Intellectual capital and financial stability of Islamic banks in OIC countries: the moderating role of corporate governance

Purpose The purpose of this research is to analyse the impact of intellectual capital (specifically human capital, structural capital and relational capital) on Islamic bank financial stability with a particular focus on the moderating role of corporate governance. Design/methodology/approach This research uses panel data of 126 Islamic banks from 26 countries from the Organization of Islamic Corporations (OIC) during the period 2010–2022, while hierarchical two-step system generalize method of moment estimation was used for estimation. Findings This study finds that investment in human and structural capital has a positive and significant role in attaining financial stability in Islamic banks of OIC countries. Besides, good corporate governance positively moderates the impact of intellectual capital on the financial stability of Islamic banks. Research limitations/implications The empirical outcome of this study will be beneficial for the regulator, policymakers and bankers to accelerate the intellectual capital resources and an effective governance structure to attain financial stability in Islamic banks. Originality/value This study enriches the understanding of intellectual capital, corporate governance and financial stability of Islamic banks in OIC countries.