Abstract: Purpose: This study aimed to examine the effectiveness of audit and risk committees on the financial performance of banks
listed on the Palestinian and Amman Bourses, by measuring the effectiveness of the audit and risk committees using proxies, which are
the size of the audit and risk committee, the experience and qualifications of the members of the audit and risk committees, the
independence of the members of the audit and risk committees, and the number of audit and risk committee meetings. As for financial
performance, it was measured by using the Return on Assets and the Earnings Per Share. Methodology: To achieve these objectives
the Descriptive -Analytical approach was used. A sample consisting of (21) banks distributed between the two bourses was used during
the period (2015-2022), Findings: The study determined that there is a positive and insignificant effect on the size of the audit
committee, the independence of the audit committee, audit committee meetings, and the independence of the risk committee. There is
a significant positive effect of the size of the risk committee, and an insignificant negative influence of both the experience and
qualifications of the members of the audit committee and risks on the performance. On the other hand, the study also found a positive,
insignificant impact of both the size of the audit committee and the meetings of the risk committee on performance. Also, there is a
negative, insignificant impact of both the independence of the risk and audit committee and the diversity of experiences of the members
of the audit and risk committee. Additionally, there is a significant negative effect of audit committee meetings, and a significant positive
effect of the size of the risk committee on Earnings Per Share. Recommendations: Based on the findings, this study recommends the
boards of directors pay attention to applying banking governance principles, making them a function of follow-up and oversight. They
should also consider the availability of financial and accounting expertise for members of permanent committees when forming these
committees, as it positively impacts their supervisory role. Central banks should also pay greater attention to activating the characteristics
of the audit committee and the risk committee to strengthen their supervisory role. Developing the skills and capabilities of those working
in risk management is essential to enhance good supervision and improve their knowledge of Basel regulatory principles, especially
focusing on operational risks after the issuance of Basel III. Ignoring operational risks can lead to financial crises, so it is crucial to
address them.
Keywords: Audit Committee, Risk Committee, Amman Stock Exchange, Palestine Bourse, Financial Performance