scholarly journals Short-run Behavior of Defensive Assets in the Ethiopian Commercial Banking Sector

2019 ◽  
Vol 6 (2) ◽  
pp. 184
Author(s):  
Yitbarek Takele
Keyword(s):  
Banking Sector ◽  
Commercial Banking ◽  
Short Run

Dynamic Evaluation of Indian Commercial Banking Sector

2015 ◽  
pp. 600-615
Author(s):  
Nitish Datta
Keyword(s):  
Banking Sector ◽  
Learning By Doing ◽  
Commercial Banking ◽  
Dynamic Framework ◽  
Long Run ◽  
Short Run ◽  
Managerial Strategies ◽  
State Growth ◽  
Domestic Banks ◽  
Specific Growth Rates

The authors investigate the Indian commercial banking sector in the dynamic framework. Growth frontiers are derived with the help of Data Envelopment Analysis (DEA) to identify growth-efficient and growth-inefficient banks. The growth theories demand a steady-state growth path for each sector of the economy; on the other hand, the resource-based theory assumes firm-specific growth rates. The analysis shows dismal performance by domestic banks, both public sector and private; most of these domestic banks are growth-inefficient both in the short-run and in the long-run. The short-run as well as long-run findings strongly support the role of learning by doing as an engine to augment growth for all categories of banks. The analysis also exposes that the resource-based view of firm that generates rent generating competitive advantage ultimately drives both the managerial strategies and the performance of the Indian banking sector.

EMERGING TRENDS IN BANKING SECTOR - ITS CHALLENGES AND OPPORTUNITIES

2018 ◽  
Vol 6 (26) ◽  
Author(s):  
Karigoleshwar .
Keyword(s):  
Banking Sector ◽  
Banking Industry ◽  
Banking System ◽  
Major Change ◽  
Commercial Banking ◽  
Foreign Banks ◽  
Emerging Trends ◽  
Reserve Bank ◽  
Challenges And Opportunities ◽  
Multiple Regions

In financial sector the banking industry is the largest player, has also been undergoing a major change. Today the banking industry is stronger and capable of withstanding the pressures of competition. Today, we are having a fairly well developed banking system with different classes of banks – public sector banks, foreign banks, private sector banks – both old and new generation, regional rural banks and co-operative banks with the Reserve Bank of India as the fountain Head of the system. In the banking field, there has been an unprecedented growth and diversification of banking industry has been so stupendous that it has no parallel in the annals of banking anywhere in the world. The banking industry has experienced a series of significant transformations in the last few decades. Among the most important of them is the change in the type of organizations that dominate the landscape. Since the eighties, banks have increased the scope and scale of their activities and several banks have become very large institutions with a presence in multiple regions of the country.' The paper examines the new trends in commercial banking. The present era the cashless transactions, E-cheques, mobile wallets. The paper attempts to present the emerging trends and its challenges that recently emerged in the banking sector with special emphasis on digitization. It will be useful to the academicians, banking and insurance personnel, students and researchers. Common readers also know the latest innovations in banking sector

scholarly journals Determinants of Insurance Penetration in West African Countries: A Panel Auto Regressive Distributed Lag Approach

2021 ◽  
Vol 14 (8) ◽  
pp. 350
Author(s):  
Odunayo Olarewaju ◽  
Thabiso Msomi
Keyword(s):  
Banking Sector ◽  
West African ◽  
Education Sector ◽  
African Countries ◽  
Distributed Lag ◽  
Long Run ◽  
Short Run ◽  
Auto Regressive ◽  
Insurance Penetration ◽  
The Government

This study analyses the long- and short-term dynamics of the determinants of insurance penetration for the period 1999Q1 to 2019Q4 in 15 West African countries. The panel auto regressive distributed lag model was used on the quarterly data gathered. A cointegrating and short-run momentous connection was discovered between insurance penetration along with the independent variables, which were education, productivity, dependency, inflation and income. The error correction term’s significance and negative sign demonstrate that all variables are heading towards long-run equilibrium at a moderate speed of 56.4%. This further affirms that education, productivity, dependency, inflation and income determine insurance penetration in West Africa in the long run. In addition, the short-run causality revealed that all the pairs of regressors could jointly cause insurance penetration. The findings of this study recommend that the economy-wide policies by the government and the regulators of insurance markets in these economies should be informed by these significant factors. The restructuring of the education sector to ensure finance-related modules cut across every faculty in the higher education sector is also recommended. Furthermore, Bancassurance is also recommended to boost the easy penetration of the insurance sector using the relationship with the banking sector as a pathway.

China’s shadow banking sector: beneficial or harmful to economic growth?

2015 ◽  
Vol 7 (4) ◽  
pp. 421-445 ◽  
Author(s):  
James R. Barth ◽  
Tong Li ◽  
Wen Shi ◽  
Pei Xu
Keyword(s):  
Economic Growth ◽  
Banking Sector ◽  
Commercial Banking ◽  
Global Perspective ◽  
Shadow Banking ◽  
Content Type ◽  
Wide Range ◽  
Recent Developments ◽  
Major Factors ◽  
Made In

Purpose – The purpose of this paper is to examine recent developments pertaining to China’s shadow banking sector. Shadow banking has the potential not only to be a beneficial contributor to continued economic growth, but also to contribute to systematic instability if not properly monitored and regulated. An assessment is made in this paper as to whether shadow banking is beneficial or harmful to China’s economic growth. Design/methodology/approach – The authors start with providing an overview of shadow banking from a global perspective, with information on its recent growth and importance in selected countries. The authors then focus directly on China’s shadow banking sector, with information on the various entities and activities that comprise the sector. Specifically, the authors examine the interconnections between shadow banking and regular banking in China and the growth in shadow banking to overall economic growth, the growth in the money supply and the growth in commercial bank assets. Findings – Despite the wide range in the estimates, the trend in the size of shadow banking in China has been upward over the examined period. There are significant interconnections between the shadow banking sector and the commercial banking sector. Low deposit rate and high reserve requirement ratios have been the major factors driving its growth. Shadow banking has been a contributor, along with money growth, to economic growth. Practical implications – The authors argue that shadow banking may prove useful by diversifying China’s financial sector and providing greater investments and savings opportunities to consumers and businesses throughout the country, if the risks of shadow banking are adequately monitored and controlled. Originality/value – To the authors’ knowledge, this paper is among the few to systematically evaluate the influence of shadow banking on China’s economic growth.

Contemporaneous or causal? Evaluating the triumvirate of insolvency risk, capitalization and efficiency in Indian commercial banking

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Navendu Prakash ◽  
Shveta Singh ◽  
Seema Sharma
Keyword(s):  
Cost Efficiency ◽  
Banking Sector ◽  
Generalized Method Of Moments ◽  
Commercial Banking ◽  
Seemingly Unrelated Regression ◽  
Bank Capital ◽  
Short Term ◽  
Content Type ◽  
Insolvency Risk

PurposeThis paper empirically examines the short-term and long-term associations between risk, capital and efficiency (R-C-E) in the Indian banking sector across 2008–2019 to answer the presence of causation or contemporaneousness in the R-C-E nexus.Design/methodology/approachThe paper focuses on three objectives. First, the authors determine short-term causality in the risk–efficiency relationship by studying the simultaneous influence of a wide array of banking risks on DEA-based technical and cost efficiency in static and dynamic situations. Second, the authors introduce bank capital and contemporaneously determine the interplay between R-C-E using seemingly unrelated regression equation (SURE) and three-staged least squares (3SLS). Last, the authors assess stability in inter-temporal associations using Granger causality in an autoregressive distributed lag (ARDL) generalized method of moments (GMM) framework.FindingsThe authors contend that high capital buffers reduce insolvency risk and increase bank stability. Technically efficient banks carry lesser equity buffers, suggesting a trade-off between capital and efficiency. However, capitalization makes banks more technically efficient but not cost-efficient, implying that over-capitalization creates cost inefficiencies, which, in line with the cost skimping hypothesis, forces banks to undertake risk. Concerning causal relationships, the authors conclude that inefficiency Granger-causes insolvency and increases bank risk. Further, steady increases in capital precede technical and cost efficiency improvements. The converse also holds as more efficient banks depict temporal increases in capitalization levels.Originality/valueThe paper is perhaps the first that acknowledges the influence of the “time” perspective on the R-C-E nexus in an emerging economy and advocates that prudential regulations must focus on short-term and long-term intricacies among the triumvirate to foster a stable banking environment.

scholarly journals Banking sector competitiveness

2021 ◽  
Vol 10 (2) ◽  
pp. 195-202
Author(s):  
Champika Liyanagamage
Keyword(s):  
Sri Lanka ◽  
Business Models ◽  
Banking Sector ◽  
Positive Impact ◽  
Balance Sheet ◽  
Estimation Procedure ◽  
Commercial Banking ◽  
Sri Lankan ◽  
Level Data ◽  
Banking Institutions

Despite core banking, banks also engage in off-balance-sheet (OBS) market activities. In many developed banking industries, OBS activities have grown to be significant during the last two decades. This paper provides rather scarce evidence on the competitiveness among banks for OBS activities and its impact on the degree of banking sector competition in Sri Lanka. Panzar-Ross H statistic approach employing in this study to estimate bank competition used a comprehensive set of bank-level data of the whole commercial banking sector in Sri Lanka covering the period 1996-2018. The first-round analysis of the study uncovers substantial differences among banks concerning the OBS activities. EGLS panel estimation procedure applied in this study provides evidence for a lower level of competitiveness among Sri Lankan banks for OBS activities. More interestingly, the findings further reveal that the degree of competitiveness for OBS activities has a significant positive impact on the overall competitiveness of the banking sector in Sri Lanka.  These results suggest banking institutions re-visit their business models with greater emphasis on nonconventional banking activities in enhancing bank-level efficiency and hence positively contributing to the overall competitiveness of the banking sector.

scholarly journals The impact of risk factors on the financial performance of the commercial banking sector in Barbados

2018 ◽  
Vol 7 (1) ◽  
pp. 76-93 ◽  
Author(s):  
Anthony Wood ◽  
Shanise McConney
Keyword(s):  
Risk Factors ◽  
Credit Risk ◽  
Financial Performance ◽  
Banking Sector ◽  
Negative Impact ◽  
Interest Rate Risk ◽  
Commercial Banking ◽  
Country Risk ◽  
Risk Variable ◽  
The Impact

The objective of this paper is to determine the impact of risk factors on the financial performance of the commercial banking sector in Barbados using quarterly data for the period 2000 to 2015. The empirical results indicate that Capital Risk, Credit Risk, Liquidity Risk, Interest Rate Risk and Operational Risk have statistically significant impacts on financial performance. The only risk variable which does not derive this result is Country Risk. In addition, of those variables which proxy external factors, only GDP Growth has a statistically insignificant influence on financial performance. Credit risk exerted a negative impact on the banks’ financial performance, thus the banks must ensure they adopt appropriate measures to minimise the impact of this risk. Higher levels of capital impacted positively on the banking sector’s profitability. This paper is the first effort employing such an extensive dataset based on Barbados’ commercial banking sector and shows the main factors that influence commercial banks’ financial performance in this developing economy.

scholarly journals Does Market Power Affect Banking Dividend Policy? Evidence from Nepal

2021 ◽  
Vol 1 (4) ◽  
pp. 297-306
Author(s):  
Sahadev Bhatt
Keyword(s):  
Market Power ◽  
Banking Sector ◽  
Market Competition ◽  
Influencing Factor ◽  
Commercial Banking ◽  
Agency Conflicts ◽  
Dividend Payment ◽  
Lerner Index ◽  
Asset Growth ◽  
Structural Measure

We attempt to explain how market power impacts bank dividend payment behaviors in Nepal by taking the sample from the commercial banking sector employing a panel data regression model. Using the Lerner Index (LI), a non-structural measure of market power or lack of competition, we found that market power inversely but statistically insignificantly affect dividend payment. This finding leads us to conclude that market power-a proxy of more or less competition is not an important and influencing factor to the dividend decisions in commercial banking sectors signifying that competition does not seem helpful in mitigating agency conflicts. It is also concluded that banking dividend payouts are not the result of the punitive influence of product market antagonism. Further, among other firm-specific determinants, bank size and leverage significantly positively whereas asset growth significantly negatively affect the dividend decision. However, profitability is found insignificant determinant of dividend payment. The paper enriches and contributes to the literature on banking dividend payout and helps to identify the key factors that affect banking dividend decision-making.  Keywords : Banks, Market competition, Market power, Lerner Index, Nepal

scholarly journals المحددات التي تواجه نظام الرقابة الداخلية في بيئة المصارف التجارية

2017 ◽  
Vol 3 (4) ◽  
pp. 179
Author(s):  
Journals UHD ◽  
Dana Akram Faqe Mahmood ◽  
Shilan Arf Ahmad
Keyword(s):  
Control Systems ◽  
Internal Control ◽  
Commercial Banks ◽  
Banking Sector ◽  
Commercial Banking ◽  
Negative Effects ◽  
Internal Auditor ◽  
Regulatory Systems ◽  
Policies And Procedures ◽  
Banking Institutions

This study was conducted to examine the work of internal control systems in banking institutions. It focused on studying the determinants facing the internal censorship system in the commercial banking sector by identifying the deficiencies and shortcomings in the regulatory systems and their negative effects from financial and administrative failure, the overall weak performances and etc, and also by determining the main reasons and obstacles that prevents the application from development of the internal censorship systems in commercial banks. A practical study had been made on a sample of the commercial banks operating in Sulaymaniyah governorate .In order to achive the goal, five commercial banks were used to collect the data from. The researchers used questionairre while collecting data in which they entered the information and data were processed automatically and through statistical models in order to test hypotheses and prove them. The results of the statistical analysis showed that there is a strong correlation between the variables of the research hypothesis and the internal censorship's objectives and the constraints facing to their application in the commercial banking sector of a degree at (0.607). The results showed that the increase of the determinants of the work of internal censrorship systems affected the achievement of the objectives that pursuied by the internal censorship in commercial banks in specifics. The researchers reccomended that there should be a commitments to the laws , accounting policies and procedures that applied to protect the assets especially by the commercial bank's management and to detect errors , fraud and manipulation to support the independency of the work of internal auditor and activate its role to achieve the objectives targeted by the internal censorship systems in commercial banks.

USER COSTS, THE FINANCIAL FIRM, AND MONETARY AND REGULATORY POLICY

2019 ◽  
Vol 24 (6) ◽  
pp. 1547-1573
Author(s):  
Maksim Isakin ◽  
Apostolos Serletis
Keyword(s):  
Financial Services ◽  
Deposit Insurance ◽  
Banking Sector ◽  
Financial Regulation ◽  
Policy Instruments ◽  
Commercial Banking ◽  
User Cost ◽  
Holding Costs ◽  
User Costs ◽  
Financial Firm

We investigate how key monetary policy instruments and financial regulation affect the banking firm. We take the user-cost approach to the construction of prices for financial services and use quarterly data on the U.S. commercial banking sector, over the period from 1992 to 2016, obtained from the Federal Deposit Insurance Corporation. We use the symmetric generalized Barnett variable profit function to derive demands for and supplies of monetary and nonmonetary goods and provide evidence consistent with neoclassical microeconomic theory. We find that the compensated price elasticities of banking technology are small in magnitude. Yet a hypothetical policy experiment shows that even small changes in the holding costs of financial goods can result in significant changes in user costs and the quantities demanded and supplied.

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