Firms in the financial sector have a legal responsibility towards their shareholders to maximize shareholder value, just like any other public listed firm. However, unlike non-financial firms, financial firms have the extra responsibilities of protecting their non-shareholder stakeholders, ensuring the stability of the financial system, and reducing systemic risk (Turlea et al., 2010). Prior studies emphasized that the agency problem is exacerbated in the financial sector due to the capital structure of firms in the sector, the complexity and opacity of the business, and the regulations governing the sector (de Haan & Vlahu, 2016). Financial firms engage in significant investment activities and the funds for these activities are sourced mainly from stakeholders, such as depositors, who bear a substantial part of the costs in case investments undertaken by the firm fail (de Haan & Vlahu, 2016). This encourages excessive risk-taking by shareholders who do not have a substantial stake in the firm (Laeven & Levine, 2009). In addition, the complexity of the operations of firms in the financial sector increases information asymmetry and coordination costs, thereby reducing the capacity of the stakeholders to monitor managers (de Haan and Vlahu, 2016, Fernndez Snchez et al., 2020)