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Article

Mehree Iqbal, Nabila Nisha and Mamunur Rashid

The purpose of this paper is to argue that “being Islamic” is already embedded in the decision frame of the Muslim consumers when choosing their Islamic banks, and hence…

Abstract

Purpose

The purpose of this paper is to argue that “being Islamic” is already embedded in the decision frame of the Muslim consumers when choosing their Islamic banks, and hence, the bank selection criteria of these Muslim consumers will be dominated by non-faith-based factors.

Design/methodology/approach

This study took the context of retail consumers of Islamic banks of Bangladesh—the fourth largest Muslim populated country in the world, having great potential of developing an Islamic ecosystem. The study employed survey method using structured questionnaire on 311 respondents from 35 branches of six Islamic banks in Dhaka—the capital city of Bangladesh. Exploratory factor analysis, followed by multivariate regression analysis, was conducted to identify the determinants of satisfaction among Muslim retail bank customers.

Findings

The study forwards three important findings. First, faith-based bank selection criterion (i.e. Islam) is not a stand-alone factor anymore; rather, the items of this factor are embedded into other non-faith-based factors. Second, among the non-faith-based factors, commitment of the bank, competence and compassion of the bank employees have topped the list of bank selection criteria. Third, competence, commitment and corporate image of the bank had relatively more influence on satisfaction when compared to compassion and convenience.

Practical implications

Since Shari’ah compliance is already embedded in Islamic banking system, Islamic bankers should now focus on strategic targeting of their customers based on non-faith-based operational determinants.

Originality/value

This study presents that non-faith-based selection criteria are more influential in Islamic bank selection decision.

Details

International Journal of Bank Marketing, vol. 36 no. 5
Type: Research Article
ISSN: 0265-2323

Keywords

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Abstract

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 11 no. 2
Type: Research Article
ISSN: 1753-8394

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Article

Md Mamunur Rashid

The purpose of this study is to examine the mediating role of corporate board characteristics in the relationship between ownership structure and firm performance in the…

Abstract

Purpose

The purpose of this study is to examine the mediating role of corporate board characteristics in the relationship between ownership structure and firm performance in the listed public limited companies of Bangladesh.

Design/methodology/approach

The study analyzed 527 annual reports of listed companies in Bangladesh for the years 2015-2017. The direct and indirect effect of ownership structure on firm performance was examined using AMOS 23. Baron and Kenny’s (1986) four steps procedure was used to establish the mediating role of board characteristics.

Findings

The results demonstrated that foreign ownership and director ownership have significant positive influence on both accounting and market based firm’s performance, while institutional ownership exhibits positive influence only on accounting-based performance (return on assets). With respect to mediating effect, the results show that board size and board independence partially mediate the relationship between ownership structure and firm performance.

Research limitations/implications

The major limitation of the study is that it focuses only on three years data in examining the hypothesized relationship among the variables.

Practical implications

Investors, regulators and managers can get evocative insights, particularly who seek to improve their company’s performance in the capital market through restructuring their ownership structure and board composition.

Originality/value

The study focuses on both direct and indirect effect of ownership structure on firm performance in the context of an emerging and developing economy. In examining the indirect effect, the study uses board size and board independence as the mediating variables.

Details

Corporate Governance: The International Journal of Business in Society, vol. 20 no. 4
Type: Research Article
ISSN: 1472-0701

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Article

Md Mamunur Rashid

The purpose of this study is to examine the effect of board characteristics on foreign equity ownership (FEO) in the listed public limited companies of Bangladesh.

Abstract

Purpose

The purpose of this study is to examine the effect of board characteristics on foreign equity ownership (FEO) in the listed public limited companies of Bangladesh.

Design/methodology/approach

The study collected data from 418 annual reports of listed companies of Bangladesh for the years 2015, 2016 and 2017 to examine the effect of board characteristics on FEO. Ordinary Least Squares (OLS) and Two-Stage Least Squares (2SLS) regression methods are used to test the hypotheses of the study.

Findings

The results show that board size has significant negative influence on FEO. Other board characteristics variables such as board independence and female directorship appear to have an insignificant influence on FEO. However, several firm characteristics variables such as return on assets, market-to-book ratio, firm size and firm age have a significant positive relationship with FEO. While presenting the regression results separately for manufacturing and non-manufacturing firms, the findings reveal a number of differences in the results between the two sectors.

Research limitations/implications

The major limitation of the study is that it concentrates only on three years annual report data in analyzing the hypothesized relationships.

Practical implications

Policy makers, regulators and top management can get meaningful insights with respect to optimal board structure and firm characteristics to attract foreign investors as the results revealed significant effects of several board and firm characteristics variables on FEO.

Originality/value

The present study includes the presence of female directors on the board to represent board characteristics. No other study has examined the relationship between FEO and female directors.

Details

Journal of Accounting in Emerging Economies, vol. 10 no. 4
Type: Research Article
ISSN: 2042-1168

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Article

Selma Izadi, Mamunur Rashid and Parviz Izadi

Extending on the resource-seeking foreign direct investment (FDI) hypothesis, this paper aims to uncover the potential relationship between financial and non-financial…

Abstract

Purpose

Extending on the resource-seeking foreign direct investment (FDI) hypothesis, this paper aims to uncover the potential relationship between financial and non-financial channels and inward FDI before and after the global financial crisis.

Design/methodology/approach

The sample includes 561 year-country observations on 33 developed and developing countries during 2001 and 2017. This study investigates several determinants such as inflation, gross domestic product growth, exchange rate, trade openness, financial openness, Sharpe ratio and country market capitalization, using ordinary least squares, fixed effects and system generalized method of moments.

Findings

The results indicate a negative relationship between inflation and financial openness with FDI inflow while market capitalization and exchange rate were positively connected to FDI inflow. All three financial channels of FDI inflow: financial market size, financial openness and Sharpe ratio significantly influenced FDI inflow. Moreover, inflation, financial openness and Sharpe ratio imply a meaningful impact on the FDI inflow of developed and developing countries, with a relatively stronger influence during the post-crisis periods. Asymmetric impact tests also revealed similar results.

Research limitations/implications

These findings offer an impression that financial market development channels may significantly boost FDIs in developing and, as well as developed countries. With special reference to the developing countries, a disciplined financial market and financial openness may help attract more FDIs.

Originality/value

Impact of the financial crisis on FDI inflows while observing the impact of the financing channels in developing and developed countries is rare in the academic domain. This study forwards that a structured and open financial market may help in recovering from the financial crisis.

Details

Journal of Financial Economic Policy, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1757-6385

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Article

Mamunur Rashid, Xuan Hui Looi and Shao Jye Wong

Competitiveness is vital to attracting FDI into a country, which has led us to investigate the determinants of FDI in the top 15 most competitive countries in the Asia…

Abstract

Purpose

Competitiveness is vital to attracting FDI into a country, which has led us to investigate the determinants of FDI in the top 15 most competitive countries in the Asia Pacific region.

Design/methodology/approach

We have analysed political stability alongside other commonly studied determinants of FDI. We have employed a panel data fixed-effect model on a 14-year sample data (2000-2013) involving the top 15 most competitive Asia Pacific countries. The Global Competitiveness Index was taken as the yardstick to identify these countries. We have used fixed effect, GMM-system, and Panel ARDL tests for robust results.

Findings

The GDP, trade openness and political stability positively influenced FDI inflows while inflation rate negatively impacted FDI inflows in the selected countries. Political stability was the most influential variable in the presence of other indicators. GDP, openness, and political stability exhibit significant long-run relationship with FDI inflows.

Research limitations/implications

To increase FDI flows, regulators should focus on building the image of the country, and possibly the region, by ensuring stable economic and political environment, maintaining macroeconomic stability through bi- and multi-lateral arrangements with neighbouring countries.

Originality/value

Regional relationships with neighbouring countries can be considered as the building blocks for attracting FDIs. These relationships can be strengthened based on liberal trade policies, openness in capital control, and cooperation in terms of political actions. One such recent issue in regional political cooperation include actions to reduce terrorism and corruption that help boost the confidence of the investors.

Details

Journal of Financial Economic Policy, vol. 9 no. 02
Type: Research Article
ISSN: 1757-6385

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Article

Md. Mamunur Rashid

The purpose of this study is to examine the effect of financial reporting quality (FRQ) on share price movement (SPM) of listed companies in an emerging and developing…

Abstract

Purpose

The purpose of this study is to examine the effect of financial reporting quality (FRQ) on share price movement (SPM) of listed companies in an emerging and developing economy – Bangladesh.

Design/methodology/approach

The study analyzed 296 annual reports for the year 2015 and 2016 in examining the effect of FRQ on SPM. Ordinary least squares (OLS) regression model is used to examine the hypothesized relationship among the variables. A modified version of Lang et al. (2003) has been adopted in measuring the SPM. FRQ is measured using the qualitative characteristics approach as defined by the International Financial Reporting Standard Framework and used by Beest et al. (2009) and Braam and Beest (2013).

Findings

The study finds a positive association (though not significant statistically) between the FRQ and SPM in the country’s leading stock exchange (Dhaka stock exchange). Furthermore, the effect of enhancing quality on SPM is found to be stronger as compared to fundamental quality. Majority of the FRQ constructs demonstrate an improvement in the quality score in the year 2016 as compared to 2015 except for relevance.

Research limitations/implications

The key limitation of the study is that it focuses only on two years (2015 and 2016) annual reports data in measuring FRQ and its effect on SPM.

Originality/value

The study uses qualitative characteristics approach in measuring the FRQ and to examine its effect on SPM using the context of an emerging and developing economy – the case of Bangladesh.

Details

Journal of Financial Reporting and Accounting, vol. 18 no. 3
Type: Research Article
ISSN: 1985-2517

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Article

Md Mamunur Rashid

The purpose of this study is to examine the effect of the presence of professional accountants in the top management team (TMT) on financial reporting quality (FRQ) in…

Abstract

Purpose

The purpose of this study is to examine the effect of the presence of professional accountants in the top management team (TMT) on financial reporting quality (FRQ) in public limited companies using the context of Bangladesh, which is an emerging economy.

Design/methodology/approach

This study adopts a modified version of Beest et al.’s (2009) FRQ index to measure the quality of information published in 351 annual reports of listed companies in Bangladesh. It also uses a qualitative characteristics approach to measure the quality of financial reporting, as defined by the International Financial Reporting Standards framework 2018, as opposed to an accrual or value relevance approach that solely depends on the information disclosed in the financial statements.

Findings

This study finds that the presence of professional accountants in the TMT is positively and significantly associated with FRQ. The findings also show that the sample companies disclosed better quality information in the enhancing qualitative characteristics category, as compared to the fundamental qualitative characteristics category.

Originality/value

This study uses the context of Bangladesh to explore a new type of relationship between the presence of professional accountants in the TMT and FRQ.

Details

Journal of Accounting & Organizational Change, vol. 16 no. 2
Type: Research Article
ISSN: 1832-5912

Keywords

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Article

Md. Mizanur Rahman, Mohammad Ashraful Ferdous Chowdhury, Md. Mahmudul Haque and Mamunur Rashid

Owing to religious and economic preferences in Muslim-dominated countries, middle-income customers are at the heart of banks’ strategic targeting. This study aims to…

Abstract

Purpose

Owing to religious and economic preferences in Muslim-dominated countries, middle-income customers are at the heart of banks’ strategic targeting. This study aims to investigate selected middle-income Islamic bank customers from Sylhet, one of Bangladesh’s top religious and cultural cities, to examine their perceptions of the Islamic banking services.

Design/methodology/approach

This study forwards three determinants of overall satisfaction. These are perceived relative advantage (PRA), perceived risk management (PRM) and perceived customer engagement (PCE). The study has used structured questionnaire and collected complete data on 300 middle-income Islamic bank users. The data was analysed using exploratory factor analysis (EFA), confirmatory factor analysis (CFA) and structural equation modelling (SEM).

Findings

While all the three selection factors significantly influence overall satisfaction, PCE has greater positive impact on overall customer satisfaction, followed by PRA and PRM. “Convenient location”, “competitive charges” and “return on deposit despite low earnings” are the top three instruments measuring “PCE”. Religion did not qualify as a standalone selection factor. The results are robust across tests conducted by using EFA, CFA and SEM.

Practical implications

Gross purchasing power of middle-income class in Bangladesh grew from 7% to over 30% during the past decade, and the purchasing power of this class stood at US$100bn. Having a greater portion of this population as Muslims, banks can design products and marketing campaigns by using the three selection criteria that offer a combination of faith and non-faith-based variables.

Originality/value

Similar studies on the middle-income customer group have been rare, especially from the Islamic banking perspective. These findings offer a concise list of three factors for the bank managers to build their strategies. With respect to the Vision 2021, these findings carry greater socio-economic significance given the transition of Bangladesh to a middle-income country.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 14 no. 2
Type: Research Article
ISSN: 1753-8394

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Article

Cheedradevi Narayanasamy, Mamunur Rashid and Izani Ibrahim

The purpose of this paper is to bridge the gap between the theory underlying divergence of opinion (DOP) and a cognitive concept termed as attention by specifically…

Abstract

Purpose

The purpose of this paper is to bridge the gap between the theory underlying divergence of opinion (DOP) and a cognitive concept termed as attention by specifically focussing on the volume and price behaviour in initial public offering (IPO) settings.

Design/methodology/approach

Employing the hierarchical regression for a sample of 282 Malaysian fixed price IPOs issued from 2004 to 2014, this research investigated the effect of investors’ attention on other information that complements the information revealed by initial return on DOP. Measure of market adjusted turnover (AbTO) from non-IPO setting was used to capture the DOP in the after-market, while investors’ attention was on a dichotomise scale variable which was captured by the increase/decrease of the Google search index (GOGC2) on the month of listing compared to a month prior to listing.

Findings

The findings indicate that attention moderates the relationship between initial return (also surrogates underpriced IPOs) and DOP. The findings suggest that disagreement to initial returns is reduced, while liquidity in the after-market is promoted, when investors pay more attention to other information that complements price change. The findings also indicate that behavioural tendency is less when individual participation is weak.

Research limitations/implications

This paper highlights the importance of interaction effects in explaining the behavioural tendency in the after-market.

Practical implications

The weak individual investors’ participation and greater attention reduce the market inefficiency in Malaysia.

Originality/value

The finding is consistent with the view that the level of individual investors’ participation and information disclosure requirements has an implication on behavioural bias, which affects DOP in the after-market.

Details

Review of Behavioral Finance, vol. 10 no. 1
Type: Research Article
ISSN: 1940-5979

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