Abstract:

Purpose – the present paper is aimed at 1) assessing the intellectual capital and its components at the banks; 2) reviewing the opportunity of including the intellectual capital into the bank annual report;

Design/ methodology/ approach – in order to achieve results, the authors of the research have performed the qualitative analysis of: 1) scientific literature on intellectual capital and its inclusion into the bank annual reports; 2) the banks’ intellectual capital components, which are included into the annual reports on nonfinancial resources of such banks as Oesterich Nacional Bank (Austria), Development bank of Japan (Japan), Bankinter (Spain), Banco Bilbao Vizcaya Argentaria (Spain).

Findings – when performing the research, the authors came to the conclusion that during the last years banks have mostly focused on the social responsibility and environmental issues. While the assessment of intellectual capital, knowledge management and their detailed inclusion into the bank annual reports is still new and unprecedented practice, which can be proved by the information publically available on the banks’ web pages. However, there are also banks, which include intellectual capital into the annual reports, reflecting its many dimensions in detail and demonstrating capital management principles, which cannot be expressed in the words.

Research limitations/ implications – conducting the research, the authors have faced certain limitations, i.e. the banks’ annual reports and/or web pages either do not contain or do not provide public access to information on the intellectual capital and its management principles.

Originality/ value – the authors believe that the inclusion of the intellectual capital components into the annual reports is gaining more attention, assessing the bank stability not only from the point of view of its shareholders, but of its clients as well. 

In order to completely assess the connection between the banks financial indicators and necessity to include intellectual capital, which cannot be expressed in words, into the annual reports, the authors believe that additional investigations are required.