The Influence of Top Management Team (TMT) Characteristics Toward Indonesian Banks Financial Performance During The Digital Era (2014-2018)

Mojambo, Gabriel A.M. and Tulung, Joy Elly and Saerang, Regina Trivena (2020): The Influence of Top Management Team (TMT) Characteristics Toward Indonesian Banks Financial Performance During The Digital Era (2014-2018). Published in: JMBI UNSRAT , Vol. 7, No. 1 (January 2020): pp. 1-25.

Abstract

Despite of the abundant opportunities in Indonesian bank industry, digital era began to challenge banks to fully embrace the use of technology (information) with the objective of prolong competitive advantage. An organization becomes a reflection of its top managers. In facing such challenges, Top Management Team (TMT) members initiative to overcome the current status quo, will be reflected to the company under their management. For this reason, an effective TMT structure is a mandatory during the digital era to digitalize banking firms. This research investigates the relationship between top management team characteristics and Indonesian banks financial performance during the digital era. For top management team characteristics, this research includes functional background, gender diversity, average age, level of education, IT Expertise, and experience in years. While to measure the performance of Indonesian banks financial performance the paper includes return on asset (ROA), capital adequacy ratio (CAR), and non-performing loan (NPL). The results show that gender diversity have positive significant influences on NPL, average age have positive significant influences on ROA, CAR, NPL, and IT expertise have positive significant influences on CAR.

• Item Type: MPRA Paper
• Language: English
• Keywords: Bank, Top Management Team, Financial Performance
• Subjects: G - Financial Economics > G2 - Financial Institutions and Services; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages; G - Financial Economics > G3 - Corporate Finance and Governance

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