The Impact of Managerial Ability on the Market Value of Banks:(An applied Study of Banks Listed on the Damascus Securities Exchange)
Keywords:
Managerial Ability, bank value, Resource-Based Theory.Abstract
This study aims to examine managerial ability and its effect on the value of banks listed on the Damascus Securities Exchange. Using secondary data from published annual reports, the study covered 11 conventional banks, after excluding Islamic banks, during 2015–2024, with 110 observations.
Bank value was measured by Tobin’s Q, while managerial ability was measured in two stages. First, DEA was used to estimate bank efficiency. Second, a regression model was applied to separate bank-specific characteristics from overall efficiency, with the residuals representing managerial ability. The measure follows Demerjian et al. (2012), as adapted by García-Meca and García (2018) for banks. Data were analyzed using EViews.
The study used Panel Data and Panel GMM to account for the dynamic nature of the data. The results show a positive and statistically significant effect of managerial ability on banks’ market value, while bank size and leverage had no significant effect.
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