Priya Saha

This study examines the impact of sustainable finance factors on bank performance in Bangladesh. It utilizes annual data from 24 listed commercial banks in Bangladesh from 2016 to 2022. It focuses on three sustainable finance factors: green finance, corporate social responsibility (CSR), and digitalization. These factors ensure sustainable finance practices by prioritizing eco-friendly investments, responsible business operations, operational efficiency, and reduced resource consumption rather than focusing solely on short-term profit maximization. Return on assets (ROA) and return on equity (ROE) are used to measure the performance of commercial banks. This study incorporates default rate and bank size as control variables to consider inherent risk and operational scale, resulting in a more precise evaluation of the impact of digitization, CSR, and green financing on bank performance. Traditional and dynamic panel regression models, including feasible generalized least squares (FGLS) and random effects models, are applied to ensure robust findings. The findings indicate that green finance exhibits an insignificant impact on bank performance. However, corporate social responsibility (CSR) demonstrates a statistically significant positive effect on ROE through positive marketing, enhancing reputation, and building shareholder loyalty towards banks. Conversely, digitalization shows a statistically significant negative effect on performance, implying that initial implementation costs and challenges may outweigh the benefits. In addition, control variables, including default rate and bank size, exhibit a statistically significant negative relationship with performance measures. This suggests that higher default rates indicate increased credit risk and financial losses, while larger bank sizes may lead to inefficiencies due to agency costs and organizational complexities.

Type of the article: Research Article

Abstract
This study examines the influence of socio-economic factors on life insurance demand in Bangladesh using annual data from 18 life insurance companies between 2014 and 2023. Life insurance demand is assessed using life insurance penetration and life insurance density; GDP per capita, inflation, healthcare spending to GDP, and education spending to GDP serve as proxies for socio-economic variables. This study employs a dynamic Panel-Corrected Standard Errors (PCSE) method to handle cross-sectional dependence in panel data. Stepwise regression is further applied as a robustness check. The findings exhibit that GDP per capita has a statistically significant negative impact on insurance density (β = –0.0003, P < 0.001) and insurance penetration (β = –0.000002, P < 0.001). This suggests that income growth does not facilitate increased insurance adoption. In contrast, inflation has a significant positive influence on both insurance density (β = 0.0310, P < 0.001) and insurance penetration (β = 0.0001, P < 0.001), emphasizing the influence of inflationary pressure on life insurance demand. Similarly, healthcare expenditure exhibits a significant positive effect on life insurance demand, influencing both insurance density (β = 2.0560, P < 0.01) and insurance penetration (β = 0.0024, P < 0.05), possibly due to rising healthcare costs prompting individuals to seek financial security. However, education spending does not show a statistically significant effect on life insurance demand. The results indicate that demand for life insurance in Bangladesh is influenced more by financial insecurity than by income increases, emphasizing the impact of inflation and healthcare expenses on insurance adoption.

Type of the article: Research Article

Abstract
This study, grounded in agency theory, stewardship theory, and resource dependency theory, examines the influence of corporate governance on firm value within the banking sector of Bangladesh. This research analyzes annual panel data from 22 commercial banks spanning the period from 2014 to 2023, investigating the impact of governance structures, specifically board composition, ownership structure, and audit committee characteristics, on firm value using Tobin’s Q, market capitalization, and the market-to-book value of equity measures. The Feasible Generalized Least Squares (FGLS) method is utilized for dynamic panel data estimation to address cross-sectional dependence, heteroscedasticity, and autocorrelation, with robustness evaluated via the Panel-Corrected Standard Errors (PCSE) approach. Overall findings reveal that increased managerial ownership, gender-diverse boards, and an independent audit committee director correlate positively with firm value. Specifically, institutional ownership exhibits a positive correlation with Tobin’s Q and the market-to-book value of equity, whereas foreign ownership and larger boards positively affect Tobin’s Q and market capitalization. In contrast, board size adversely impacts the market-to-book value of equity, while frequent board meetings correlate with a diminished Tobin’s Q. The audit committee size and meeting frequency have no statistically significant effect. These findings provide significant insights for regulators and policymakers, highlighting the necessity of inclusive governance, strategic ownership alignment, and independent oversight in enhancing the value of banks in emerging economies, such as Bangladesh.

Acknowledgment
Shaikh Masrick Hasan gratefully acknowledges the research grant provided by Jagannath University, Bangladesh, in the financial year 2024–2025, which made this study possible.