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The purpose of this paper is to investigate the effect of revenue diversification, non-interest income and asset diversification on the performance and stability of the Gulf Cooperation Council (GCC) conventional and Islamic banking systems.

The authors implement a panel of 69 conventional and Islamic banks listed in six GCC markets over the period of 2003–2015, using the System Generalized Method of Moments methodology.

Non-interest income diversification has a negative impact on GCC banks’ performance, while asset-based diversification affects banks performance positively. However, Investors tend to penalize the value of the banks’ assets, which are highly diversified. Government intervention, lack of competition, legal protection and high control of Central banks on GCC banks’ have positive impact on performance. Contrary to the results on conventional banks, asset diversification adds value to Islamic banks. Overall, both banks’ revenue and non-interest diversification have negative impact on GCC banks’ stability, while asset diversification improves Islamic banks’ stability.

The analysis is limited to a sample of banks, which are listed in the GCC stock exchanges. The lack of data on private and foreign banks operating in the region made the analysis and, consequently, the results specific to shareholding companies. Also, the authors’ measures of bank stability might not be appropriate to use for Islamic banks, given their banking models implemented.

Research results provide important implications for regulators, bank managers and policy makers, as to the expected ways to support economic diversification through bank diversification strategies.

Unlike related studies, the authors’ sample of homogeneous banks has a market structure that is different from the samples in the literature covering either developed countries or heterogeneous samples from both developed and developing countries. Furthermore, using an efficient econometric methodology, the authors deal with two types of banks: conventional banks and Islamic banks. The research determines which type of bank is more able to benefit from different types of diversification. Unlike previous research, this research explores the sensitivity of the results both to the regulatory environment of the GCC market and to general market conditions.

The purpose of this paper is to examine the effect of ownership structure and board composition on bank performance as measured by Tobin's Q and market to book value in Gulf Co-Operation Council (GCC) countries.

A dataset of 58-listed banks of GCC countries for the period 2010 is used. The methodology is based on multivariate regression analysis.

The result shows that the extent of family ownership, foreign ownership and institutional ownership has a significant positive association with bank performance. However, government ownership does not have a significant impact on performance. Other governance variables such as CEO duality and board size appear to have an insignificant impact on performance.

Better corporate governance mechanisms are imperative for every company and should be encouraged for the interest of the investors and other stakeholders. The study implies that ownership by corporate governance is more effective for GCC countries. The study also suggests that unlike in western countries, corporate boards may not be an effective corporate governance mechanism in GCC countries.

The paper extends the findings of the corporate governance and bank performance relationship in GCC countries that are neglected in the previous literature.