Conceptual framework of bank's financial stability, governance mechanisms, regulation and risk management in the Kingdom of Saudi Arabia

Abstract

Risk-taking is part and parcel of several organizations. In practical sense, risk management assisted the organization in meeting their underline objectives in spite of associated risks. To achieve this, financial institutions employs risk policies as well as frameworks that is suitable for their business operations. This study presents financial performance enhancement model for banking industry in the Kingdom of Saudi Arabia. This study aim to review impact of regulation on risk management and explore effectiveness of the role of board directors between capital adequacy and risk management. This study evaluates board director’s effectiveness based on five characteristics; size, independence, meeting, age diversity, and board committee.