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U. Zh. Kurmankozhoeva. "COMMERCIAL BANK ASSET MANAGEMENT IN THE KYRGYZ REPUBLIC." Herald of KSUCTA n a N Isanov, no. 4 (December 16, 2019): 693–97. http://dx.doi.org/10.35803/1694-5298.2019.4.693-697.
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This article discusses the main indicators characterizing the quality of the assets of a commercial bank, analyzes these indicators using the banks of the Kyrgyz Republic as an example. The methods of bank asset management are described. Based on the data of the National Bank, a study is made of the asset structure of commercial banks of the Kyrgyz Republic. A list of regulatory acts governing the management of bank assets is provided.
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Abd. Majid, M. Shabri, Said Musnadi, and Indra Yadi Putra. "A Comparative Analysis of the Quality of Islamic and Conventional Banks’ Asset Management in Indonesia." Gadjah Mada International Journal of Business 16, no. 2 (2014): 185. http://dx.doi.org/10.22146/gamaijb.5463.
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This research empirically and comparatively examines the quality of conventional and Islamic banks’ asset management in Indonesia during the period 2009-2011. Four general conventional banks [i.e., Bank Mandiri Indonesia (BMI), Bank Rakyat Indonesia (BRI), Bank Central Asia (BCA), and Bank Nasional Indonesia (BNI)] and four Islamic banks (Bank Muamalat, Bank Syariah Mandiri, Bank Syariah Mega Indonesia, and Bank Syariah BRI) were, respectively, explored. Specifically, the purpose of this study is to compare the quality of the Islamic and conventional banks’ asset management with the CAMEL (capital, asset, management, earning, and liquidity) method. It also attempts to analyse the influences of the ROA (Return on Asset), TLTA (Total Loan to Total Assets), and OITL (Operating Income to Total Liabilities) on the quality of the banks’ asset management. The CAMEL method was used to evaluate the quality level of the banks’ asset management, while the multiple regression analysis was then adopted to explore the determinants of the quality of the banks’ asset management. The study documented that Bank Syariah BRI was the best performing bank, with the highest CAMEL score of 50.33, while Bank Mandiri Indonesia was the worst performer with the lowest CAMEL score of 26.33. As a group, the Islamic banks were found to have better rankings, i.e., positions 1, 2, 3, and 6, while the conventional banks were found in 4, 5, 7, and 8, respectively. The study proved that the Islamic banks have a better asset management quality compared to their conventional counterparts. The Islamic banks were also proved to be better able to withstand the risks, particularly the financing risk.
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Tanwar, Jyoti, Arun Kumar Vaish, and N. V. M. Rao. "MATHEMATICAL MODELING OF ASSET LIABILITY MANAGEMENT IN BANKS USING GOAL PROGRAMMING AND AHP." Indian Journal of Finance and Banking 4, no. 4 (2020): 1–19. http://dx.doi.org/10.46281/ijfb.v4i4.899.
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Asset Liability Management has gained popularity in the banking sector. Earlier banks focused on asset allocation, but now the management of assets and liabilities is equally essential. Asset liability management targets the optimum distribution of funds in assets and managing liabilities so that banks can earn higher profits and minimize risk. In this paper, the optimization of assets and liabilities of Indian banks has been concentrated using mathematical models. Combining the Analytical Hierarchy Process (AHP) and Goal Programming (GP) model has been used to solve the optimization problem. AHP is a multi-criteria decision-making approach for deriving priority weights. Goal Programming is a linear programming model to solve complex issues having multiple objectives. In this paper, the primary data gathered from Bank senior managers have been analyzed using the AHP approach to derive weights for criteria. These weights are assigned to goals in goal programming to prioritize the goals. Secondary data on OBC bank is used in goal programming from 2010-2019 collected from OBC bank's annual reports and RBI websites. The findings show that OBC bank has the scope of improving its assets and liabilities position to increase its profit and minimize the risk. The model generates an optimum balance sheet that achieves the set goals and satisfies all the statutory and planning constraints. The same model can be useful for scheduled commercial banks in India with modifications concerning banks' targets and controls. The model developed in this paper is helpful for bank managers in planning and forecasting. AHP and GP's combined approach is unique in this paper, which uses experts' knowledge and applies it in the model. The model is created on the bank's realistic goals and constraints after carefully considering the issues faced by bank officials. The paper is limited to the Indian Banking system as other countries have different balance sheet structures and constraints.
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Ahmed Mareai Senan, Nabil, Fozi Ali Belhaj, Ebrahim Mohammed Al-Matari, Mamdouh Abdulaziz Saleh Al-Faryan, and Eissa A. Al-Homaidi. "Capital adequacy determinants of Indian banks listed on the Bombay Stock Exchange." Investment Management and Financial Innovations 19, no. 2 (2022): 167–79. http://dx.doi.org/10.21511/imfi.19(2).2022.14.
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This study examines the influence of corporate-specific factors and external factors on capital adequacy of Indian banks listed on the Bombay Stock Exchange (BSE). This study used a GMM estimation (pooled, fixed, and random) for the period 2009–2018 to study thirty-seven Indian listed commercial banks. Banks’ capital adequacy (CAAD) is used as a dependent variable measured by equity to total assets. While corporate specifics factors include bank size, asset quality, liquidity ratio, deposit ratio, asset management, operating efficiency, return on assets, net interest margin, and non-interest income, external factors are economic activity, exchange rate, and interest rate. The results of this paper found that the deposit ratio, asset management, bank size, and operating efficiency are the main factors influencing banks’ CAAD of Indian listed firms during the period of the study. The outcomes revealed that the deposits ratio, asset management, and bank size have a negative and significant influence on banks’ CAAD, while operating efficiency has a positive and significant impact on CAAD. In terms of external indicators, the results revealed that gross domestic product and interest rate have a negative and significant effect on CAAD of Indian listed banks, except that the exchange rate has a positive and significant influence on CAAD. AcknowledgmentThe authors would like to thank the Arab Open University, Kingdom of Saudi Arabia, for supporting this research paper.
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Phuanerys, Eliza Christabella, and Yanuar Yanuar. "Faktor-Faktor yang Memengaruhi Profitabilitas Bank Umum Syariah di Indonesia." Jurnal Manajemen Bisnis dan Kewirausahaan 4, no. 3 (2020): 06. http://dx.doi.org/10.24912/jmbk.v4i3.7908.
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This study was conducted to analyze the effect of the Capital Adequacy, Asset Quality, Management Efficiency and Liquidity Management ratios on profitability proxied by bank Return On Assets (ROA), by analyzing the annual financial statements that have been published in 2013-2017. The variables used in analyzing the financial statements of Sharia Commercial Banks that are sampled are Asset Quality which is proxied by Non Performing Financing (NPF), Liquidity Management which is proxied by Financing to Debt Ratio (FDR), Management Efficiency proxied by Net Operating Margin (NOM), and Capital Adequacy proxied by Capital Adequacy Ratio (CAR). The sample in this study was 11 Islamic commercial banks for 5 years, namely 2013-2017. The results showed that Capital Adequacy, Asset Quality, and Liquidity Management significantly influenced the profitability of Islamic commercial banks. Whereas Management Efficiency does not affect the profitability of Islamic commercial banks. Based on these results, Sharia Commercial Banks in Indonesia must increase capital, reduce problematic financing by improving internal processes, and increase bank liquidity by increasing fundraising.
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Usman, Bahtiar, and Henny Setyo Lestari. "Determinants of Bank Performance in Indonesia." Jurnal Minds: Manajemen Ide dan Inspirasi 6, no. 2 (2019): 193. http://dx.doi.org/10.24252/minds.v6i2.11282.
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This study aims to examine the determinants of commercial banks’ performances in Indonesia in the period 2008-2017 by their return on assets. Capital adequacy, asset quality, management efficiency and liquidity, and gross domestic product functioned as the predictors. The sample of this study was 25 conventional banks meeting the criteria of the purposive sampling method. The panel data with Eviews shows that asset quality has a negative effect and management efficiency has a positive impact on bank performance. Capital adequacy, liquidity, and gross domestic product growth rate do not affect the bank's performance. Managers need to tighten lending, carry out credit restructuring and manage the balance between assets and liabilities and, supervise credit.
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Nugrohowati, Rindang Nuri Isnaini. "PERBANDINGAN TINGKAT PROFITABILITAS DAN LIKUIDITAS DARI ASSET-LIABILITIES MANAGEMENT PADA BANK SYARIAH DAN BANK KONVENSIONAL." JESI (Jurnal Ekonomi Syariah Indonesia) 5, no. 1 (2016): 1. http://dx.doi.org/10.21927/jesi.2015.5(1).1-11.
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Abstract The banking sector has a very important position for the economic systemof a country. The banking system, which is part of the financial system willaffect the course of the economic system as a whole. If the banking system isweak then the system will also be weak economy. Banking is an intermediaryinstitution is the institution that channel funds from surplus funds (surplusunits) to the sectors that lack of funds (defi cit units). With the banking economic actors in need of funds can be met so that the economy can continue to run. In this study will specifi cally analyze the comparison of the level of profi tability of the asset-liability management in Islamic banks and conventional banks are seen from the return on assets and return on equity rises. It also will be studied comparative level of liquidity in Islamic banks and conventional banks are seen from the loan to deposit ratio and Capital Adequacy Ratio. By Hyphothesis is as follows : Ha1: there are differences in the level of profitability of the asset-liabilitymanagement in Islamic banks and conventional banks are seen from the return on assets and return on equity Ha2: there are differences in the level of liquidity in Islamic banks andconventional banks are seen from the loan to deposit ratio and Capital Adequacy Ratio Data analysis has been done obtained the following conclusions, based onmeans testing compare with test Independent-Samples t-test showed that the level of tability seen from ROA and ROE between Islamic Bank and Bank Konvensiona show any signifi cant difference. This is demonstrated by tests of signifi cance 0.02 0.05 for FDR, while for the signifi cance test CAR of 0.38> 0.05. Keyword: Profi tabilitas, Likuiditas, Asset Liabilities Management, Bank Syariah
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Ali, Peter, Peter N. O. N. O. Njoku, John N. N. Ugoani, O. C. Nwaorgu, and Okanta S. Ukeje. "Cash Management and Bank’s Financial Performance: Evidence from selected Deposit Money Banks in Nigeria." AFRE (Accounting and Financial Review) 3, no. 2 (2021): 180–89. http://dx.doi.org/10.26905/afr.v3i2.5450.
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This study empirically examined the effects and implications of cash management of DMBs in Nigeria. The variables studied were Cash to total asset, Operating cash to total asset, Investing cash to total asset, Financing cash to total asset, Bank size, Bank age, proxied for cash management and Return on Asset used to represent financial performance. Data used for this study were from secondary sources and were generated from the annual reports and accounts of the selected DMBs for the period 2014–2018. The results show that while operating cash to total asset of bank, investing cash to total asset and bank size have no significant effect on financial performance of DMBs, financing cash to total asset and bank age have a significant and positive effect on financial performance of deposit money bank (DMBs). However, cash to total asset has a significant negative effect on financial perfor-mance of banks. The study concludes that cash positions, which can lead to liquidity risk has to be managed because it has tendency to compound other risks. It further highlighted that adequate attention should be paid on the use and reserves of cash among banks in Nigeria. This study recommends that banks should adopt optimum cash management model for efficiency and effectiveness. Stringent regulatory policies in this regard must be reviewed in such a way that they can be relaxed, to encourage effective liquidity manage-ment measures.
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Hollingsworth, Danny P., and John T. Rose. "Tax Reform And Bank Asset Quality: Did 1986 Tax Law Changes Contribute To Banks Loan Problems?" Journal of Applied Business Research (JABR) 11, no. 4 (2011): 15. http://dx.doi.org/10.19030/jabr.v11i4.5843.
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The escalation of bank loan losses in the mid/late 1980s, attended by a marked decrease in banking industry profits and an increase in bank failures, has raised numerous questions about the factor contributing to these events. The present study continues this inquiry by examining the effects of the Tax Reform Act of 1986 (TRA86) on the quality of banks assets in the late 1980s. Specifically, the study seeks to attribute changes in bank asset quality following enactment of TRA86 to 1) the two major provisions of the law targeted at banks, namely, interest expense allocable to tax-exempt obligations and the tax reserve for bad debts, particularly bad debts of large banks, along with 2) the pre-TRA86 level of real estate loans that were devalued by other provisions of the statute. Using alternative measures of asset quality, a single-equation regression analysis was applied to a sample of 205 large commercial banks. Empirical results indicate some linkage between TRA86 and changes in bank asset quality during the late 1980s, though not in all areas examined.
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Ben Said, Houda, and Zouari-Hadiji Rim. "Tunisian bank asset-liability management: A canonical correlation analysis." Corporate Ownership and Control 15, no. 3-1 (2018): 230–38. http://dx.doi.org/10.22495/cocv15i3c1p7.
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The aim of this paper is to analyze asset-liability management behaviour in Tunisian banks between 2000 and 2014. The liberalization process in the Tunisian economy coupled with global developments exposed banks for various kinds of risks (interest rate risk, liquidity risk, exchange risk, operational risk etc...) which have a direct impact on their profitability and efficiency. Then asset liability management is one of a most important tool for decision making that sets out to maximize stakeholder value and an instrument to measure the sustainability of the financial sector in a country. A sample consisting of public, private, and foreign banks operating in the Tunisian territory was considered and the multivariate statistical technique, canonical correlation analysis has been used to capture the nature and strength of the relationship between the assets and liabilities in these banks. Assets analyzed were subdivided into fixed assets, liquid assets, short-term loans, long-term loans, short-term securities and long-term securities; and liabilities into net worth, borrowings, short-term deposits and long-term deposits. From the analysis, different degrees of the association have been found among various constituents of assets and liabilities and among banks. In most cases, there has been a poor and judicious matching of assets and liabilities in terms of their explicit cost and revenue as well as their maturity and liquidity. It is further observed that most Tunisian banks were asset-managed: these banks were actively managing assets and liabilities and were dependent on how well the assets are managed.
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Budiwati, Hesti. "Manajemen Kualitas Aset Produktif Dan Pengaruhnya Terhadap Laba Bank Pada Bank Perkreditan Rakyat di Indonesia." RELASI : JURNAL EKONOMI 17, no. 1 (2021): 56–75. http://dx.doi.org/10.31967/relasi.v17i1.411.
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Managing the bank risk well are very needed so that the bank can operate smoothly. One of the important bank risk to managed well is bank asset quality risk. The banks are required to be careful and wiser in manage these asset quality risk. The object of this study is to obtain evidence of the effect of productive asset quality management on bank profit. The empirical studies conducted on rural banks in Indonesia. As the independent variable is productive asset quality consist of classified productive asset, productive asset quality and non-performing loan, while as the dependent variable is bank profit measured by return on asset. Return on asset of 89,6% explained by classified productive asset, productive asset quality and non-performing loan. While the rest return on asset of 10,4% effect by other variables that not examined in this study.
 Keywords: Classified Productive Asset, Productive Asset Quality, Non-performing Loan, Return on Asset.
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Ifeacho, Christopher, and Harold Ngalawa. "Performance Of The South African Banking Sector Since 1994." Journal of Applied Business Research (JABR) 30, no. 4 (2014): 1183. http://dx.doi.org/10.19030/jabr.v30i4.8663.
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This study investigates the impact of bank-specific variables and selected macroeconomic variables on the South African banking sector for the period 1994-2011 using the capital adequacy, asset quality, management, earnings, and liquidity (CAMEL) model of bank performance evaluation. The study employs data in annual frequency from South Africas four largest banks, namely, ABSA, First National Bank, Nedbank, and Standard Bank. These banks account for over 70% of South Africas banking assets. Using return on assets (ROA) and return on equity (ROE) as measures of bank performance, the study finds that all bank-specific variables are statistically significant determinants of bank performance. Specifically, the study shows that asset quality, management quality, and liquidity have a positive effect on both measures of bank performance, which is consistent with a priori theoretical expectations. Capital adequacy, however, exhibits a surprising significant negative relationship with ROA, while its relationship with ROE is significant and positive as expected. Except for interest rates (in the ROA model), unemployment rate (in the ROA model), and the rate of inflation (in the ROE model), the rest of the macroeconomic variables are statistically insignificant. The study reveals that bank performance is positively related to interest rates and negatively related to unemployment rates and interest rates.
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Donkor-Hyiaman, Kenneth, Esther Narhkwor Terkper, Eric Paul Tudzi, De-Graft Owusu-Manu, and Benjamin Ajabuin. "Corporate real estate management and bank profitability." Journal of Research in Emerging Markets 3, no. 4 (2021): 35–47. http://dx.doi.org/10.30585/jrems.v3i4.651.
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Acquiring property for any business is capital intensive and for that matter, strategically managing such assets is considered equally important. This paper provides an analysis of the value-adding attributes of corporate real estate management (CREM) and bank performance in Ghana. The multiple regression method was applied to a cross-section of both primary and secondary data sourced from 25 commercial banks in Ghana. The study shows that the banks identify with the value-adding attributes of corporate real estate asset management even though there are variations in the level of importance to individual banks. These variations are attributable to the unique mandates of the banks. Further analysis shows that CREM has significantly positive impacts on bank profitability by strategies that help to increase innovations, increase productivity, and promote marketing and sales. The finding suggests that optimizing these CREM strategies could help increase bank profits.
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Godswill, Osuma, Ikpefan Ailemen, Romanus Osabohien, Ndigwe Chisom, and Nkwodimmah Pascal. "Working capital management and bank performance: empirical research of ten deposit money banks in Nigeria." Banks and Bank Systems 13, no. 2 (2018): 49–61. http://dx.doi.org/10.21511/bbs.13(2).2018.05.
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Working capital management is germane for the success of the banking industry in Nigeria, especially the current state of the sector, which is engulfed with the effect of the global decline in oil price that has resulted in non-performing loans, deterioration of the bank asset quality, laying-off of staff amongst others. This is one of the reasons why the profitability of the banking sector deeply depends on the efficient management of a bank’s working capital. Therefore, the objective of this study is to examine how profitability of banks can be enhanced through the working capital management. To empirically carry out the analysis, panel data which consist of ten (10) deposit money banks in Nigeria for seven years (2010–2016) employing the panel fixed effect, panel random effect and the pooled OLS for the two models, which were used as proxies for bank profitability, which includes return on asset (ROA) and return on equity (ROE) to examine the best measure for bank profitability, with the indicators of working capital; net interest income, current ratio, profit after tax, and monetary policy rate. Results of the study showed that working capital management has a significant effect on the profitability of the selected banks and that return on asset is a better measure for bank profitability. Therefore, the study recommends that there should be a periodic review of the minimum capital base of the Nigerian deposit money banks so as to mitigate the effects of inflation and inculcate the consequence of time value of money, because the purchasing power of one (₦1) naira or one ($1) dollar today would not be sufficient to purchase what it can purchase today for tomorrow.
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Szegö, Giorgio P. "Bank asset management and financial insurance." Journal of Banking & Finance 10, no. 2 (1986): 295–307. http://dx.doi.org/10.1016/0378-4266(86)90012-9.
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Choirunnisak, Choirunnisak. "Application of the Concept of Asset and Liability Management (ALMA) in the Islamic Banking System." Islamic Banking : Jurnal Pemikiran dan Pengembangan Perbankan Syariah 7, no. 2 (2022): 333–50. http://dx.doi.org/10.36908/isbank.v7i2.337.
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This study discusses the application of the concept of asset and liability management (ALMA) in the banking system. The method used in this research is library research with a qualitative approach, where the data are obtained from books, journals, articles and the like that discuss the theme. After that, it was validated, and analyzed descriptively. The results of this study are: Application of Asset and Liability Management in banking institutions, both Islamic banks and conventional banks must go through an assessment of the budget, make income plans, evaluate investment performance in the past, unify the distribution of bank assets and liabilities and implement asset and financial strategies obligation
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Chatterjee, Chanchal, and Paromita Dutta. "Exploring the Linkage between Profits and Asset–Liability Management." Paradigm 20, no. 2 (2016): 131–42. http://dx.doi.org/10.1177/0971890716670707.
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The article uses panel data regression on a sample of 26 public sector and 20 private sector banks operating in India over the period 2004–2005 to 2012–2013 in order to empirically examine the relationship between profits and asset–liability (A–L) composition of Indian banks. The sample was initially split into public sector and private sector banks. Earning before tax (EBT) of public sector banks appear to be generated by all the assets under the asset portfolio while, in private sector banks, the EBT seems to be produced by loans and advances and deposits and placings to banks. From liabilities’ perspective, the ‘short-term funding’ appears to be the cheapest for both the bank groups. The sample was then split into high-profit and low-profit banks. The results show that, compared to the high-profit banks, low-profit banks experience higher rate of return on loans and advances, investments and fixed assets. The study does not find that high-profit banks always enjoy relatively cheaper cost of funding than low-profit banks.
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Marozva, Godfrey. "Asset liquidity and bank profitability in South Africa." Corporate Ownership and Control 11, no. 1 (2013): 745–53. http://dx.doi.org/10.22495/cocv11i1c8art5.
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This paper empirically analyses the relationship between asset liquidity and bank profitability for South African banks for the period between 1994 and 2011. The study employs Ordinary Least Squares (OLS) and the Autoregressive Distributed Lag (ARDL)-bound testing approach to examine the linkage between return on assets (ROA) and liquidity, and the nexus between return on equity (ROE) and liquidity to capture the short-run and long-run dynamics. The study observes that there is neither a significant relationship between ROE and liquidity nor a relationship between ROE and liquidity. These observations hold for both the short-run and long-run. Banks are recommended to embrace the asset liability framework in their analysis and management of liquidity as the asset only approach is insufficient and misleading
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Shukla, Ankur, Sivasankaran Narayanasamy, and Ramachandran Krishnakumar. "Impact of board size on the accounting returns and the asset quality of Indian banks." International Journal of Law and Management 62, no. 4 (2020): 297–313. http://dx.doi.org/10.1108/ijlma-12-2018-0271.
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Purpose The purpose of the paper is to explore the impact of board size on the accounting returns and asset quality of Indian banks. Design/methodology/approach This paper uses ordinary least squares regression, robust regression and panel data methods for estimation, based on data collected for a sample of 29 Indian banks that are listed on the National Stock Exchange (NSE) and form part of the NSE-500 index over a period of eight financial years 2009-2016. The data pertaining to the board size of the sample banks is collected from the annual reports of banks, whereas the data relating to return on assets (ROA) and ratio of the gross non-performing assets to total assets and control variables (bank age and bank size) is extracted from ACE Equity database. Findings This paper concludes that the size of the governing board has a positive impact on the accounting returns (measured through ROA) of the Indian banks. Further, board size is observed to be insignificant in determining the asset quality of Indian banks. Originality/value This paper contributes to the literature and practitioners in a number of ways. First, to the best of the authors’ knowledge, this is the first study on the impact of board size on the accounting returns and asset quality of Indian banks. The findings of the study contribute new theoretical insights to the body of knowledge on the influence of the size of the board, which may be useful for future researchers. Second, banks may enhance their financial performance by taking cognizance of the findings of this study. Finally, equity investors may make use of the findings of this article in deciding on whether to invest in a bank’s stock/lend to the bank based on board size of the bank.
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Tanwar, Jyoti, Arun Kumar Vaish, and NVM Rao. "OPTIMIZING BALANCE SHEET FOR BANKS IN INDIA USING GOAL PROGRAMMING." International Journal of Accounting & Finance Review 6, no. 2 (2021): 81–101. http://dx.doi.org/10.46281/ijafr.v6i2.1082.
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In earlier years, there was abundance of funds in banks in the form of demand and savings deposits. Hence, the focus of banks was mainly on asset management. But intense competition and volatility of interest rate due to banking reforms reduced the availability of low-cost funds and therefore, banks focused on liability management as well. These pressures call for structured and comprehensive measures and not just ad hoc action. This is how banks started to concentrate more on the management of both sides of the balance sheet. As a result, the concept of asset-liability management originated in India and introduced in the Indian banking industry since 1st April 1999 to administer the risk management aspects. This paper attempts to optimize assets and liabilities of banks using goal programming technique. Secondary data is collected from annual reports of Allahabad bank from 2010-2019 and RBI website is used for modelling. The findings show that in Allahabad bank, goal programming help in achieving optimization and increase profitability. The model incorporating constraints and set objectives. It model can support banks in decision making process, planning, budgeting, and forecasting. An attempt is made to use realistic goals and constraints after discussing with bank officials.
 JEL Classification Codes: C61, G21, G32.
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Rutkauskas, Aleksandras Vytautas, and Jelena Stankeviciene. "INTEGRATED ASSET AND LIABILITY PORTFOLIO AS INSTRUMENT OF LIQUIDITY MANAGEMENT IN THE COMMERCIAL BANK." Journal of Business Economics and Management 7, no. 2 (2006): 45–57. http://dx.doi.org/10.3846/16111699.2006.9636123.
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Liquidity, or the ability to fund increases in assets and meet obligations as they come due, is crucial to the ongoing viability of any banking organization. Therefore, managing liquidity is among the most important activities conducted by banks. Liquidity management model proposed by the authors can reduce the probability of serious problems. Indeed, the importance of liquidity transcends the individual bank, since a liquidity shortfall at a single institution can have system‐wide repercussions. For this reason, the analysis of liquidity requires bank management not only to measure the liquidity position of the bank on an ongoing basis but also to examine how funding requirements are likely to evolve under various scenarios, including adverse conditions. The authors have focused on developing a greater understanding of the way in which banks can manage their liquidity using a broad potential of integrated asset and liability portfolio. As instrument for the solution of the assessed problem the integrated total commercial bank asset and liability structure formation and management when useful occurrence of integrated structure and every outcome is followed with some guarantee to occur was chosen. An academic example is shown as an illustration for ideas analyzed. The formality and sophistication of the process used to manage liquidity depends on the size and sophistication of the bank, as well as the nature and complexity of its activities. The principles focused in the paper have broad applicability to all banks. In particular, good management information systems, analysis of net funding requirements under alternative scenarios, diversification of funding sources, and contingency planning are crucial elements of strong liquidity management at a bank of any size or scope of operations.
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Muller, Grant E., and Peter J. Witbooi. "An Optimal Portfolio and Capital Management Strategy for Basel III Compliant Commercial Banks." Journal of Applied Mathematics 2014 (2014): 1–11. http://dx.doi.org/10.1155/2014/723873.
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We model a Basel III compliant commercial bank that operates in a financial market consisting of a treasury security, a marketable security, and a loan and we regard the interest rate in the market as being stochastic. We find the investment strategy that maximizes an expected utility of the bank’s asset portfolio at a future date. This entails obtaining formulas for the optimal amounts of bank capital invested in different assets. Based on the optimal investment strategy, we derive a model for the Capital Adequacy Ratio (CAR), which the Basel Committee on Banking Supervision (BCBS) introduced as a measure against banks’ susceptibility to failure. Furthermore, we consider the optimal investment strategy subject to a constant CAR at the minimum prescribed level. We derive a formula for the bank’s asset portfolio at constant (minimum) CAR value and present numerical simulations on different scenarios. Under the optimal investment strategy, the CAR is above the minimum prescribed level. The value of the asset portfolio is improved if the CAR is at its (constant) minimum value.
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Miersch, Enrico, and Nils Schäfer. "Every Cloud has a Silver Lining: On the Relation between Bank-Affiliated Asset Manager Bias and Mutual Fund Fees." Credit and Capital Markets – Kredit und Kapital: Volume 54, Issue 1 54, no. 1 (2021): 79–116. http://dx.doi.org/10.3790/ccm.54.1.79.
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Considering the institutional factors of the German mutual fund market, we analyze equity fund holdings of German retail clients who received financial advice between 2005 and 2014 to investigate whether those investors overweight the bank-affiliated asset manager and if so, whether this bank-affiliated asset manager bias leads to higher fees, i. e. Total Expense Ratios. Our analysis clearly indicates the presence of large bank-affiliated asset management biases for clients of all different banking sectors. Thus, German retail clients follow the biased financial advice they receive from their bank. Surprisingly, this bank-affiliated asset manager bias significantly reduces portfolio costs measured via mutual fund fees. Therefore, German banks disproportionately promote products of bank-affiliated asset managers but this biased advice does not lead to higher portfolio costs.
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Ogˇuzsoy, Cemal Berk, and Sibel Gu¨ven. "Bank asset and liability management under uncertainty." European Journal of Operational Research 102, no. 3 (1997): 575–600. http://dx.doi.org/10.1016/s0377-2217(96)00241-x.
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Walker, David A. "A behavioral model of bank asset management." Journal of Economic Behavior & Organization 32, no. 3 (1997): 413–31. http://dx.doi.org/10.1016/s0167-2681(96)00029-7.
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Kusy, M. I., and W. T. Ziemba. "A Bank Asset and Liability Management Model." Operations Research 34, no. 3 (1986): 356–76. http://dx.doi.org/10.1287/opre.34.3.356.
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Chen, Tsung-Kang, Hsien-Hsing Liao, and Jing-Syuan Ye. "Bank management expertise and asset securitization policies." Journal of Banking & Finance 109 (December 2019): 105667. http://dx.doi.org/10.1016/j.jbankfin.2019.105667.
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Agustin, Imaniar, and Dian Filianti. "PENGARUH CORPORATE GOVERNANCE DAN KINERJA KEUANGAN TERHADAP MANAJEMEN LABA PERBANKAN SYARIAH." Jurnal Ekonomi Syariah Teori dan Terapan 8, no. 4 (2021): 509. http://dx.doi.org/10.20473/vol8iss20214pp509-517.
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ABSTRAKPenelitian ini bertujuan untuk mengetahui variabel-variabel spesifik yang memiliki pengaruh terhadap manajemen laba pada Bank Umum Syariah di Indonesia periode Januari 2013 sampai Desember 2018. Penelitian ini menggunakan metode kuantitatif dengan teknik analisis regresi data panel, meneliti pengaruh Ukuran Dewan Pengawas Syariah, Ukuran Dewan Komisaris, Proporsi Dewan Komisaris Independen, Bank Size, dan Return On Asset (ROA) terhadap Manajemen Laba. Penelitian ini menggunakan data laporan tahunan Bank Umum Syariah di Indonesia. Populasi dalam penelitian ini adalah seluruh Bank Umum Syariah yang terdaftar di Bank Indonesia periode 2013-2018. Penelitian ini menggunakan teknik purposive sampling, dan dari kriteria yang ditetapkan diperoleh 11 Bank Umum Syariah tahun 2013-2018. Hasil dari penelitian dengan model estimasi Random Effect Model (REM) menunjukkan bahwa variabel Ukuran Dewan Pengawas Syariah, Ukuran Dewan Komisaris, Proporsi Dewan Komisaris Independen, Bank Size, dan Return On Asset (ROA) secara simultan berpengaruh terhadap manajemen laba. Secara parsial, variabel Ukuran Dewan Pengawas Syariah, Proporsi Dewan Komisaris Independen dan Return On Asset (ROA) tidak berpengaruh terhadap manajemen laba, variabel Bank Size berpengaruh negatif signifikan terhadap manajemen laba, variabel Ukuran Dewan Komisaris berpengaruh positif dan signifikan terhadap manajemen laba Bank Umum Syariah di Indonesia.Kata Kunci: corporate governance, kinerja keuangan , dan perbankan syariah. ABSTRACTThis study aims to determine specific variables that have an impact on Earnings Management in Sharia Commercial Banks in Indonesia from January 2013 to December 2018. This study used quantitative methods with panel data regression analysis techniques, examining the effect of Sharia Supervisory Board Size, Board of Commissioners Size, The proportion of the Independent Commissioner, Bank Size, and Return On Asset (ROA) on Earnings Management. This study used annual report data for Islamic Commercial Banks in Indonesia. The population in this study were all Sharia Commercial Banks registered with Bank Indonesia for the period 2013-2018. This research used the purposive sampling technique, and from the specified criteria obtained 11 Islamic Commercial Banks in 2013-2018. The results of the study with the estimation model of Random Effect Model (REM) show that the variables of Sharia Supervisory Board Size, Board of Commissioners Size, Proportion of Independent Commissioners, Bank Size, and Return On Asset (ROA) simultans affect earnings management. Partially, in the Syariah Supervisory Board, Proportion of Independent Commissioners, and Return On Asset does not affect earnings management, the Bank Size variable has a significant negative effect on earnings management, the size of the Board of Commissioners variable has a positive and significant effect on earnings management in Sharia Commercial Banks in Indonesia.Keywords: corporate governance, financial performance and sharia banking.
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Ariyibi, Ebenezer Mayowa, Lateef Adewale Yunusa, and Tolulope Oyakhilome Williams. "Bank Specific Factors and Bank Performance: Evidence from Nigeria." Signifikan: Jurnal Ilmu Ekonomi 9, no. 2 (2020): 167–76. http://dx.doi.org/10.15408/sjie.v9i2.14658.
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The impact of bank-specific factors on the performance of the deposit money banks in a country has been an area of inquiry for any bank-based financial system. The research investigates the impacts of bank-specific factors on bank performance in Nigeria within 2014-2018. This research use panel data from ten banks that had the best deposit in 2018. The panel data approach found a significant negative relationship between asset quality and return on asset and a significant positive relationship between loan-to-deposit ratio, capital adequacy, and return on asset. In this regard, strategic management should ensure chasing their functional intermediation role and ensure liquidity preference to meet its day-to-day obligations.JEL Classification: G21, G32, C33 How to Cite:Ariyibi, E. M., Yunusa, L. A., & Williams, T. O. (2020). Bank Specific Factors and Bank Performance: Evidence from Nigeria. Signifikan: Jurnal Ilmu Ekonomi, 9(2), 167-176. https://doi.org/10.15408/sjie.v9i2.14658.
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Khalil, Rashid, and Muhammad Azhar Khalil. "Does Bank Size and Operational Efficiency Matters? An Impact of Financial Gearing and Asset Management on Islamic Bank's Performance in Pakistan." Journal of Accounting and Finance in Emerging Economies 3, no. 1 (2017): 63–78. http://dx.doi.org/10.26710/jafee.v3i1.160.
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Purpose: The persistent growth of Islamic banks has been the distinction of the Muslim world financial background in the 1980s and 1990s. Through a network that spans more than 62 countries and an asset base of more than $169 billion; Islamic banks are now performing a progressively more significant role in their particular economies. The core objective of this study is to find the impact of some of the key bank-specific factors (internal determinants) on the profitability of Islamic banks in Pakistan. Factors that opted in this study are bank size, operating efficiency, gearing ratio and asset management. Secondary data was obtained from 5 Islamic banks in Pakistan from year 2007 to 2015. The Ordinary Least Square (OLS) was used to analyze the empirical findings. The estimation results show that bank size significantly and positively influence the bank profitability while the asset management inversely affects the bank profitability. For future studies, it is recommended that more sample size and determinant factors can be included in determining the impact on bank's profitability.
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Liyanage, Neelwasantha Henegama, Indika Senadeera Kaluwa Dewa, and Fathan Ismail Mohamed Ismail. "Credit Risk Management and Bank Performance: With Special Reference to Specialized Banks in Sri Lanka." Asia-Pacific Journal of Management and Technology 02, no. 01 (2021): 01–10. http://dx.doi.org/10.46977/apjmt.2021v02i01.001.
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The adoption of credit risk management is becoming a crucial factor for every bank. The objective of this study identifies the relationship between the credit risk management determinants revealed by banking soundness index indicators CAMEL (Capital adequacy, Assets quality, Management efficiency, Earnings, Liquidity) on the performance of the License Specialize banks in Sri Lanka. This study is based on secondary data from each bank annual reports. The data were collected from six development bank among seven development banks in Sri Lanka. The sample was selected from the population based on the availability, convenience method, and reliability of data over the set period. The panel data of a sixteen-year period from 2000 to 2016 from the selected banks, were used to examine the relationship between credit risk management and performance. The Return on equity is used as a performance indicator and Capital adequacy and Asset quality were used as indicators of credit risk management. The study used multiple regression to analyze the data. With these findings, it revealed there is a strong impact of the CAMEL components on the financial performance of specialized banks in Sri Lanka. As per the findings of analysis Capital Adequacy, and Asset quality has a negative significant relationship between bank performances of ROE. This study also documented that there is a significant relationship between credit risk management by CAMEL Indicators and the financial performance of specialized banks in Sri Lanka. Therefore, this study suggests that the CAMEL model can be used as a proxy for credit risk management in the context of License Specialize banks Sri Lanka.
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Ahmed Mareai Senan, Nabil, Aida Abdulaziz Ali Noaman, Borhan Omar Ahmad Al-dalaien, and Eissa A. Al-Homaidi. "Corporate social responsibility disclosure and profitability: Evidence from Islamic banks working in Yemen." Banks and Bank Systems 16, no. 2 (2021): 91–102. http://dx.doi.org/10.21511/bbs.16(2).2021.09.
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This study aims to examine the influence of corporate social responsibility (CSR) disclosure determinants on profitability of Yemeni Islamic financial institutions. The empirical study was based on a balanced panel for twelve years from 2005 to 2016. Banks’ profitability is measured by four indicators such as return on assets (ROA), return on equity (ROE), profit after tax (PAT), and earnings per share (EPS), while corporate social responsibility, financial leverage, inflation rate, asset size, and age of Islamic banks are considered as independent variables. The results of this study with regard to ROA indicated that corporate social responsibility, asset size, inflation rate, and age of Islamic banks have a significant influence on profitability (ROA). With respect to ROE, the result indicated that financial leverage, asset size, and inflation rate are the most important variables affecting bank profitability (ROE). Concerning PAT, the outcome revealed that financial leverage and age of Islamic banks have a significant effect on profitability (PAT). Finally, the result with respect to EPS indicated that financial leverage, asset size, inflation rate, and age of Islamic banks have a significant impact on bank profitability (EPS). The result will be beneficial to scholars, investors, stakeholders, managers, and policymakers in the Islamic financial sector.
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Paetzmann, Karsten. "Bad assets options and bank resolution in Europe." Journal of Risk Finance 16, no. 5 (2015): 486–97. http://dx.doi.org/10.1108/jrf-06-2015-0058.
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Purpose – This paper analyzes the new EU Bank Recovery and Resolution Directive (BRRD) to determine the level of guidance on instruments to wind-down bad asset portfolios of asset management vehicles. In the absence of such detailed guidance stipulated by the BRRD, the aim is to provide certain practical guidance to future resolution planning and execution. Design/methodology/approach – This paper draws upon experience from portfolio reduction strategies applied at European bad banks in the aftermath of the 2008 financial crisis. For illustration purposes, the paper use case study data from a bad bank located in the eurozone. Findings – For the new European Commission, implementation and enforcement of the Banking Union within the eurozone is currently a key priority. Present efforts are mainly directed towards minimum technical standards. However, the fundamental question of how to orderly unwind a bad assets portfolio without the usage of public funds remains partly addressed only. While a uniform approach to any bad asset does not seem to be applicable, certain lessons learned from previous financial crises may contribute to a selection of reduction strategies. Research limitations/implications – This paper draws upon experience from portfolio reduction strategies applied at European bad banks in the aftermath of the 2008 financial crisis. It includes case study data from the wind-down of a eurozone bad bank detailing the asset reduction strategies achieved so far. Such per asset class wind-down patterns have not been published and commented on in academia so far.
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ARCHER, SIMON, and RIFAAT AHMED ABDEL KARIM. "ON CAPITAL STRUCTURE, RISK SHARING AND CAPITAL ADEQUACY IN ISLAMIC BANKS." International Journal of Theoretical and Applied Finance 09, no. 03 (2006): 269–80. http://dx.doi.org/10.1142/s0219024906003627.
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Islamic banks do not pay interest on customers' deposit accounts. Instead, customers' funds are placed in profit-sharing investment accounts (PSIA). Under this arrangement, the returns to the bank's customers are their pro-rata shares of the returns on the assets in which their funds are invested, and if these returns are negative so are the returns to the customers. The bank is entitled to a contractually agreed share of positive returns (profits) as remuneration for its work as asset manager; however, if the returns are zero or negative, the bank receives no remuneration but does not share in any loss. In the case of Unrestricted PSIA, the investment account holders' funds are invested (i.e., commingled) in the bank's asset pool together with the bank's shareholders' own funds and the funds of current account holders. In that case, the bank's own funds that are invested in the asset pool are treated the same as those of Unrestricted PSIA holders for profit and loss sharing purposes; however, the shareholders also receive as part of their profit the remuneration earned by the bank as asset manager (less certain expenses not chargeable to the PSIA holders). This remuneration (management fees) represents an important source of revenue and profits for Islamic banks. From a capital market perspective, this arrangement presents an apparent anomaly, as follows: shareholders and Unrestricted PSIA holders share the same asset risk on the commingled funds, but shareholders enjoy higher returns because of the management fees. On the other hand, competitive pressure may induce the bank to forgo some of its management fees in order to pay a competitive return to its PSIA holders. In this way, some of the PSIA holders' asset risk is absorbed by the shareholders. This phenomenon has been termed "displaced commercial risk" [2]. This paper analyzes this phenomenon. We argue that, in principle, displaced commercial risk is potentially an efficient and value-creating means of sharing risks between two classes of investor with different risk diversification capabilities and preferences: wealthy shareholders who are potentially well diversified, and less wealthy PSIA holders who are not. In practice, however, Islamic banks set up reserves with the intention of minimizing any need to forgo management fees.
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AlKhouri, Ritab, and Houda Arouri. "The effect of diversification on risk and return in banking sector." International Journal of Managerial Finance 15, no. 1 (2019): 100–128. http://dx.doi.org/10.1108/ijmf-01-2018-0024.
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PurposeThe 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.Design/methodology/approachThe 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.FindingsNon-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.Research limitations/implicationsThe 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.Practical implicationsResearch results provide important implications for regulators, bank managers and policy makers, as to the expected ways to support economic diversification through bank diversification strategies.Originality/valueUnlike 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.
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Andriyanto, Irsad, and Aprilia Inge Prastika. "PENGARUH RASIO KESEHATAN BANK TERHADAP VOLUME PEMBIAYAAN BANK UMUM SYARIAH DI INDONESIA." MALIA: Journal of Islamic Banking and Finance 2, no. 1 (2018): 1. http://dx.doi.org/10.21043/malia.v2i1.4812.
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This research aimed to analyze the effect of financial ratios on financing successfully channeled by Sharia Commercial Banks in Indonesia in 2015- 2018. The bank's ratio is measured through CAMELS ratios (Capital, Asset Quality, Management, Earning, Liquidity, Sensitivity to Market Risk) for each aspect. Capital aspects are measured using the Capital Adequacy Ratio (CAR), asset quality (Asset Quality) is measured using Non Performing Financing (NPF), profitability (Earning) is measured using Return on Assets (ROA) and Operational Expenses to Operating Revenues (BOPO ), and liquidity (Liquidity) is measured using Financing to Deposit Ratio (FDR). The samples are 13 Sharia Commercial Banks with the observation period from January 2015 till May 2018. The data obtained through Sharia Banking Statistics (SPS) are then processed by multiple linear regression analysis. The results showed that the NPF and BOPO had a negative effect on the financing volume of sharia commercial banks, while ROA had a positive effect. In other way, the CAR and FDR have no significant effect on the financing volume of sharia commercial bank. This is because the capital is used to cover troubled financing and to maintain public trust
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Mifanyira, Franciska, Indah Dwi M. J., and Mega Dwi A. "Bank Liability in Trustee Agreement in Insolvency Status." Kanun Jurnal Ilmu Hukum 21, no. 3 (2020): 487–512. http://dx.doi.org/10.24815/kanun.v21i3.13872.
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A trust agreement is a special agreement in banking gives the bank the right and authority to manage the customer's assets as stated to the agreement The assets of trust assets are the property of the customer, the management of the assets must be separately carried out to implement the Prudential Principle and Pacta Sunt Servanda in banking contract. This Legal Research use normative positivist with the using of Statute and Conseptual Approach along with three research sources. This Legal Research focus on the Legal Consequences in the Trustee Agreement and Liability of Bank in the case of Bank include the Settlor’s asset as the Insolvency Asset. The Research result are Bank only as a manager of Asset so every legal conduct must have approval of Settlor so If the asset is included the Insolvency Asset is a contract and law violation so it should be fixed by the contractual dispute settlement. Tanggung Jawab Bank dalam Trustee Agreement pada Keadaan Kepailitan Perjanjian kepercayaan adalah perjanjian khusus dibidang perbankan yang memberi-kan hak dan wewenang kepada bank untuk mengelola aset pelanggan sebagaimana dinyatakan dalam perjanjian. Aset kepercayaan adalah milik pelanggan, pengelolaan aset harus dilakukan secara terpisah untuk menerapkan Prinsip Kehati-hatian dan Pacta Sunt Servanda dalam kontrak perbankan. Penelitian Hukum ini menggunakan metode positivis normatif dengan menggunakan undang-undang dan pendekatan konseptual bersama dengan tiga sumber penelitian. Penelitian Hukum ini fokus pada konsekuensi hukum dalam perjanjian perwaliamanatan dan Pertang-gungjawaban Bank dalam kasus Bank termasuk aset Settlor sebagai Aset Kepailitan. Hasil Penelitian adalah bank hanya sebagai manajer Aset sehingga setiap tindakan hukum harus memiliki persetujuan Settlor sehingga jika aset dimasukkan Aset Aset Kepailitan adalah kontrak dan pelanggaran hukum sehingga harus diperbaiki dengan penyelesaian sengketa kontrak.
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Godyń, Izabela. "A Revised Approach to Flood Damage Estimation in Flood Risk Maps and Flood Risk Management Plans, Poland." Water 13, no. 19 (2021): 2713. http://dx.doi.org/10.3390/w13192713.
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This article describes the determination of asset values in residential and industrial areas in Poland that can be used in the preparation of flood hazard and risk maps (FRMs) and flood risk management plans (FRMPs). In the Floods Directive’s first cycle of implementation (2010–2015), German indicators of asset value were adapted to Polish conditions. This approach was used due to the lack of national statistics necessary to determine the value of property. In this study, the asset values in residential and industrial areas were prepared on the basis of the nationwide household wealth survey conducted in 2016 by the Narodowy Bank Polski (the central bank of Poland) and other data available from Statistics Poland. The proposed approach enables the determination of asset values based on real, validated data. The obtained indicators result in higher and more realistic values of the assets of households (buildings with contents) and the assets of companies (fixed assets and stocks) operating in both residential and industrial areas. The proposed approach, as an extension in relation to the first planning cycle, has been implemented in the second cycle of FRMP preparation in Poland.
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Dang, Van Dan, and Hoang Chung Nguyen. "Bank asset allocation and finance structure under uncertainty in Vietnam." Managerial Finance 48, no. 3 (2021): 500–520. http://dx.doi.org/10.1108/mf-09-2021-0408.
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PurposeThe paper investigates the link between uncertainty and banks' balance sheet reactions.Design/methodology/approachThe study employs bank-level data in Vietnam during 2007–2019 to measure micro uncertainty in banking through the dispersion of bank-level shocks. Empirical regressions are performed by the two-step system generalized method of moments (GMM) estimator and then verified using the least squares dummy variable corrected (LSDVC) technique.FindingsBanks tend to reduce risky loans, hoard more liquidity and decrease financial leverage in response to higher uncertainty. The relationship between uncertainty and banks' balance sheet reactions is more pronounced for banks that suffer more credit risk and overall risk, thus supporting the precautionary motive of banks. Additionally, uncertainty also leads to a decline in the Net Stable Funding Ratio (NSFR) under Basel III, implying that banks may fail to find a more stable source of funding and be more subject to maturity mismatch during periods of higher uncertainty.Originality/valueThe paper is the first to explore comprehensively the relationship between uncertainty and banks' balance sheet aspects as simultaneously estimated by bank loans, bank liquidity and bank leverage. While many other uncertainty measures display aggregate uncertainty sources, an important contribution in this study is to anatomize uncertainty originating exclusively from banking at a disaggregate level. Besides, shedding light on how uncertainty drives bank funding liquidity as captured by the NSFR under Basel III is entirely novel in the literature.
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Yusuf, Muhammad. "Penilaian Kinerja PT Bank X dalam Mengelola Asset dan Kewajiban Berdasarkan Analisis Resiko dan Analisis Return." Binus Business Review 1, no. 1 (2010): 74. http://dx.doi.org/10.21512/bbr.v1i1.1023.
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Performance financial evaluation became a primary indicator for management, especially a bank. This research evaluated asset and liability management of PT Bank X to describe its risk and return, by using financial ratios. The results found that performance ratios of PT Bank X decreasingly, where interest margin and net margin decreased to negative. This because of interest expenses and other operational expenses increased. Risk evaluation based on liquidity ratio were also decreasing in 2006 – 2007, because of the most assets of the bank became illiquid assest and default credits. On the other hand, this conditions became worse because of “Rush”, many of their customers took their money out from the bank on the same period. In 2008, bank has reduced their default credits succesively and made its liquiditiy better than previous year. Bad quality of credit management and control made the bank budgets their bad allowances for default credits higher and made bank’s capital risk higher too. Finally, all of bank’s capital was financed with their liabilities. The other hand, bank’s operating risk were recovered slowly, by organzation rationalization to reduce number of employees, as efficiency also. But this effort, indeed, made employee expenses increasing because management must pay golden-shake hand costs to employees.
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Rathnayake, Dilesha Nawadali, Yang Bai, Pierre Axel Louembé, and Li Qi. "Interest Rate Liberalization and Commercial Bank Performance: New Evidence From Chinese A-Share Banks." SAGE Open 12, no. 2 (2022): 215824402210966. http://dx.doi.org/10.1177/21582440221096648.
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Abundant literature infers the negative incidence of financial liberalization in the banking sector. As interest rate marketization is a reality in China, we empirically investigate the determinants of commercial banks’ financial performance using 10 listed Chinese commercial banks for 1999 to 2019. Our findings suggest that net interest margin (NIM), non-performing loans (NPL), and asset size (LnAsset) are the key drivers of profitability in Chinese banks. Interestingly, for the sample of city banks observed, we find that bank performance is strongly driven by sound management of the assets and the retail interest margins. On the opposite, the joint-stock banks’ strong diversification leads to lower reliance on net interest margins. Our results also suggest that joint-stock banks’ asset size puts strong pressure on their overall performance and exert a diminishing return effect as their assets’ critical size generates proportional administrative expenses that hinder profitability.
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Gaur, Dolly. "Total Quality Management and Assets Quality." International Journal of Business Analytics 8, no. 1 (2021): 38–57. http://dx.doi.org/10.4018/ijban.2021010103.
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The present study aims to examine the relationship between assets quality of banks as represented by non-performing assets (NPA) and management quality. The study has used Fama-MacBeth regression approach to measure management quality, which has been considered as the primary determinant of NPA. A sample comprising of 45 scheduled commercial banks in India has been studied for a time period of 15 years (2004-2019). The findings have revealed that better quality management leads to better asset quality. Banks with above average managerial ability can reduce NPA significantly. The bank managers should focus on their role in controlling problem loans of banks and should implement more efficient monitoring and supervision process for loan portfolios. The policy makers should pay attention towards the managerial ability of banks and stress on enhancing the quality of management. Also, investors may take note of the banks that are showing good management quality because such banks can be a profitable investment avenue.
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Ping, Kee Guek, and Suhal Kusairi. "Analysis of CAMEL Components and Commercial Bank Performance: Panel Data Analysis." Jurnal Organisasi dan Manajemen 16, no. 1 (2020): 1–10. http://dx.doi.org/10.33830/jom.v16i1.835.2020.
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The banking industry is an importance for the economic development because this industry circulates funds from the surplus to the deficits in the economy to keep it healthy, grow and sustained. Besides, the primary indicator of the soundness of the financial system is the performance of banking. Therefore, the objective of the study is to analyses the effectof Capital Adequacy, Asset Quality, Management Efficiency, Earning Quality, and Liquidity (CAMEL) towards bank performance. This study employed a static panel data model and utilised data of nine developed countries from the year 2013 until the year 2017. The findings showed that Capital Adequacy and Earning Quality had a positive impact on bank performance.Conversely, Asset Quality, Management Efficiency and Liquidity are a negative impact on bank performance. The reason is, holding the high liquidity asset will reduce income as liquid assets are associated with lower rates of return. It would expect that higher liquidity would negatively affect with bank performance. Therefore, we can conclude that banking should put attention on CAMEL components for evaluating bank performance.
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Jahera, John S. "Portfolio theory with application to bank asset management." Journal of Banking & Finance 9, no. 3 (1985): 469–72. http://dx.doi.org/10.1016/0378-4266(85)90054-8.
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Kajola, Sunday, Wasiu Sanyaolu, Abdul-Azeez Alao, and Ayorinde Babatolu. "Determinants of Liquidity Management: Evidence from Nigerian Banking Sector." Vestnik Volgogradskogo gosudarstvennogo universiteta. Ekonomika, no. 3 (November 2021): 96–111. http://dx.doi.org/10.15688/ek.jvolsu.2021.3.9.
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The study examined the determinants of liquidity management in twelve Nigerian banks during 2009–2018. Liquidity ratio (LQR) and deposit to asset ratio (DAR) were used as surrogates for liquidity management. As the potential liquidity management determinant indicators, five bank-specific variables (capital adequacy, size, asset quality, profitability and deposit growth) and three macroeconomic variables (GDP growth rate, inflation rate and interest rate) were used as proxies. Results from balanced fixed effects least square regression analytical technique show that size, profitability, GDP growth rate and inflation rate are important liquidity determinants in Nigerian banks. Specifically, bank size has a positive and significant influence on LQR, while GDP growth rate and inflation rate exhibit a negative and significant relationship with LQR. It further reveals a positive and significant relationship between profitability (ROA) and DAR. It is recommended that banks’ management should focus attention on both bank-specific (size and profitability) and macroeconomic (GDP growth and inflation rate) factors when deciding appropriate liquidity management strategy to be adopted. These four variables have the capacity to influence the profitability, sustainable growth and survival of banks operating in a volatile business environment such as Nigeria.
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Muhanji, Geoffrey Indeje, and Joseph Theuri. "Bank Regulation and Level of Non performing Loans in Commercial Banks in Nakuru County Kenya." International Journal of Current Aspects in Finance, Banking and Accounting 2, no. 2 (2020): 59–76. http://dx.doi.org/10.35942/ijcfa.v2i2.132.
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The study sought to determine the effect of bank regulation and level of nonperforming loans in commercial banks in Nakuru County Kenya. The specific objectives of the study were to explore the effect of capital adequacy on the level of nonperforming loans in commercial banks in Nakuru County Kenya, to find out the effect of asset quality on the level of nonperforming loans in commercial banks in Nakuru County Kenya, to evaluate the effect of liquidity management on the level of nonperforming loans in commercial banks in Nakuru County Kenya, to examine the effect of management efficiency on the level of nonperforming loans in commercial banks in Nakuru County Kenya and to determine the moderating effect of macroeconomic factors on the relationship between bank regulation and level of nonperforming loans. The literature review focused on portfolio theory of investment, capital asset pricing theory and the capital buffer theory of capital adequacy. The primary data was collected using structured questionnaires and secondary data was collected from the banking survey 2017 and central bank of Kenya annual supervisory reports. The study employed multiple linear regression analysis and the finding revealed that there exist a negative and statistically insignificant relationship between capital adequacy and non-performing loans. It was also observed that there exist a negative and statistically insignificant relationship between liquidity management and non-performing loans. On the other hand, there exist a positive and statistically significant relationship between asset quality and non-performing loans. Similarly, there exist a positive and statistically insignificant relationship between management efficiency and non-performing loans. Finally, the findings indicated that macroeconomic factors have moderating effect on the relationship between bank regulations and non-performing loans in commercial banks in Nakuru County. It was concluded that asset quality positively influences non-performing loans while management efficiency influence positively the non-performing loans. Similarly, liquidity management exerts a negative influence on non-performing loans. Finally, capital adequacy influence negatively on non-performing loans. The study recommends that Central Bank of Kenya should regularly access lending behavior to ensure compliance with banking regulations to avoid increasing incidences of non-performing loans. In addition, Central Bank of Kenya should closely monitor banks with deteriorating asset quality. Further, Central Bank of Kenya should strictly monitor the economic sector and ensure that banks provide adequate provisions for loans to mitigate risks of default. Furthermore, banks should maintain a good balance on deposits and lending out loans and adhere to regulators decisions about monetary policies. Finally, banks should increase the operational efficiency of operation weakness and improve corporate governance on the sanction of loans and Central Bank of Kenya should focus on managerial performance in order to detect banks with potential increases in non-performing loans.
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Bhattarai, Bishnu Prasad. "Determinants of Capital Adequacy Ratio Commercial Banks in Nepal." Asian Journal of Finance & Accounting 12, no. 1 (2020): 194. http://dx.doi.org/10.5296/ajfa.v12i1.17521.
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The study attempts to determining the capital adequacy ratio of commercial banks in Nepal. This study is based on the secondary balance panel data. The data were collected from the 11 commercial banks for the period of 2013/14 to 2017/18 leading to 55 observations. The convenience sampling technique has been used to selection of sample of the study. The study period has been made for fresh data in the analysis. The descriptive, correlational and casual comparative research design has been used for data analysis. The study assumes that the capital adequacy ratio of commercial banks depends on bank specific variable: credit risk, asset quality, management quality, return on assets, liquidity, size of bank and macroeconomics variables gross domestic products growth rate and consumer price index i.e. inflation rate. The three different model like Pooled OLS, Fixed Effects Model and Random Effects Model have been used for data analysis. The results of the study revealed that the liquidity has positive and statistically significant effects on capital adequacy ratio. Size of bank and inflation rate have negatively and statistically significant results. The others variables profitability, asset quality, credit risk, management quality and growth of gross domestic products does not effect to capital adequacy ratio. The study concluded that liquidity, size of bank and inflation have major determinants of capital adequacy ratio in Nepal.
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Gochoco-Bautista, Maria Socorro. "Global liquidity, global risk appetite, and the risk of credit and asset booms." Philippine Review of Economics 57, no. 2 (2021): 146–69. http://dx.doi.org/10.37907/8erp0202d.
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This study examines the channels through which net cross-border bank flows and VIX, working through the domestic banking system, could potentially lead to the creation or exacerbation of credit and asset booms that may threaten financial stability. It uses bank firm-level data for the Philippines over the period 1991-2018. Among the study’s significant findings are the following: bank lending to the real estate and housing sector is consistently and significantly affected by net cross-border bank flows (NCBF); non-core bank liabilities is an important variable as it consistently affects the amount of total loans and loans to the commercial and industrial sector as well as bank asset growth and bank leverage; net cross-border flows lower bank asset growth; and banks’ cost of loans tends to be reduced by NCBF and by a reduction in global risk appetite. The use of macroprudential measures-including monitoring bank non-core liabilities and lending to sectors such as real estate-as well as capital flow management measures is warranted in order to prevent bank credit and asset booms from being created or exacerbated, which may threaten growth and financial stability.
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Garg, Ankit. "A STUDY ON MANAGEMENT OF NON-PERFORMING ASSETS IN CONTEXT OF INDIAN BANKING SYSTEM." International Journal of Engineering Technologies and Management Research 3, no. 11 (2020): 15–25. http://dx.doi.org/10.29121/ijetmr.v3.i11.2016.68.
Full textAbstract:
Non-performing Asset is one of the prevalent problem of Indian Banking sector. For the past three decades, the banking system has several outstanding achievements to its credit. Many banks are facing the problem of NPAs which hampers the business of the banks. Nonperforming assets are a drain to the banks. Various research studies have been conducted to analyze the root causes of NPA. The following study tries to understand the concept of NPA, its causes and impact on profitability. The problem of NPA impacts profitability, Liquidity and results in credit loss. Unless and otherwise proper remedial measures are taken the quantum of non-performing assets cannot be reduced and the bank will incur losses to a great extent.
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Nugroho, Lucky, and Nurul Anisa. "PENGARUH MANAJEMEN BANK INDUK, KUALITAS ASET, DAN EFISIENSI TERHADAP STABILITAS BANK SYARIAH DI INDONESIA (PERIODE TAHUN 2013-2017)." Inovbiz: Jurnal Inovasi Bisnis 6, no. 2 (2018): 114. http://dx.doi.org/10.35314/inovbiz.v6i2.833.
Full textAbstract:
This study aims to determine the effect of parent bank management, asset quality, and efficiency on the stability of Islamic banks. The method used in this study is a quantitative method using multiple linear regression analysis and using spss 23. Statistical software The population in this study are Islamic commercial banks (BUS) that are registered with Bank Indonesia (BI) and the Financial Services Authority (OJK) from 2013 to 2017. Furthermore, Islamic commercial banks continuously and regularly present annual financial reports for the period 2013-2017 and are sampled in this study. The number of samples in this study was 9 Islamic banks with five years of observation as many as 45 samples. Based on the results of the study showed that the management of the parent bank proxied by the directors and commissioners had a significant effect on the stability of Islamic banks due to the many sharia bank directors and commissioners who came from the parent bank which conventional banks had more experience in managing banks. Whereas for asset quality and efficiency variables that are proxied by NPF ratio and BOPO ratio there is no significant effect.