Overview

The national banking industry has posted continuous growth over the past few years, as indicated by an increase in total assets, sufficient capital adequacy and strong liquidity, as well as a dynamic and growing digital ecosystem. However, this rapid growth has resulted in a number of consequences, specifically relating to the emergence of new types of risks.^[1]

Given the strategic role that banks play in advancing the national economy, it is imperative to address important aspects of banking operations, particularly the strengthening of the country’s overall banking infrastructure through the application of bank governance.^[2] An effective bank governance regime will hopefully result in favourable bank performance, enabling banks to efficiently achieve their objectives while simultaneously mitigating any potential risks. Conversely, experience has shown that the application of inadequate governance may result in business competition failure, which may ultimately lead to a massive and widespread systemic crisis.^[3]