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1
Goodhart, Charles A. E. "The free banking challenge to central banks." Critical Review 8, no. 3 (June 1994): 411–25. http://dx.doi.org/10.1080/08913819408443346.
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Gavin, Michael A. "Independent central banks and banking crisis liquidity." Review of International Organizations 15, no. 1 (September 4, 2018): 109–31. http://dx.doi.org/10.1007/s11558-018-9324-5.
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Levieuge, G., Y. Lucotte, and F. Pradines-Jobet. "Central banks’ preferences and banking sector vulnerability." Journal of Financial Stability 40 (February 2019): 110–31. http://dx.doi.org/10.1016/j.jfs.2017.10.008.
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Dzhagityan, E. "Foreign Banks in Countries of Central Asia." World Economy and International Relations, no. 12 (2013): 74–83. http://dx.doi.org/10.20542/0131-2227-2013-12-74-83.
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The article presents the first in the Russian-language literature systemic research of the activities of foreign based banks in the countries of the Central Asia. A consideration of exogenous and endogenous risks in the banking sector has shown that internationalization of banking regulation and supervision substantially influences the financial status of foreign banks irrespective to their size, country of origin and experience of working at local markets. The revealed risks are systemized according to economic and legal dimensions. This allows to determine the limits of foreign banks’ efficient functioning in the region under consideration.
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Szunke, Aleksandra. "A new paradigm of modern central banking." Journal of Governance and Regulation 2, no. 2 (2013): 75–78. http://dx.doi.org/10.22495/jgr_v2_i2_p6.
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The changes in the modern monetary policy, which took place at the beginning of the twenty-first century, in response to the global financial crisis led to the transformation of the place and the role of central banks. The strategic aim of the central monetary institutions has become preventing financial instability. So far, central banks have defined financial stability as a public good, which took care independently of other monetary purposes (Pyka, 2010). Unconventional monetary policy resulted in changes the global central banking. The aim of the study is to identify a new paradigm of the role and place of the central bank in the financial system and its new responsibilities, aimed at countering financial instability.
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Nisha, Nabila, Mehree Iqbal, and Afrin Rifat. "Green Banking Adoption." International Journal of Technology and Human Interaction 16, no. 2 (April 2020): 69–89. http://dx.doi.org/10.4018/ijthi.2020040106.
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Today, commercial banks of the most environmentally affected countries invest voluntarily in social and environmental activities that targets socially-responsive business in the form of green banking. However, state-owned banks often encounter challenges in doing so since they operate in centralized manner and often lack in resources, government support and client base compared to commercial banks. Moreover, green banking initiates major changes in working environment and alters the provision of banking services for bankers in developing countries like Bangladesh. Given such challenges, it is important to examine the attitude of bankers working in state-owned banks towards the adoption of green banking. Findings claim that central bank regulations, followed by facilitating conditions and environmental concerns, are some of the factors that influence bankers' overall perceptions. Results indicate that bankers are fairly pragmatic in developing general attitudes towards the use of green banking as part of their work activities in all state-owned banks.
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Dimov, S., and V. Smirnov. "Risk Management in Dual Banking Systems: Islamic Ethical and Conventional Banking." Review of Business and Economics Studies 7, no. 4 (February 10, 2020): 6–12. http://dx.doi.org/10.26794/2308-944x-2019-7-4-6-12.
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The author makes comments on the state of the problem in part of the English-speaking scientific thought. The authors present a comparative analysis of risk management conducted in countries where the dual banking system is practised — Islamic (ethical) banking and conventional (western) banking. The study showed that a risk profile of an Islamic bank is not significantly different from the one of the conventional banks in practices. In the beginning, they point out the central thesis and prospects for the development of conventional and Islamic banking. The central part of the comments begins with the historical aspect of the comparison. According to him, despite the differences, they are based on the priority of financial and human values. Further, the authors carefully discuss the risk profile of Islamic banks and the unique risks facing Islamic banks. It was confronted with conventional risk management of banks based on the Basel Committee on Banking Supervision (BCBS). Today, the regulation applies to credit risk, market risk, operational risk and liquidity risk (Basel II and Basel III). After all, the author reaches two essential conclusions for his research.
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Vunjak, Nenad, Miloš Dragosavac, Jelena Vitomir, and Petra Stojanović. "Central and South – Eastern Europe Banking Sectors in the Sustainable Development Function." ECONOMICS 8, no. 1 (June 1, 2020): 51–60. http://dx.doi.org/10.2478/eoik-2020-0009.
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AbstractChanges in banking sectors with the onset of the global financial crisis were related to: globalization, sector deregulation, technological change and financial innovation. Structural changes within banking services (at the end of the 20th century) relate to: the consolidation of banks, the merging of banking and non-banking financial institutions and their competition with one another. Significant place in the part of sustainable development belongs to bank performance, vision and mission of banks. The corporate vision of banks should be the “framework” for the future development of a bank. The corporate mission should be a “roadmap” to the realization of the bank’s vision and an expression of the business philosophy of the bank in question.It is of particular importance for the banking sectors of the CEE countries to define: the vision, the mission, the situational analysis and the planned long-term goals of the bank. With the advent of the global financial crisis, the financial activity of banks in the Central and Southeastern European region decreased, as the number of attractive fusion and acquisition banks in the region concerned was reduced.The aim of the research is to determine the importance of the vision, mission and clearly set goals in banks, where the analysis of banking sectors in 13 countries over a period of 11 years was carried out. The analysis of GDP and its growth in the period from 2008 to 2018 indicates a dynamic growth in the countries of Central Europe and some countries of Southeast Europe. The analysis of the assets of the banking sector and its share in GDP indicates the dominant participation of the countries of Central and Southeastern Europe that are members of the European Union relative to the candidate countries for EU member states. Analysis of the banking sector of the influx countries shows that more than 70% of the banking market in Southeast European countries is influenced by foreign highly developed banking groups. Sustainable development can only be achieved through the active joint action of the banking sectors of the Central and Southeast European countries.
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Broz, J. Lawrence. "The Origins of Central Banking: Solutions to the Free-Rider Problem." International Organization 52, no. 2 (1998): 231–68. http://dx.doi.org/10.1162/002081898753162811.
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This article explains (1) the origins of central banking and (2) variations in the spread and durability of central banks across nations. Early central banks helped bind governments to honor their debts and thereby furthered governments' capacities to efficiently finance military expenditures. The origins of central banking are problematic because government credit-worthiness and efficient wartime fiscal policy are public goods, subject to the free-rider problem. Applying a variant of the joint-products model, I argue that governments offered private benefits (monopoly privileges) to select creditors to induce participation in central banks. To explain cross-national differences, I argue that the level of domestic political decentralization negatively affected the incidence and durability of central banking. Countries with decentralized political systems faced regulatory competition from strong local authorities as licensers of banking monopolies, making it difficult to adopt or sustain central banking. Qualitative and statistical evidence from Europe and the United States to about 1850 support the arguments.
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Alaeddin, Omar, Ahmed Khattak, and Moutaz Abojeib. "EVALUATING STABILITY IN DUAL BANKING SYSTEM: COMPARISON BETWEEN CONVENTIONAL AND ISLAMIC BANKS IN MALAYSIA." Humanities & Social Sciences Reviews 7, no. 2 (August 20, 2019): 510–18. http://dx.doi.org/10.18510/hssr.2019.7260.
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Purpose of Study: This paper aims to explore whether Islamic banks are more stable when compared with conventional banks in a dual banking system.
Methodology: This research employs Pooled OLS methodology for 42 banks, including 27 conventional banks and 15 Islamic banks, for the period of 2005-2016.
Results: The study suggests that Islamic banks are less stable compared to conventional banks in overall banking sector. Furthermore, it is found that big Islamic banks are less stable than big conventional banks and small Islamic banks are less stable than small conventional banks. The results disapprove of the widespread belief that Islamic banks are more stable and more resilient to adverse shocks in the financial crisis. Moreover, while investigating the shift in overall level of banking stability with respect to financial crises, regardless of bank type and bank size, it is observed that the overall banking stability is enhanced after the financial crises. This is intriguing and a sigh of relief for policy makers and regulators in the country.
Implications/Applications: This research is of contribution to policy makers and central banks in the countries with highly dual banking environment and for the central banks striving to become International Islamic financial hub.
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van ’t Klooster, Jens. "Central Banking in Rawls’s Property-Owning Democracy." Political Theory 47, no. 5 (December 10, 2018): 674–98. http://dx.doi.org/10.1177/0090591718810377.
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The dramatic events of the crisis have reignited debates on the independence of central banks and the scope of their mandates. In this article, I contribute to the normative understanding of these developments by discussing John Rawls’s position in debates of the 1950s and 1960s on the independence of the US Federal Reserve. Rawls’s account of the central bank in his property-owning democracy, Democratic Central Banking (DCB), assigns authority over monetary policy directly to the government and prioritizes low unemployment over price stability. I contrast DCB with Central Bank Independence (CBI), which requires that the central bank is independent of the government and pursues low inflation. I evaluate DCB by asking whether justice as fairness requires democratic control of the central bank and argue that it does not. Instead, so I argue, the choice between DCB and CBI should be justified in terms of the difference principle. By reflecting on central banking in a property-owning democracy, I cast new light on the Rawlsian realistic utopia of a just capitalist society, while also investigating democratic objections to today’s independent central banks.
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Ostojic, Sinisa. "Models of restructuring banking systems in economies in transition." Privredna izgradnja 45, no. 3-4 (2002): 201–24. http://dx.doi.org/10.2298/priz0203201o.
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In view of the still underdeveloped capital market in Central and Eastern Europe, modernizing enterprises particularly depends on a functioning banking sector. Due to the interdependence enterprises and banks the insolvency of individual enterprises set off chain reactions which resulted in the collapse of banks and shook the banking systems in some countries. Commercial banks were particularly susceptible to these developments since the ratio between their own fluids and enough experience in reorganizing enterprises nor business perspectives for the enterprises depending on them. In the past years the individual states have made different degrees of progress in reorganizing their commercial banks. Two policy patterns become manifest: Estonia very consistently closed insolvent banks and opened markets for foreign banks and newly developing private banks. Thus the Estonia state considerably reduced its own share in the banks. Latvia also tried to increase its banks orientation towards profitability by opening the market and reducing state shares. The other countries, by contrast, primarily improved capital endowment of the existing banks. Between 1992 and 1995 Polish, Hungarian and Slovene governments realized extensive recapitalisation. While Poland increased the registered capital of important commercial banks, the Slovene and the Hungarian governments also bought nonperforming loans from the banks for state bonds. Hungary then increased the registered capital of the big state-owned banks. In 1994. and 1995. respectively partial recapitalisation took place in Bulgaria and the Czech Republic. Neither Latvia nor Bulgaria nor Lithuania have until now succeeded in stabilizing their banking systems. In the Czech Republic which similar to Estonia opened the market, leading to the emergence of about 60 banks, the central bank has hitherto intervened in 12 banks facing liquidity problems or insolvency. In the Slovak Republic a far-reaching consolidation of banks is also still due. The governments in Bulgaria and Lithuania presently intend to increase the banks capital by state bonds, while the Latvian central bank refrained from direct intervention after the collapse of Banks Baltija and only intensified control of the banks activities.
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Kunhibava, Sherin. "Islamic Banking in Malaysia†." International Journal of Legal Information 40, no. 1-2 (2012): 191–201. http://dx.doi.org/10.1017/s0731126500006478.
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AbstractIslamic banking is the conduct of banking according to Shariah or Islamic law. Statistically Islamic banking has had phenomenal growth, according to the Asian Banker Research Group, the world's 100 largest Islamic banks have set an annual asset growth rate of 26.7% and the global Islamic finance industry is experiencing an average growth of 15-20% annually1. Recently the Prime Minister of Malaysia commented that Malaysia has been maintaining its leadership in Islamic banking and finance for over three decades2. As an International leader in Islamic banking, it would be interesting to explore the development of Islamic banking in Malaysia. This will be the objective of this paper. This paper will focus on the historical development of Islamic banking in Malaysia, from the creation of the Haj Pilgrim's Fund Board in the 1960s to the current Islamic banking scene of 17 local Islamic banks and five International Islamic banks in operation. This paper will also explore the unique regulatory and governance framework of Islamic banking in Malaysia, by touching on the Islamic banking Act 1983, the Central Bank of Malaysia Act 2009, the Banking and Financial Institutions Act 1989 and the Shariah Governance Framework introduced in 2011 by the Central Bank of Malaysia. This paper will also briefly introduce how Islamic banking works.
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Goel, Priya, and Dr Devender Pathak. "Composition of Advances in the District Central Cooperative Banks in Punjab." INTERNATIONAL JOURNAL OF MANAGEMENT & INFORMATION TECHNOLOGY 3, no. 3 (May 31, 2013): 56–69. http://dx.doi.org/10.24297/ijmit.v3i3.1723.
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The Banking scene in India has undergone a tremendous change due to the Narsimham Committee recommendations since 1992 i.e. with the advent of the new economic policy. It emphasized shift from centralized planning to indicative planning. Thus the committee shifted its onus from ownership to efficiency and competitiveness while ensuring the integrity and operational autonomy of the banks. Financial sector reforms, based on Narsimham committee recommendations, aim at fostering financially strong banking cooperative in a competitive world. As a result of these financial sector developments, policy makers and social thinkers were apprehensive that cooperative banking sector will be facing the challenges of increasing competition, emerging opportunities and withdrawal of government support and may have to abandon its social objectives. But cooperative banking system has some inherent strength in the form of its reach, infrastructure and intimate relations with its customers which have strengthened these banks to make a vital contribution to nations development. Cooperative banking system has progressively matured and is preparing itself to successfully meet new challenges. This paper is focused on one of the main business areas of the District Central Cooperative Banks of Punjab i.e. composition of advances. In this paper, a brief outline has been given about the various loan schemes of the District Central Cooperative Banks and the total loans outstanding in different categories of loans advanced during the period of study i.e. from 2000 to 2010.
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Fan, Hong, and Hongjie Pan. "The Effect of Shadow Banking on the Systemic Risk in a Dynamic Complex Interbank Network System." Complexity 2020 (May 18, 2020): 1–10. http://dx.doi.org/10.1155/2020/3951892.
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After the financial crisis triggered by the subprime mortgage crisis in the United States in 2008, many scholars believed that the unstable transmission of shadow banking business in the banking system is the main factor causing financial turmoil. This paper proposes a dynamic complex interbank network system model with shadow banking in which the dynamic complex interbank network system differs from the traditional banking network and is formed by the interrelated business between shadow banks and commercial banks to explore the effect of shadow banking on the systemic risk. The results show that the existence of shadow banking will increase the systemic risk, accelerate the speed of bankruptcy of banks, reduce the survival ratio of banks, and increase the strength of central bank assistance. The smaller the number of shadow banks in the system, the higher the degree of credit connection among commercial banks and the smaller the systemic risk.
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Bezgacheva, O. L., and V. N. Samotuga. "Strategies of Russian Banks in the Context of Economic Sanctions and the Pandemic Shock." Economics and Management 27, no. 4 (June 5, 2021): 304–10. http://dx.doi.org/10.35854/1998-1627-2021-4-304-310.
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Aim. The presented study aims to examine measures taken by the Russian government, actions of the Central Bank of the Russian Federation (CBR, Bank of Russia), and strategies of banks in the context of continuing anti-Russian sanctions and the coronavirus pandemic while also assessing whether they are sufficient to strengthen the country’s banking system.Tasks. The authors determine what measures are taken by the Central Bank of the Russian Federation to maintain the financial stability of the banking sector and an acceptable equity capital adequacy ratio; analyze the strategies of banks and the way they are adjusted in the context of sanctions and the pandemic; show the role of subordinated bonds as a source of the banks’ own funds.Methods. This study uses general scientific methods of cognition to analyze the problems of the banking system as well as the policy of the Central Bank of the Russian Federation and the Russian government aimed at overcoming the recession and maintaining financial stability in the banking sector.Results. As a result of unconventional decisions taken by the Central Bank of the Russian Federation, the total assets of the banking sector exceeded the pre-crisis level by the beginning of this year. Optimistic forecasts indicate that banks are adapting to changing conditions, adjusting their strategies accordingly.Conclusions. The Russian banking system passed the endurance test during the pandemic, generally maintaining an acceptable capital adequacy ratio. Due to large-scale government support, the economic decline in Russia has slowed down, and there are signs of recovery growth. Banks entered 2021 with an obvious headstart. Almost all banks in the top 200 made a profit.
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Dudchenko, Victoria. "EVOLUTION OF CENTRAL BANKS." Economic Analysis, no. 30(1, Part 1) (2020): 84–89. http://dx.doi.org/10.35774/econa2020.01.01.084.
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Introduction. Throughout the centuries there took place a process of central banks’ development that reflected on the area of target defining, establishing the relationship with government, interconnection with financial market participants, inner management processes. This institute’s evolution from the first bank of issue creation till the modern central bank, including the supranational central bank in the European Union, is characterized by complicated tools of the change of policy, practice, institutional structure, aims and status. Nowadays the next stage of central banks’ development occurs and is characterized by expanding the mandate, reforming the policy, developing innovative aims. This stage is outlined with the global financial and economic crisis and the post-crisis period of the world financial system’s recovery. Under these circumstances, the central banks’ role tends to increase in terms of overcoming the consequences on the global financial and economic crisis that prompts actualizing the issues of integration of unconventional measures in the monetary policy tool, coordination of work of central bank and government concerning debt management, cooperation between the central bank and international financial institutions within the framework of debt management, cooperation between the central banks and international financial institutions within the framework of banking management. Purpose. Generalization of stages and systematization of the causes of emergence, formation and development of a central bank institution through the study of their creation’s evolution and functions’ transformation. Method (methodology). In order to investigate the historical processes, logical sequence of central banks’ development both historical and logical methods of scientific researches were applied. Results. The reasons of central banks’ emergence were generalized, the evolution of central banks’ creation was studied, stages of emergence and development of central banks were further developed and systematized. The peculiarities of the modern stage of central banks’ functioning, role’s change and transformation of functions under the influence of global financial and economic crises.
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Nyasha, Sheilla, and Nicholas M. Odhiambo. "Banking sector reforms in Kenya: Progress and challenges." Corporate Ownership and Control 10, no. 1 (2012): 88–96. http://dx.doi.org/10.22495/cocv10i1art8.
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This paper gives an overview of the banking sector in Kenya; it highlights the reforms since the country‟s independence in 1963; it tracks the growth of the banking sector in response to the reforms implemented over the past four decades; and finally, it highlights the challenges facing the banking sector in Kenya. The country‟s banking sector consists of more than 40 commercial banks, with the Central Bank of Kenya, which is the country‟s central bank, at the apex. Since the 1980s, the Kenyan government has implemented a number of banking sector reforms – in order to safeguard and improve the banking sector. The response to these reforms by the banking sector has been varied. As a result of these reforms, there has been a shift in the dominance from the State-owned banks to the private commercial banks. There has also been an improvement in the Central Bank‟s oversight of the financial institutions, and an enforcement of the banks‟ capital-adequacy requirements. By the standards of African countries, Kenya currently has one of the most developed banking systems in Africa. The country has enjoyed a substantial bank-based financial sector development over the years, and its institutional framework has also grown stronger. However, like many other developing countries‟ financial systems, the Kenyan banking system still faces wide-ranging challenges, such as high interest rate spreads and financial inclusion challenges
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Krukovets, Dmytro. "Data Science Opportunities at Central Banks: Overview." Visnyk of the National Bank of Ukraine, no. 249 (June 30, 2020): 13–24. http://dx.doi.org/10.26531/vnbu2020.249.02.
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This paper reviews the main streams of Data Science algorithm usage at central banks and shows their rising popularity over time. It contains an overview of use cases for macroeconomic and financial forecasting, text analysis (newspapers, social networks, and various types of reports), and other techniques based on or connected to large amounts of data. The author also pays attention to the recent achievements of the National Bank of Ukraine in this area. This study contributes to the building of the vector for research the role of Data Science for central banking.
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Marichal, Carlos. "Banking History and Archives in Latin America." Business History Review 82, no. 3 (2008): 585–602. http://dx.doi.org/10.1017/s0007680500082660.
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In recent years, business history has become a rich and varied terrain for research in Latin America. In this essay, I will present an overview of key aspects of banking history in the region, with an emphasis on the sources that are available in Argentina and Mexico. The extensive archives that have been built up in both countries offer historians the opportunity to study an array of topics: histories of individual banks; the evolution of banking systems; the relation between banking firms and industrial and agricultural development; the role of banks in government finance; the unique historical trajectories of central banks; the rise and relative decline of state-development banks; and the complex history of foreign banks in Latin America from the nineteenth century to the present.
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Audu, Nathan. "E-Banking and Monetary Policy in Nigeria." Athens Journal of Τechnology & Engineering 8, no. 3 (September 6, 2021): 237–58. http://dx.doi.org/10.30958/ajte.8-3-3.
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The goal of this paper is to assess the impact of e-banking, which are distinct from conventional banking systems, on central banks’ monetary policy. E-banking poses a challenge to central banks’ ability to control interest rates and it may also increase endogenous financial instability. The challenge to interest rate control stems from the possibility that e-banking may diminish the financial system’s demand for central bank liability, rendering central banks unable to conduct meaningful open market operations. Increased financial instability could emerge from the increased elasticity of private money production and from the periodic runs out of e-banking into central bank money that generates liquidity crises. Similarly, the future of e-banking is dependent on its growth, regulation and increased technological advancements that would boost the security of the new instrument. It will directly impact the central bank’s control of monetary policy unless it is included in its measurements of monetary aggregates. We therefore recommend that since the impact of e-banking on monetary policy depends solely on how fast it will spread and the extent to which it will substitute for cash, it is vital that Central Bank of Nigeria (CBN) considers taking steps to compensate the resulting decrease in its balance sheet. Also, CBN must have to impose special obligations with the money reserve on the e-banking issuer in case of any large increase in e-banking creativity that will affect the monetary policy at the end. The government must keep the rate of prices stable and with this condition, where e-banking will be equal to other forms of money which maintain by apportion percentage as a reserve ratio to the central bank. Similarly, if e-banking spreads moderately, there will be a decrease in the seigniorage income and thus, the decrease in the balance sheet of CBN will be limited. Hence, it must include e-banking in monetary aggregates that the spread of e-banking may lead to a change in the velocity of money. Keywords: monetary policy, e-banking, technology, velocity of money
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Mohamud, Hussein Hillowle, and Fredrick Warui. "Innovative Banking Practices and Financial Performance of Commercial Banks in Kenya." International Journal of Current Aspects in Finance, Banking and Accounting 3, no. 1 (August 13, 2021): 41–53. http://dx.doi.org/10.35942/ijcfa.v3i1.180.
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Commercial banks serve as key financial intermediaries in facilitation of the flow of money in the banking industry. Commercial banks offer credit to investment banks in order to offer investment opportunities for risky investments especially for financial securities using depositors’ money. Globally, banks are affected by broad difficulties in the operating environment. The banking industry has embraced innovation to sustain competitiveness. Financial innovations used by commercial banks revolve around the latest product, service and its conveyance to consumers. Consequently, this information influenced the research with its aim as; investigating innovative banking applications and monetary capability of banks. Particular goals included examining how; real time gross settlements (RTGS), electronic fund transfers (EFT), pay bill innovation in mobile banking and the extent of agency banking influence monetary potential of banks. Research anchored on the Schumpeter theory of innovations, the agency and bank-led theories. It was explanatory in nature and applied a census approach to gather information. The targeted group included commercial banks registered under the Central Bank totalling to 42 tiers 1. Raw and derived data was equally utilized including, financial statements and face to face interviews with top level managers. Collected information was examined by SPSS. Given conclusions were dispensed descriptively, and by inferring to statistical presentations. The resulting conclusion was that; when RTGS, agency banking, EFT, and mobile banking are solely brought up/down by a single unit, financial performance increased/ decreased by 0.163, 0.27, 0.197, and 0.318 units. At a constant however, financial performance remained at 0.236 out of 5 units. In conclusion, commercial in banks have significantly relied on innovative banking practices to shift their financial performance to new heights. The study has particularly placed both mobile and agency banking at a more central position in driving financial performance to the desired level than other factors including the RTGS and EFT. As part of the recommendations, managements of commercial banks should consider scaling up their adoption of RTGS, agency banking, EFT, and mobile banking as ways of reducing the operating cost of their respective banks reducing banking hall congestions since most of the frequently sought banking services can be achieved without one on one meeting with the bank tellers. Management should also consider adopting more innovative banking practices besides those this research investigated.
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Djalilov, Khurshid, and Jenifer Piesse. "The determinants of bank efficiency in Central Asia." Corporate Ownership and Control 12, no. 1 (2014): 656–70. http://dx.doi.org/10.22495/cocv12i1c7p5.
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This paper examines progress in the transition to a market economy of the banking sector of Central Asia (CA), a region that was late to take on reform and which has largely been ignored in the literature. A comparison to other previous Soviet Republics shows that the banks in the Baltic States have higher profit efficiency compared to those in CA. The results also suggest that state owned banks are less profit efficient than private banks although foreign ownership is not a factor in efficiency levels of banks in Central Asia
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Gallizo, José Luis, Jordi Moreno, and Manuel Salvador. "EUROPEAN BANKING INTEGRATION: IS FOREIGN OWNERSHIP AFFECTING BANKING EFFICIENCY?" Journal of Business Economics and Management 16, no. 2 (December 16, 2014): 340–68. http://dx.doi.org/10.3846/16111699.2013.769023.
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The aim of this study is to analyze how European integration and, especially, changes in ownership, has affected banking efficiency in Central and Eastern European countries which have recently experimented this process more intensely. Using a stochastic frontier approach, applied to panel data, we have estimated bank efficiency levels in a sample of 189 banks from 12 countries during the period 2000 to 2008 and we have analyzed the influence of some bank characteristics on these efficiency levels. The results show that European integration has significantly improved the cost efficiency of banks in these countries, but profit efficiency has significantly decreased. We have found very small differences between different ownership types and only a very small impact of foreign ownership on cost efficiency, showing that the entry of foreign ownership is not enough to explain the significant variations in banking efficiency after the accession.
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Nkhwangwa, Lordwell C. T. "Achieving Strategic Fit/Integration between Business Strategies and Human Resource Management (HRM) Strategies in the Banking Sector: An Assessment of the Commercial Banks in Malawi." International Journal of Social Sciences and Management 1, no. 4 (October 25, 2014): 143–59. http://dx.doi.org/10.3126/ijssm.v1i4.11022.
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As the business environment becomes volatile and competitive and as more bank services and financial institutions battle for recognition in the market, numerous strategies are needed by business firms for dealing with such fierce competition. For the banks to win the much anticipated competition, the business strategies they employ have to be strategically integrated with human resource management strategies. A strategic fit between business strategy and human resource management strategy helps in retaining and motivating employees translating into high organizational performance and competitive advantage for the firm. This paper studied how the commercial banks in Malawi are strategically achieving a fit between business strategies and H.R.M strategies. The findings of the study indicate a correlation and a strong fit between business strategies and HRM strategies in the commercial banks in Malawi. The fit is achieved through an integrated process where HRM strategy is an integral part of the business strategy, alongside other functional strategiesDOI: http://dx.doi.org/10.3126/ijssm.v1i4.11022 Int. J. Soc. Sci. Manage. Vol-1, issue-4: 143-159
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Judy, Haidar Hamza, and Fazila Boutoura . "Applications of Governance in Banks According to Basel (3) Committee Decisions." Iraqi Administrative Sciences Journal 1, no. 2 (June 30, 2017): 96–119. http://dx.doi.org/10.33013/iqasj.v1n2y2017.pp96-119.
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Increased attention banking governance after the repercussions of the financial and banking crashes of some of the poles of the American and European Banks, and the consequent of a global confidence's crisis in the financial statements of Banks and Companies because of the weakness accounting disclosure and transparency, and many countries rushed to adopt a banking governance. In Algeria, continued in recent years, the works aimed at establishing an integrated framework for banking governance at the level of financial and banking institutions.Basel III is a new gateway to strengtheningbankinggovernance and enabling the central bank to apply the necessaryfoundations for governance in banks, particularlythrough the Pillars of market discipline.
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Woodruff, David M. "To Democratize Finance, Democratize Central Banking." Politics & Society 47, no. 4 (November 11, 2019): 593–610. http://dx.doi.org/10.1177/0032329219879275.
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Robert C. Hockett’s “franchise view” argues, convincingly, that the capacity of banks or quasi-bank financial entities to create money rests on the laws, regulations, and guarantees of the state under which they operate. Fred Block advocates the use of this insight as a beachhead for establishing the legitimacy of locally embedded, nonprofit lenders whose investments would be dedicated to public purposes. However, given the pervasive influence of “everyday libertarianism,” which fosters blindness to the public character of private economic power, this commentary warns of possible counterproductive consequences of this proposal unless it is fused to the democratization of central banking. An end to central bank independence would highlight the ineliminable role of the state in the market and make that role easier to reshape. It would also end the dynamic whereby monetary easing provides political cover for damaging fiscal austerity and thus lead to better democratic deliberation on the contours of policy.
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GROSSMAN, RICHARD S. "Charters, corporations and codes: entry restriction in modern banking law." Financial History Review 8, no. 2 (October 2001): 107–21. http://dx.doi.org/10.1017/s096856500100021x.
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This paper examines the evolution of the legal foundation under which commercial banks operated in different countries. The earliest incorporated banks were established under charters issued by sovereigns or legislatures. Subsequently, charters were issued: (1) though corporation law; or (2) via special banking codes. Countries that concentrated their note issues in central banks earlier were less in need of detailed banking codes and were, therefore, more likely to have allowed banks to operate under general corporation laws. By contrast, countries in which note issue was not centralised were more likely to have established a detailed banking code.
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H. Omar, Habiba, and Mohd E. Yusoff. "Central bank impact on practicing Mudarabah financing in Islamic banks: the case of Tanzania." Banks and Bank Systems 14, no. 1 (February 25, 2019): 81–93. http://dx.doi.org/10.21511/bbs.14(1).2019.08.
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This paper investigates the challenges faced by Islamic banks in practicing Mudarabah financing under conventional regulatory regime by interviewing eleven Islamic bank managers from three selected banks. Thematic data analysis was employed to understand hindrances for Islamic banks in operating Mudarabah financing under conventional regulatory regime. Findings of the study have provided a number of major challenges that hinder Islamic banks performance in Tanzanian context. The challenges include irregularities of policies and regulations, non-supportive operational and technical structure, and missed perceptions of Mudarabah among the public. However, a new challenge of the impact of the central bank on Islamic banks was identified. It is expected that Tanzanian Islamic banking performance will enhance if the central bank introduces sharia regulations for Islamic banking, initiates the central sharia supervisory board, and harmonize country regulations with financial regulations regarding Islamic perspectives.
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Dwumfour, Richard Adjei. "Explaining banking spread." Journal of Financial Economic Policy 11, no. 1 (April 1, 2019): 139–56. http://dx.doi.org/10.1108/jfep-02-2018-0031.
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PurposeThe paper aims to explain bank interest spread from 2000 to 2014.Design/methodology/approachThe study used the ordinary least square panel corrected standard errors (OLS-PCSE) estimation. Generalised least squares results (unreported but available on request) are consistent with the OLS-PCSE results. This is done for 110 developing countries, 50 Europe & Central Asia countries, 33 Latin American countries, 21 Middle East and North African (MENA) countries, 46 Sub-Saharan African (SSA) counties and 8 South Asia countries. The developing countries are further grouped into small, medium and large-size banking markets.FindingsThe study finds consistent results which indicate that the bigger a bank the less margin charged. The results further show an ambiguous relationship between concentration and net interest margin. The authors find strong evidence to show that less competition leads to inefficient banking market. The study finds lower operational efficiency can lead to higher or lower margin depending on the region or market size. General growth in the economy can lead to a more efficient banking market. The results allude to the fact that inflationary shocks do pass on to deposit and loan rates at different extent and speed. Little evidence show that higher presence of foreign banks leads to higher margins.Practical implicationsThe study recommends Central banks to encourage banks to grow/expand either through mergers or acquisitions. This could be done by increasing minimum capital requirements. When this is done, it is most likely that economies of scale among the merged banking entities will be materialised, potentially causing a sizable reduction in overhead costs that could eventually also increase the intermediation efficiency. While at this, further efficiency should be ensured through stirring up competition.Originality/valueThis study is the first to give new evidence of banking spread using country level data for developing countries and across different continents.
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Shubbar, Haider H. Dipheal. "Methodological Aspects of the Financial Stability of Iraq’s Banking System." Vestnik Tomskogo gosudarstvennogo universiteta. Ekonomika, no. 51 (2020): 208–18. http://dx.doi.org/10.17223/19988648/51/13.
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This article discusses the methodology the Central Bank of Iraq developed to assess the financial stability of commercial banks. This topic is relevant because, in modern economic conditions, the Central Bank of Iraq is forced to tighten requirements to credit institutions. Banks use not only their own funds, but also the funds of the population, legal entities, so they must be reliable and stable. Financial stability directly characterises the reliability of banks, so it must be strictly controlled. The Central Bank of Iraq has created its own methodology for assessing the financial stability of the banking sector. Its use should improve the quality of the created banking system development strategies and the financial monitoring of these strategies’ implementation. The Iraqi banking sector has a high level of capital adequacy, which helps to reduce the likelihood of financial distress in it.
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Kozak, Sylwester, and Agata Wierzbowska. "Banking Market Concentration and Bank Efficiency. Evidence from Southern, Eastern and Central Europe." South East European Journal of Economics and Business 16, no. 1 (June 1, 2021): 38–52. http://dx.doi.org/10.2478/jeb-2021-0004.
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Abstract The importance of the question about the relationship between concentration and efficiency lies in the fact that banks’ efficiency affects ability to extend loans and ensure financial stability of the banking sector. The study examines this relationship on the example of 150 banks operating between 2005 and 2019 in 11 EU and 8 non-EU countries from the SECE region. The value of profit efficiency was assessed with the stochastic frontier approach, and next regressed with the banking market concentration and bank specific and macroeconomic explanatory variables. The results for the entire sample as well as for domestic and foreign-owned banks indicate that concentration positively and nonlinearly impacts bank efficiency, both in EU and non-EU countries. Moreover, the size of a bank and income diversification help to improve efficiency of banks in the SECE region. The study shows that banks in SECE countries seem to follow the efficient structure hypothesis.
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Șimandan, Radu, and Cristian Păun. "The Costs and Trade-Offs of Green Central Banking: A Framework for Analysis." Energies 14, no. 16 (August 21, 2021): 5168. http://dx.doi.org/10.3390/en14165168.
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The participation of central banks in the fight against climate change has recently been advanced in several academic articles and policy papers. Since the emerging consensus is that climate change poses financial risks, the envisaged green central banking has a responsibility to address environmental sustainability as a means of promoting financial stability—an increasingly accepted goal of central banks in the post-financial crisis world. Thus far, the pro side of the argument is well represented in the literature, though often the benefits remain implicit: with the help of central banks via monetary and macroprudential policies, a smooth transition to a low-carbon economy would be somehow beneficial to all of us. With this article, we aim to add to this literature by looking at the costs and trade-offs of this course of action in light of the observation that the con side of the proposal has been only marginally addressed. We put forward a framework for the analysis of the costs and trade-offs of green central banking and exemplify the applicability of this framework by studying three cases of central banks for which the transition to green operation has been advanced. We find evidence that if costs and trade-offs are taken into account, the case in favor of greening central banks becomes less straightforward than is currently conveyed in the literature.
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Burlachkov, V. "Money Supply: Theory and Organization." Voprosy Ekonomiki, no. 3 (March 20, 2005): 48–60. http://dx.doi.org/10.32609/0042-8736-2005-3-48-60.
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The effect of money multiplier is determined by credit activities of the banking system and depends upon the value of the difference between average profitability in the economy and interest rate. The modification of payment systems may lead to decreasing central banks possibilities of money regulation. Seigniorage which is obtained by the banking system is a kind of economic rent. The effect of money multiplier reveals itself in the world credit market and influences exchange rate dynamics of reserve currencies. Using government securities as the main asset of central banks and as an instrument of open market operations leads to appreciation of interest rate and to decreasing of credit activities in the economy. A perspective instrument of money regulation is allocation of central banks deposits with commercial banks.
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Dzombo, Gift Kimonge, James M. Kilika, and James Maingi. "The Mediating Effect of Financial Inclusion on the Relationship between Branchless Banking Strategy and Performance of Commercial Banks in an Emerging market Context: The Case of Kenya." International Journal of Economics and Finance 10, no. 7 (June 25, 2018): 161. http://dx.doi.org/10.5539/ijef.v10n7p161.
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Since 1990 to date, a lot of banking innovation has taken place in order to improve commercial banks financial performance. Branchless banking which involves the use of agency banking and electronic banking channels in the distribution of banking products and services is one such innovation. This study investigated the role of financial inclusion on the relationship between branchless banking strategy and financial performance of commercial banks in Kenya. The specific objectives of the study were to analyze the effect of agency banking and electronic banking channels on the financial performance of commercial banks in Kenya. The study also aimed at determining the mediating effect of financial inclusion on the relationship between branchless banking and financial performance of commercial banks in Kenya. The study adopted a correlational research design. A survey of all the 42 licensed commercial banks in Kenya was done. Both primary and secondary data on branchless banking and financial performance of banks was obtained from the commercial banks and Central Bank of Kenya banking annual supervision reports respectively. Return on Assets (ROA) was used as the main indicator of commercial banks financial performance. The amount of investment in agency and electronic banking was used as indicators for agency and electronic banking. Data analysis was done using SPSS and STATA statistical software. Study findings indicated that when used in isolation; both agency and electronic banking had a significant negative effect on the financial performance of commercial banks. However when agency and electronic banking channels were used together as a multichannel strategy, the effect on bank’s financial performance was found to be positive and significant at the 95 percent significance level. Study findings also indicate that the strength of the relationship between branchless banking strategy and financial performance of commercial banks in Kenya depends on the level of financial inclusion. The study recommends that for positive returns, commercial banks should invest in both agency and electronic banking as a multichannel strategy since these channels are complimentary to each other and calls on the government to come up with policies to foster financial inclusion within the banking industry in order for the industry to achieve maximum returns from branchless banking strategies.
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James, John A., and David F. Weiman. "The National Banking Acts and the Transformation of New York City Banking During the Civil War Era." Journal of Economic History 71, no. 2 (June 6, 2011): 338–62. http://dx.doi.org/10.1017/s0022050711001550.
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Focusing on the New York banking sector, we analyze a neglected, but profound impact of the National Banking Acts. By resisting federal banking legislation and “boycotting” newly chartered national banks, the New York Clearing House Association members created market opportunities for the new entrants to dominate the correspondent banking market. The new entrants’ aggressive tactics including interest payments on deposits increased their vulnerability to panicky withdrawals by country banks. They also magnified conflicts of interest within the clearinghouse, which weakened its central banking functions and further destabilized the macroeconomy.
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Carvalho, Carlos Eduardo, Desirée Almeida Pires, Marcel Artioli, and Giuliano Contento de Oliveira. "Cryptocurrencies: technology, initiatives of banks and central banks, and regulatory challenges." Economia e Sociedade 30, no. 2 (July 2021): 467–96. http://dx.doi.org/10.1590/1982-3533.2021v30n2art08.
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Abstract This paper analyses the impacts of the innovation known as distributed ledger technology (DLT) on the monetary system and on financial activities. Private cryptocurrencies, such as Bitcoin, are permissionless means of payment, based on blockchain, a form of DLT. Evaluations suggested that these private cryptocurrencies could compete with the banks payment systems and even supplant state currency. The development of these technologies has the potential to modify profoundly monetary and financial practices, but there are no indications that they may threaten the centrality of state money and the banking system in the contemporary monetary order. Major international banks have developed cryptocurrencies for settlement systems and for interbank transactions, including the so-called stablecoins, issued by highly technological companies with on par conversion into state money. Some central banks are studying the launch of state cryptocurrencies that could coexist with their fiduciary state currency and even replace their paper currency. The use of this technology results in new challenges for regulation, including the fact that cryptocurrencies can be used for money laundering and by organized crime.
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Acharya, Sankarshan. "Public lending to private hedge funds is inefficient, unstable, unconstitutional and unanimously disagreeable." Journal of Governance and Regulation 5, no. 2 (2016): 40–49. http://dx.doi.org/10.22495/jgr_v5_i2_p5.
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Public funds include federally insured deposits held under the custody of private banks, central bank loans and taxpayer funds. The principal finding of this paper is that lending such public funds through a private banking system to private hedge funds allied with the banks is inefficient, unstable, fundamentally unfair (unconstitutional) and unanimously disagreeable. This finding is akin to the unanimously agreeable safe central banking policy (Acharya, 1991-2016) which, in dynamic general equilibrium, (a) eliminates federal guarantee of bank deposits, (b) offers every business enterprise and household an option to keep in the central bank any part of its deposits it wants to be held absolutely safely, (c) completely deregulates all private banks without any privilege to rob public or private wealth like too-big-to-fail or too-big-to-be-jailed status or the power of market making and clearing. Safe central banking is the only way to make private banks responsible to hold sufficient capital to attract uninsured private deposits like the trading houses currently do. The private banks will then have complete freedom to lend their uninsured deposits to private hedge funds. The Volker Rule (NYT, January 30, 2010), incorporated in the Dodd-Frank Act of 2010, is an infeasible and unworkable band-aid for the moral-hazard driven systemic robbery of wealth creators wrought by the government-ordained private banking custody of public funds. The established systemic moral-hazard problem can be efficiently and constitutionally resolved only through unanimously agreeable safe central banking. Current proposals on overhauling of Fannie and Freddie made by various pundits of systemic robbery amount to a gargantuan amount of public lending to private hedge funds and, hence, inefficient, unstable, unconstitutional and unanimously disagreeable.
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Kuznyetsova, Anzhela, and Nataliya Pogorelenko. "Assessment of the banking system financial stability based on the differential approach." Banks and Bank Systems 13, no. 3 (October 2, 2018): 120–33. http://dx.doi.org/10.21511/bbs.13(3).2018.12.
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In this paper, the banking system financial stability is assessed based on the differential approach. The differential approach provides for taking into account the specificity of the banking system structural organization (from the standpoint of the central bank and the second-level banks) and the sets of financial stability indicators, different in terms of their structure, and their volatility measures, according to this approach.The banking system financial stability is assessed based on the two groups of indicators: the first one characterizes the central bank financial stability (indicators of gross international reserves, effectiveness of monetary policy and foreign exchange regulation, ability to create favorable conditions in order to ensure the effectiveness of the banking sector); the second one defines the financial stability level for state banks, banks with private and foreign capital (indicators of the capital adequacy, liquidity, structure of assets and liabilities, effectiveness of the activity, financial risks). The differences between the sets of financial stability indicators for different groups of banks and the expediency of taking them into account during the assessment are revealed and substantiated according to the results of using the principal components method.The developed procedure of assessing the banking system financial stability provides for: constructing the banking system financial stability index (by multiplicative convolution of central bank financial stability subindex and three banks’ financial stability subindices); defining its high, medium and low level according to its quantitative values (according to interval scales, developed according to the rule “3σ”; interpreting the assessment results based on the scenario analysis, which is based on taking into account the dynamic change of the financial stability index during the analyzed period and allows to identify the state of the banking system (stable, conventionally stable or critical).
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Nyasha, Sheilla, and Nicholas M. Odhiambo. "The australian banking sector reforms: Progress and challenges." Corporate Ownership and Control 10, no. 4 (2013): 469–78. http://dx.doi.org/10.22495/cocv10i4c5art4.
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This paper gives an overview of the Australian banking sector; it highlights the reforms since the 1970s; it tracks the growth of the banking sector in response to the reforms implemented over the past five decades; and finally, it highlights the challenges facing the Australian banking sector. The country’s banking sector consists of more than 60 commercial banks, with the Reserve Bank of Australia, the country’s central bank, at the apex. Since the 1980s, the Australian government has implemented a number of banking sector reforms in order to safeguard and improve the banking sector. The response to these reforms by the banking sector has been varied. As a result of these reforms, there has been an increase in the number of banks and a decrease in the number of building societies and credit unions. There has also been an improvement in the central bank’s oversight of the financial institutions, and an enforcement of the banks’ capital-adequacy requirements. Currently, Australia has one of the most developed banking systems in the world. The country has enjoyed a substantial bank-based financial sector development over the years, and its institutional framework has also grown stronger. However, like any other country’s financial system, the Australian banking system still faces wide-ranging challenges, such as bank concentration and exposure.
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Rutkauskas, Aleksandras Vytautas, and Gitana Dudzevičiūte. "FOREIGN CAPITAL AND CREDIT MARKET DEVELOPMENT: THE CASE OF LITHUANIA." Journal of Business Economics and Management 6, no. 4 (December 31, 2005): 219–24. http://dx.doi.org/10.3846/16111699.2005.9636111.
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There have been wide-ranging discussions on whether the investments of foreign banks into the banking sector of the Central and Eastern Europe countries (CEE) lead to greater competition and increase of the loan portfolio of the banks. Several empirical works have shown that a high proportion of foreign capital in the banking sector of CEE countries has generally positive effects on the quality and amount of loan portfolio of the banking sector, but there may also be some adverse effects. Lithuania has an open economy and the credit market is open to international banking competition. The loan portfolio of the banks in Lithuania was growing very rapidly during the last year. A drop in the loan interest rates was significant and banks offered credits under favourable conditions. At the same time, the Lithuanian banking sector is largely foreign‐owned. Foreign investors currently own approx. 87 % of the share capital of banks in Lithuania. The aim of this paper is to investigate the link between the Lithuanian credit market development and the entry of foreign banks
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Szunke, Aleksandra. "Changes in monetary policy after the crisis - towards preventing banking sector instability." Corporate Ownership and Control 11, no. 3 (2014): 470–76. http://dx.doi.org/10.22495/cocv11i3conf2p8.
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The instability of the banking sector has become the subject of wider scientific research during the global financial crisis. The financial crisis of the first decade of the twenty-first century began in the U.S. subprime mortgage market and quickly spread to the whole banking sector in the United States as well as in many countries of the global economy. Among five major American investment banks - Lehman Brothers went bankrupt, Bear Stearns and Merrill Lynch were taken over by other banks, and Goldman Sachs and Morgan Stanley were transformed into commercial banks, which were covered by the supervision and regulations of the central bank - the Federal Reserve System. The consequences of the global financial crisis also affected British banks, including The Royal Bank of Scotland, Lloyds Bank, Halifax, Abbey Bank, Barclays Bank and NBC Bank. In Iceland, during the global financial crisis which affected the Icelandic banking sector, three largest banks: Glitnir Bank, Landsbanki and Kauphting were nationalized, which means that the control was taken over by their government. It has caused, that reflections and scientific research on financial stability were replaced by the study of instability in particular in relation to the banking sector. The main aim of the study is to identify the general framework of the response system of central banks on the phenomenon of banking sector instability, in the context of preventing it in a long term. Current - the traditional system proved to be ineffective, because it did not prevent the spread of the factors that led to the destabilization of the banking market
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Zarutska, О., and R. Pavlov. "TRANSPARENCY OF BANKING SUPERVISION AS A NECESSARY CONDITION FOR THE INDEPENDENCE OF THE NATIONAL BANK OF UKRAINE." Vìsnik Sumsʹkogo deržavnogo unìversitetu, no. 3 (2020): 54–62. http://dx.doi.org/10.21272/1817-9215.2020.3-6.
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The article describes modern approaches to banking supervision, focused on the study of business models of banks and their risk profile. Approaches to determining the regime of supervision and measures to influence banks should take into account the specifics of their financial condition and the city in the market of banking services. Supervision tools should be objective and transparent. The introduction of innovative methods for determining business models and adequate supervisory actions is especially relevant in the period of instability of the banking system of Ukraine. Over the past ten years, the number of banks has declined significantly. The reason for the bankruptcy of most banks were realized credit, currency and liquidity risks. The recent crisis has significantly increased the requirements for methods of assessing the financial stability of the banking system. The National Bank of Ukraine is constantly improving the procedures for assessing the quality of active banking operations, regulatory capital adequacy, fixed capital adequacy and determining the required level of capital adequacy ratios in order to promote financial stability. At the same time, the definition of a business model remains subjective. The analysis of banks' business models should take into account the detailed characteristics of their assets, liabilities, income and expenses. The article proposes the method of structural and functional groups of banks on the basis of self-organizing maps Kohonen. The methodology is quite transparent and effective. Groups of banks with the same business models are combined around the extreme values of financial indicators, in the relevant areas of increased risk. This article justifies the need for a broad coverage of indicators that characterize banking risks. The formation of business models of banks should be determined by the characteristics of the banking system in a particular period. Characteristics of the structure of assets, liabilities, income, expenses and other financial indicators of banks reflect the peculiarities of the banking system and specific banks. The methods of neural networks - Kohonen's self-organizing maps - are adapted for processing large data sets. The study recommends that central banks use clear technology for the formation and analysis of business models. Subjective approaches to assessing financial stability and the choice of banking supervision regime violate the principle of central bank independence, as they involve a variety of non-economic factors.
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Andolfatto, David, Aleksander Berentsen, and Fernando M. Martin. "Money, Banking, and Financial Markets." Review of Economic Studies 87, no. 5 (October 14, 2019): 2049–86. http://dx.doi.org/10.1093/restud/rdz051.
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Abstract The fact that money, banking, and financial markets interact in important ways seems self-evident. The theoretical nature of this interaction, however, has not been fully explored. To this end, we integrate the Diamond (1997, Journal of Political Economy105, 928–956) model of banking and financial markets with the Lagos and Wright (2005, Journal of Political Economy113, 463–484) dynamic model of monetary exchange—a union that bears a framework in which fractional reserve banks emerge in equilibrium, where bank assets are funded with liabilities made demandable in government money, where the terms of bank deposit contracts are affected by the liquidity insurance available in financial markets, where banks are subject to runs, and where a central bank has a meaningful role to play, both in terms of inflation policy and as a lender of last resort. Among other things, the model provides a rationale for nominal deposit contracts combined with a central bank lender-of-last-resort facility to promote efficient liquidity insurance and a panic-free banking system.
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Dzombo, Gift Kimonge, James M. Kilika, and James Maingi. "The Effect of Branchless Banking Strategy on the Financial Performance of Commercial Banks in Kenya." International Journal of Financial Research 8, no. 4 (September 14, 2017): 167. http://dx.doi.org/10.5430/ijfr.v8n4p167.
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The Banking sector acts as the life blood of modern trade and economic development. Commercial banks influence, facilitate and integrate the economic activities like resources mobilization, poverty elimination, production, and distribution of public finance. The financial performance of commercial banks has great implications in the financial sector and in the country at large, and will still remain an important subject of concern by all the stakeholders in the banking industry. In the last two decades, a lot of banking innovation has taken place in order to improve commercial banks financial performance. Branchless banking which involves the use of agency banking and electronic banking channels in the distribution of banking products and services is one such innovation. This study purpose was to evaluate the effect of branchless banking on the financial performance of commercial banks in Kenya. The specific objectives of the study were to analyze the individual effects of agency banking and electronic banking channels on the financial performance of commercial banks in Kenya and the combined effect of both agency and electronic banking on the financial performance of commercial banks in Kenya. The study adopted an exploratory research design. A survey of all the 42 licensed commercial banks in Kenya was done. Both primary and secondary data on branchless banking and financial performance of banks was obtained from the individual commercial banks, Central Bank of Kenya banking annual supervision reports respectively. Return on Assets (ROA) was used as the main indicator of commercial banks financial performance. The amount of investment in agency and electronic banking was used as indicator for agency and electronic banking. Data analysis was done using SPSS and STATA statistical softwares. Descriptive statistics, diagnostic tests and tests of hypothesis were done. Data was presented using tables and charts. Study findings indicated that when used in isolation; both agency and electronic banking had a significant negative effect on the financial performance of commercial banks at 5 percent significance level. However, when agency and electronic banking channels were used together as a multichannel strategy, they had a significant positive effect on bank’s financial performance at 5 percent significance level. The study recommends that for positive returns, commercial banks should invest in both agency and electronic banking as a multichannel strategy since these channels are complimentary to each other.
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BORTNIKOV, Gennadiy. "Central banks and banking community responsive measures to the coronavirus epidemic." Fìnansi Ukraïni 2020, no. 3 (April 24, 2020): 65–79. http://dx.doi.org/10.33763/finukr2020.03.065.
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Maxwell, Charles E., and Lawrence J. Gitman. "Risk Transmission in International Banking: An Analysis of 48 Central Banks." Journal of International Business Studies 20, no. 2 (June 1989): 268–79. http://dx.doi.org/10.1057/palgrave.jibs.8490363.
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Schwarz, Claudia, Polychronis Karakitsos, Niall Merriman, and Werner Studener. "Why Accounting Matters: A Central Bank Perspective." Accounting, Economics and Law - A Convivium 5, no. 1 (January 1, 2015): 1–42. http://dx.doi.org/10.1515/ael-2014-0023.
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AbstractThis paper analyses how accounting frameworks can affect three important areas of responsibility of many central banks, namely monetary policy, financial stability and banking supervision. The identified effects of accounting rules and accounting information on the activities of a central bank are manifold. First, the effectiveness of monetary policy crucially hinges on the financial independence of a central bank, which can be evidenced, inter alia, by its financial strength. Using a new simulation of the financial results of the European Central Bank (ECB), this paper shows that the reported annual profit and financial buffers of a central bank can be significantly affected by accounting, profit distribution and loss coverage rules. Second, in respect of financial stability, the accounting frameworks applied by commercial banks can not only affect their behaviour, but also that of financial markets. Indeed, there is evidence that accounting frameworks amplified pro-cyclicality during the recent crisis, and thus posed risks to the stability of the financial system. This being so, the accounting frameworks of credit institutions have obvious implications for central banks’ analyses with regard to promoting financial stability. Finally, as regards banking supervision, regulatory reporting and key supervisory ratios are based on accounting data. Under the new regulatory framework for banks in the European Union (EU), bank supervisors are highly reliant on accounting data. This means that central banks, in their role as bank supervisors, need to understand the underlying accounting rules and should directly support the development and application of harmonised accounting frameworks.
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Majewska-Jurczyk, Barbara. "European Banking Union – an institutional analysis." Central European Review of Economics and Management 5, no. 1 (December 17, 2020): 59–75. http://dx.doi.org/10.29015/cerem.896.
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Aim: The Banking Union is an important step towards a genuine Economic and Monetary Union. The strengthening of the European banking system has become a topic of debate since the 2008 crisis when it became clear that stability and security of the system security may require increased supervision over operations conducted. The Banking Union was created to avoid the situation that taxpayers are first in line to pay for bailing out ailing banks. The Banking Union consists of three pillars: 1) the Single Supervisory Mechanism (SSM), which centralizes supervision of European banks around the European Central Bank, 2) the Single Resolution Mechanism (SRM), which the main purpose is to ensure the efficient resolution for recapitalization failing banks, and 3) the European Deposit Insurance Scheme (EDIS), which is still unfinished. The creation of the Banking Union is accompanied by a remarkable transfer of sovereignty to the European level. This article aims to provide an overview of the changes unfolding across the Banking Union from a law and economics perspective and to explain the role of the European Central Bank in supervision over the banking system, which is different from the policy of controlling prices through determining the level of interest rates and keeping inflation under control.
Design/Research methods: The analysis of the functioning Banking Union is based on the review of literature and analysis of reports and legal acts.
Findings: The Banking Union supports financial integration in the EU by implementing a common set of rules and a common supervisory and resolution mechanism. The creation of the Deposit Insurance Scheme is likely to contribute to the protection of banks and consumers in case of a potential future crisis. The author argues that the European Central Bank as a supervisor of the financial market should create a second supervisory body, which would significantly strengthen the system and allow the ECB more efficiently fulfill its task as chief supervisor.
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Acharya, Viral V., Denis Gromb, and Tanju Yorulmazer. "Imperfect Competition in the Interbank Market for Liquidity as a Rationale for Central Banking." American Economic Journal: Macroeconomics 4, no. 2 (April 1, 2012): 184–217. http://dx.doi.org/10.1257/mac.4.2.184.
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We study interbank lending and asset sales markets in which banks with surplus liquidity have market power vis-à-vis banks needing liquidity, frictions arise in lending due to moral hazard, and assets are bank-specific. Surplus banks ration lending and instead purchase assets from needy banks, an inefficiency more acute during financial crises. A central bank acting as a lender-of-last-resort can ameliorate this inefficiency provided it is prepared to extend potentially loss-making loans or is better informed than outside markets, as might be the case if it also performs a supervisory role. This rationale for central banking finds support in historical episodes. (JEL E58, G01, G21, G28, L13, N21)