Title: Do CEO characteristics influence Indian banks' performance and vice versa?

Authors: Rekha Handa; Priyanka Mahajan

Addresses: University Business School, Guru Nanak Dev University, Amritsar, India ' Lovely Professional University, Phagwara, Punjab, India

Abstract: The purpose of this study is to analyse the impact of chief executive officer (CEO) traits on bank performance. The analysis is based on second-hand data collected from 36 banks during a 15-year period, from 2005 to 2019. On the final sample, which consists of 540 observations, panel regressions model technique is run to examine the association between CEO (demographic and professional) traits on market valuation and financial performance of banks. The results, in particular, demonstrate that CEO-chairperson duality and the CEO's remuneration have a beneficial impact on bank performance. Moreover, the study discovers that CEO age has a negative relationship with Tobin's Q of the firm. CEO ownership and CEO tenure seem to be positively correlated with firm performance. It's interesting to note that a CEO or chairperson having regular attendance at board meeting enhanced firm performance measured by Tobin's Q whereas CEO turnover has shown negative relationship with ROA and ROE of firm. In light of the impending regulatory changes, this study offers insights to the lawmakers and regulators who are involved with selecting the CEOs of the banks.

Keywords: bank performance; public sector bank; private sector bank; CEO characteristics; CEO duality; CEO traits ; CEO tenure; Tobin's Q.

DOI: 10.1504/AAJFA.2025.147598

Afro-Asian Journal of Finance and Accounting, 2025 Vol.15 No.4, pp.491 - 529

Received: 17 Feb 2023
Accepted: 29 Dec 2023
Published online: 24 Jul 2025 *

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