DOES BANKING MODEL MATTER FOR INTELLECTUAL CAPITAL EFFICIENCY? EVIDENCE FROM ISLAMIC AND CONVENTIONAL BANKS IN DUAL BANKING COUNTRIES
DOI:
https://doi.org/10.35631/AIJBES.829073Keywords:
Capital Employed Efficiency (CEE), Dual-Banking, Human Capital Efficiency (HCE), Intellectual Capital, Structural Capital Efficiency (SCE), VAICAbstract
As the global economy enters the Fourth Industrial Revolution (4IR), knowledge-based resources have supplanted physical capital as the primary drivers of value creation. This study investigates Intellectual Capital (IC) efficiency within the dual-banking systems of eight countries (Malaysia, Pakistan, Jordan, Bangladesh, Saudi Arabia, Bahrain, Qatar, and the UAE) through the dual lenses of Resource-Based View (RBV) and Institutional Theory. Data were retrieved from the Fitch Rating Pro database for the period 2014–2024. Utilizing the Value-Added Intellectual Coefficient (VAIC™) model, we calculate and compare Human Capital Efficiency (HCE), Structural Capital Efficiency (SCE), and Capital Employed Efficiency (CEE). Inferential statistical analysis, including Independent Samples t-tests, reveals that Islamic banks possess a significant comparative advantage in HCE, driven by specialized expertise in Shariah-compliant contracts. Conversely, conventional banks demonstrate superior SCE and CEE, benefiting from mature organizational infrastructures and broader capital deployment flexibility. These results provide empirical evidence that banking models fundamentally influence IC utilization. This study contributes to the literature by demonstrating how institutional frameworks shape intangible resource efficiency, offering critical policy implications for bank managers seeking to balance IC components for long-term sustainability in a knowledge-driven market.
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