Ranking of Public and Domestic Private Sector Commercial Banks in Pakistan on the Basis of the Intellectual Capital Performance

Abstract

In a knowledge-based economy, intellectual capital is a main source for organizations to gain competitive advantage. This study is a preliminary study that focuses on banking sector to examine the intellectual capital performance through using VAIC and intellectual capital efficiency (ICE) method. The principal aim of this study is to rank Pakistani public and private banks based on intellectual capital performance. Value Added Intellectual Coefficient (VAIC) developed by Pulic (1998) was operationalized to achieve the desired aim. The available data was obtained from the annual reports of commercial banks during the period of 2005-2009. The results indicate that majority of the banks showed satisfactory intellectual performance. This study is based on limited scope. Therefore, it does not cover all banks in Pakistan. The findings of this study may be a good reference for future study and useful input for banking sector to strengthen their intellectual capital for optimum output.