Title: The impact of financial risk on economic value added: a comparative analysis of Islamic and commercial banks of Yemen

Authors: Mohammed H. Alsamhi; Fuad A. Al-Ofairi; Waleed M. Alahdal; Najib H.S. Farhan

Addresses: Faculty of Management Sciences, IBB University, Yemen ' Faculty of Management Sciences, IBB University, Yemen ' Faculty of Business, Economics and Social Development, Universiti Malaysia Terengganu, Kuala Nerus, Malaysia ' Faculty of Business Studies, Arab Open University, Kingdom of Saudi Arabia

Abstract: The present study attempts to analyse the impact of financial risk on the economic value added (EVA) of Yemeni Islamic and commercial banks. The study is based on time series data for the period from 2006 to 2014. Findings indicate that financial risk has a significant impact on the EVA of Yemeni Islamic banks. Further, liquidity risk (LQR) and exchange risk (EXR) have a positive and significant effect on EVA. Moreover, LQR and EXR have a significant impact on the EVA, while credit and capital risk have an insignificant impact on the EVA of the Yemeni commercial banks.

Keywords: financial risk; economic value added; EVA; Islamic banks; commercial banks; Yemen.

DOI: 10.1504/IJBEX.2023.128655

International Journal of Business Excellence, 2023 Vol.29 No.2, pp.266 - 287

Received: 26 May 2020
Accepted: 27 Jun 2020
Published online: 01 Feb 2023 *

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