Authors: Rashedul Hasan; Mohammad Dulal Miah
Addresses: Department of Accounting and Finance, Faculty of Business, Nilai University, No 1, Persiaran Universiti, Putra Nilai, 71800 Nilai, Negeri Sembilan, Malaysia ' Department of Economics and Finance, University of Nizwa, Nizwa, P.O. Box 33, PC 616, Oman
Abstract: The paper aims at investigating the effect of intellectual capital (IC) on the performance of financial institutions in Bangladesh. Quantitative data are collected from 49 financial institutions listed in the Dhaka Stock Exchange (DSE) for the year ending 2012 and 2013. IC is measured using Value Added Intellectual Coefficient (VAIC) developed by Pulic (1998). The impact of both the current and past years' VAIC on firm performance is measured, along with the effects of its three components - human capital efficiency (HCE), capital employed efficiency (CEE), and structural capital efficiency (SCE). The stepwise regression results indicate a positive and significant relationship between current year VAIC and two measures of firm performance (ROA, ROE) while past years' VAIC is found insignificant for all three measures of firm performance. HCE for the current year is found to be the most significant contributor toward firm performance among all the three components of VAIC, having a substantial positive relationship with all three measures of firm performance. SCE of the current year significantly affects ROA and ROE whereas CEE is found to be significant only for ROA. While measuring past years' effect on performance, only HCE has been found to have a negative influence on current year's revenue growth (RG).
Keywords: intellectual capital; firm performance; financial institutions; Bangladesh.
International Journal of Accounting and Finance, 2018 Vol.8 No.2, pp.133 - 150
Accepted: 08 Dec 2017
Published online: 05 Jul 2018 *