of the study show that service quality and corporate image of the banks are not associated with customer loyalty, but this association is possible due to customer loyalty. This study shows that banks must focus on customer satisfaction to engage customer loyalty. CL is only achieved through customer satisfaction. The Pakistani banking sector, therefore, improves customer satisfaction, so the association between service quality, corporate image and customer loyalty must be enhanced.

Credit risk management resource efficiency in the implementation on Basel Accord: a study of Pakistani banking sector

This research endeavours to examine credit risk management (CRM) capabilities for Basel accord implementation in Pakistani banks. The results obtained depict that the banks in Pakistan do not have adequate human resource capabilities for CRM that is affecting their risk performance and Basel accord implementation. This research introduces a new measure of credit risk measurement, which is credit risk weighted assets to credit risk employees ratio. This ratio has been used for measuring capabilities of banks for implementation of Basel Accord. Keeping in view the results it is suggested that further work is required by the banks and the regulators to improve the availability and training of human resources for CRM and ultimately to reap the benefits of Basel Accord implementation.

Credit risk management resource efficiency in the implementation on Basel Accord: a study of Pakistani banking sector

Credit risk management resource efficiency in the implementation on Basel Accord: a study of Pakistani banking sector