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Anginer, Deniz, Asli Demirgüç-Kunt, and Davide Salvatore Mare. "Bank regulation and risk in Europe and Central Asia since the global financial crisis." Risk Governance and Control: Financial Markets and Institutions 10, no. 1 (2020): 75–93. http://dx.doi.org/10.22495/rgcv10i1p6.
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This paper examines changes in bank capital and capital regulations since the global financial crisis, in the Europe and Central Asia region. It shows that banks in Europe and Central Asia are better capitalized, as measured by regulatory capital ratios, than they were prior to the crisis. However, the increase in simple equity ratios for the same banks has been smaller over the past 10 years. The increases in regulatory capital ratios have coincided with a reduction in the stringency of the definition of Tier 1 capital and reduction in risk-weights. We further analyze the relationship between bank capital and bank risk using individual bank data. We show that bank risk in Europe and Central Asia is more sensitive to changes in simple leverage ratios than changes in regulatory capital ratios, consistent with the notion that equity ratios only include high-quality capital and do not rely on internal risk models to compute risk-weights. Although there has been some effort to increase capital and liquidity requirements for institutions deemed systemically important, the region has been lagging in addressing the resolution of these institutions. In line with Demirguc-Kunt, Detragiache, and Merrouche (2013), our findings show the importance of the definition of bank capital to assure bank financial stability in Europe and Central Asia.
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Rincón-Castro, Hernán, Norberto Rodríguez-Niño, and Jorge Hernán Toro-Córdoba. "ARE CAPITAL CONTROLS AND CENTRAL BANK INTERVENTION EFFECTIVE?" Investigación Económica 79, no. 313 (June 15, 2020): 31. http://dx.doi.org/10.22201/fe.01851667p.2020.313.76064.
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Tovar Mora, Camilo Ernesto, Pedro Castro, and Gustavo Adler. "Does Central Bank Capital Matter for Monetary Policy?" IMF Working Papers 12, no. 60 (2012): 1. http://dx.doi.org/10.5089/9781463937782.001.
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Adler, Gustavo, Pedro Castro, and Camilo E. Tovar. "Does Central Bank Capital Matter for Monetary Policy?" Open Economies Review 27, no. 1 (July 7, 2015): 183–205. http://dx.doi.org/10.1007/s11079-015-9360-1.
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Tanaka, Atsushi. "Central Bank Capital and Credibility: A Literature Survey." Comparative Economic Studies 63, no. 2 (February 1, 2021): 249–62. http://dx.doi.org/10.1057/s41294-020-00142-z.
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Utama, Cynthia A., and Haidir Musa. "The Causality between Corporate Governance Practice and Bank Performance: Empirical Evidence from Indonesia." Gadjah Mada International Journal of Business 13, no. 3 (September 12, 2011): 227. http://dx.doi.org/10.22146/gamaijb.5481.
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The aim of this study is to examine the existence of causality between corporate governance practice and performance of commercial banks in Indonesia. We also investigate the influence of age, capital adequacy, and type of commercial banks on bank performance and examine the influence of the bank size, foreign ownership, and listing status on corporate governance practice. The result shows that corporate governance practice, bank size and capital adequacy ratio have positive influences on bank performance in Indonesia. However, bank performance does not influence corporate governance practice. This study also finds that regional banks have better performance than private banks. The results of the study support the Central Bank’s efforts to enhance CG practices in the banking sector, to strenghten banks’ capital base and its policy to encourage banks to merge to become larger.
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Jeanne, Olivier, and Lars E. O. Svensson. "Credible Commitment to Optimal Escape from a Liquidity Trap: The Role of the Balance Sheet of an Independent Central Bank." American Economic Review 97, no. 1 (February 1, 2007): 474–90. http://dx.doi.org/10.1257/aer.97.1.474.
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Central banks target CPI inflation; independent central banks are concerned about their balance sheet and the level of their capital. The first fact makes it difficult for a central bank to implement the optimal escape from a liquidity trap, because it undermines a commitment to overshoot the inflation target. We show that the second fact provides a solution. Capital concerns provide a mechanism for an independent central bank to commit to inflate ex post. The optimal policy can take the form of a currency depreciation combined with a crawling peg, a policy advocated by Svensson as the “Foolproof Way” to escape from a liquidity trap. (JEL E31, E52, E58, E62)
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Kouam, Henri. "Financial stability and liquidity risks in the banking sector across the CEMAC region." Business & Management Studies: An International Journal 9, no. 1 (March 25, 2021): 343–54. http://dx.doi.org/10.15295/bmij.v9i1.1788.
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How does credit from the financial sector and claims on the central government affect banking sector liquidity and financial stability risks? This paper constructs an algorithm, which investigates the impact of domestic credit from the financial sector, bank to capital assets ratio, claims on the central government on banking sector liquidity – a proxy for financial stability. The results show a positive and statistically significant impact of the capital assets ratio on the bank's liquidity of 3.1%. It equally finds that domestic credit and claims on central government hurt bank liquidity, notably of -0.15% and -2.5%, respectively. The study recommends that commercial banks invest in higher-value domestic projects to improve their profitability over the long-run, thereby boosting financial stability. Furthermore, the central bank should make additional liquidity for banks contingent on the amount of credit they provide to the real economy.
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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 (October 20, 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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Talukdar, Sovanbrata. "Magical banking capital: Neo-endogenous money (NEM)." Corporate and Business Strategy Review 1, no. 1 (2020): 27–35. http://dx.doi.org/10.22495/cbsrv1i1art3.
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This research emerges with internal financial constraint. How financial constraint may lead to economic recess or back. This financial constraint is different than external finance constraint, and is not due to lack of gold, etc. It explains the positive relationship between excess return in stock market (ERSM) and non-real funding or riskier credit. The matter comes under imperfect market banking. It includes subsequently banking behavior and failure of central bank policy to control individual banks under these circumstances. In addition, it presents measures to get awareness before default comes, as financial default rare and crisis in financial market comes much before that.
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AL Qaisi, Fouzan. "The role of corporate governance in reducing the global financial crisis implications in light of the Central Bank of Jordan." Banks and Bank Systems 15, no. 3 (August 3, 2020): 10–19. http://dx.doi.org/10.21511/bbs.15(3).2020.02.
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The study aims to test the role of the measures implemented by the Central Bank of Jordan to reduce the effect of financial crisis on the Jordanian banks, using two independent variables (loans and advances rate, overnight deposit window), which are the actions of the Central Bank of Jordan, and four dependent variables (liquidity ratio, ROA ratio, capital adequacy ratio, non-performing loans ratio), which are financial stability indicators for the banks for six years (2005–2011). To get the study results, these data are measured and analyzed using SPSS (Statistical Package for Social Sciences). It was found that the actions of the Central Bank of Jordan (loans and advances rate, overnight deposit window rate): have a statistically significant impact on the non-performing loans ratio (2005–2011); do not have a statistically significant impact on the capital adequacy ratio (2005–2011); have a statistically significant impact on ROA ratio (2005–2011); do not have a statistically significant impact on the liquidity ratio (2005–2011).
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Lestari, Dian Rizqi, and Noven Suprayogi. "PENGARUH FAKTOR INTERNAL DAN FAKTOR MAKROEKONOMI TERHADAP STABILITAS BANK UMUM SYARIAH DI INDONESIA PERIODE 2012-2018." Jurnal Ekonomi Syariah Teori dan Terapan 7, no. 11 (November 29, 2020): 2062. http://dx.doi.org/10.20473/vol7iss202011pp2062-2073.
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ABSTRAKPenelitian ini bertujuan untuk mengetahui pengaruh ukuran bank, efisiensi, capital buffer, PDB, Inflasi, dan suku bunga terhadap tingkat stabilitas Bank Umum Syariah di Indonesia periode 2012-2018. Penelitian ini menggunakan data panel dan metode z-score dalam mengukur stabilitas. Data diambil dari website resmi Badan Pusat Statistik (BPS) dan annual report masing masing bank umum syariah. Hasil penelitian ini menunjukkan variabel ukuran bank (size), efisiensi, capital buffer, PDB (Produk Domestik Bruto), inflasi dan suku bunga (BI rate) secara simultan memiliki pengaruh yang signifikan. Kata Kunci: Stabilitas, Bank Umum Syariah, ukuran bank, efisiensi, capital buffer, PDB, Inflasi, suku bunga ABSTRACTThis study aims to determine the effect of bank size, efficiency, capital buffer, GDP, inflation, and interest rates on the level of stability of Sharia Commercial Banks in Indonesia for the period of 2012-2018. This study uses panel data and z-score method in measuring stability. This study used data obtained from the official website of the Central Statistics Agency and the annual report of each Islamic commercial bank. The results of this study indicate that the variable of bank size, efficiency, capital buffer, GDP (Gross Domestic Product), inflation and interest rates (BI rate) simultaneously have a significant effect.Keywords: Stability, Sharia Commercial Banks, bank size, efficiency, capital buffer, GDP, inflation, and interest rates
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Nistor, Simona. "Banks’ Vulnerability and Financial Openness across Central and Eastern Europe." Studia Universitatis Babes-Bolyai Oeconomica 62, no. 3 (December 1, 2017): 47–66. http://dx.doi.org/10.1515/subboec-2017-0013.
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Abstract This paper investigates the impact of the degree of capital account openness on banks’ exposure to extreme events during the period 2005-2012 using a sample of financial institutions from Central and Eastern Europe. The empirical output highlights a positive and strongly significant impact of a higher degree of financial openness on banks’ systemic vulnerability. Robust findings suggest that this harmful effect is lower for foreign owned banks or for those whose bank holding company signed one or more Vienna Initiative commitment letters. On the other side, tighter capital regulations and private monitoring policies enhance the positive impact of a higher degree of capital accounts openness on banks’ vulnerability to systemic events.
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Olszak, Małgorzata. "The Role of Capital Regulation and Risk-Taking by Banks in Monetary Policy." Oeconomia Copernicana 5, no. 1 (March 31, 2014): 7–26. http://dx.doi.org/10.12775/oec.2014.001.
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The credit boom prevailing in the period preceding the last financial crisis was prolonged and associated with neither particularly strong output growth nor rising inflation in economies in which it occurred. This type of credit cycle and financial cycle is hard to reconcile with existing economic theory applied in monetary policy. In this paper we point out to endogenous factors behind this phenomenon. We aim to identify what is the role of bank capital regulation and bank risktaking in the transmission mechanism of monetary policy. The transmission of monetary policy impulses through capital channel is a diversified process, and depends on bank specific, background macroeconomics’s specific and other factors. Bank capital standards affect the banks’ perception, management and pricing of risks. In this area, monetary policy is also of great importance, with prominent role of the so called risk-taking channel in which central banks actions have an impact on bank risk attitudes. Consequently monetary policy is not fully neutral from a financial stability perspective. Stable level of inflation does not guarantee the stability of financial system. Therefore central banks in their conduct of monetary policy should constrain the build-up of financial imbalances.
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Nicolay, Rodolfo Tomás da Fonseca, Claudio Oliveira de Moraes, and Bruno Pires Tiberto. "The Effect of Central Bank Communication on the Capital Buffer of Banks: Evidence from an Emerging Economy." Econometric Research in Finance 3, no. 1 (September 3, 2018): 1–26. http://dx.doi.org/10.33119/erfin.2018.3.1.1.
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The global financial crisis has revealed that the coordination between monetary policy and financial stability should be part of economic policy. This study examines the effects of monetary policy on the capital buffer (financial stability proxy) in the Brazilian economy and, in particular, how communication about both monetary policy and normative macroprudential policy affect the capital buffer maintained by banks. The study presents three main results: i) banks react strongly to monetary policy changes by increasing (reducing) the capital buffer in response to an increase (decrease) in the interest rate; ii) banks increase (decrease) the capital buffer when the central bank monetary policy communication signals an increase (decrease) in interest rates; and iii) banks use the capital buffer to accommodate the new measures of regulatory capital: the announcement of restrictive (liberalizing) capital measures reduces (increases) the capital buffer.
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Ramadhan, Mohammad Iqbal Bagus, Ahim Abdurahim, and Hafiez Sofyani. "Modal Intelektual Dan Kinerja Maqashid Syariah Perbankan Syariah Di Indonesia." JURNAL AKUNTANSI DAN KEUANGAN ISLAM 6, no. 1 (February 22, 2019): 5–18. http://dx.doi.org/10.35836/jakis.v6i1.6.
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This study aims to analyze the influence of Islamic banking-intellectual capital (ib-vaic) covered; capital employed, human capital, and structural capital, toward maqashid shariah performance in Islamic Banking in Indonesia. This study used all (44 banks) Islamic banking that listing in Bank Indonesia (Central Bank of Indonesia) and Otoritas Jasa Keuangan (Financial Services Authority). Data analysis used SPSS (Statistical Product and Service Solutions) with multiple regression method. The results reveal that Islamic banking-human capital have positive influence on maqashid shariah performance. However, Islamic banking-capital employed and structural capital do not have influence on maqashid shariah performance.
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Nedzvedskas, Jonas, and Povilas Aniūnas. "TRANSFORMATIONS IN RISK MANAGEMENT OF CURRENCY EXCHANGE IN LITHUANIAN COMMERCIAL BANKS." Technological and Economic Development of Economy 13, no. 3 (September 30, 2007): 191–97. http://dx.doi.org/10.3846/13928619.2007.9637799.
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After the adoption of International Convergence of Capital Measurement and Capital Standards (widely known as Basel II requirements) in 2004 the risk management in commercial banks has changed dramatically. Lithuanian commercial banks are in transitional period now adapting their risk management systems to Basel II requirements. Market risk is considered one of the key risks in bank risk management structure, so proper management of market risk is essential for a modern bank. Currency exchange risk usually is the main component of market risk. Currency exchange risk management in Lithuanian commercial banks was not good enough; also the Central Bank's regulatory limits were liberal. But after the adoption of Basel II requirements, the entire risk management system is transforming and currency exchange risk management is affected. The objective of this paper is to demonstrate the transformations of currency exchange in Lithuanian commercial banks and propose an effective model for commercial banking. These transformations are performed in the regulatory system imposed by the Central Bank of Lithuania and through transformations of the bank's internal risk management system moving to internal (usually VaR based) models. VaR models are considered as modern methods for risk management. These models proposed by Central bank or other authorities for internal and statutory risk management in commercial banks. In this article, the proposed variation‐covariation VaR model was tested with real data using the back‐testing method. Back‐testing showed that the proposed model is reliable enough, because the number of mismatches was less than 5 % in all tested currency pairs during all testing. In most currency pairs mismatches percentage was lower than 3 %. Back‐testing results confirm that the VaR method is reliable enough for day‐to‐day using by financial institutions and traders.
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Kalaitzake, Manolis. "Central banking and financial political power: An investigation into the European Central Bank." Competition & Change 23, no. 3 (November 15, 2018): 221–44. http://dx.doi.org/10.1177/1024529418812690.
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In the aftermath of the 2008 financial crisis, there has been a major scholarly revival of the topic of financial political power and a refocus on questions concerning democracy, elites, and inequality. Nevertheless, there remains a dearth in the literature regarding the precise nature of the political relationship between the financial sector and central banks. This is problematic given the sharp rise in institutional prominence enjoyed by central bank officials in the post crisis era and their fundamental importance in the governance of financial markets. As a corrective, this paper develops a provisional analytical framework through which the power dynamics between the financial sector and central banks can be fruitfully explored, specifically with reference to the European Central Bank. It does so by identifying four mechanisms through which financial actors potentially influence the policy choices of the European Central Bank – revolving doors, closed policy circles, capital flight/disinvestment, Too Big to Fail – and illustrates their operation empirically in the context of the bank’s organizational functioning and post crisis interventions. The paper illustrates how financial actors enjoy systematic advantages in the domain of central bank policymaking and provides significant evidence that the European Central Bank has been a key ally of the financial sector throughout the Eurozone crisis. The paper calls for a more extensive examination by scholars of the financial sector-central bank relationship as a means to clarify the precise scope of, and limitations to, contemporary financial political power.
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Haritchabalet, Carole, Laetitia Lepetit, Kévin Spinassou, and Frank Strobel. "Bank capital regulation: Are local or central regulators better?" Journal of International Financial Markets, Institutions and Money 49 (July 2017): 103–14. http://dx.doi.org/10.1016/j.intfin.2017.02.007.
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OGOWEWO, TUNDE I., and CHIBUIKE UCHE. "(MIS)USING BANK SHARE CAPITAL AS A REGULATORY TOOL TO FORCE BANK CONSOLIDATIONS IN NIGERIA." Journal of African Law 50, no. 2 (October 2006): 161–86. http://dx.doi.org/10.1017/s0021855306000143.
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This paper is a critique of the policy-making process and the particular policy choice made by the Central Bank of Nigeria with respect to the recent increase in the minimum share capital requirement for Nigerian banks. The article questions the apparent prioritization by the Central Bank of banking supervision – important though it is – over macro-economic stability. It also draws attention to serious public law issues (breach of monetary law and abuse of power) and the private law implications (conflicts of interests, scheme of arrangement defects, and negligent valuations) of this policy-making episode and policy choice.
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Sari, Ratna Kurnia, and Husni Mubarok. "ANALISIS PENERAPAN METODE RGEC GUNA MENILAI TINGKAT KESEHATAN PERBANKAN SYARIAH TAHUN 2015-2017 (STUDI KASUS PADA PT. BANK CENTRAL ASIA SYARIAH)." BALANCE: Economic, Business, Management and Accounting Journal 17, no. 1 (January 29, 2020): 34. http://dx.doi.org/10.30651/blc.v17i1.4193.
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In the economic system, banking has an important role in, supporting the economic progress of a country. In Indonesia alone, banking is known to be of two types, namely conventional banks and Islamic banks. Conventional banks usually refer to the interest system, which is most likely to be affected by the crisis. Whereas Islamic banks refer more to the profit sharing system and approach the community and reduce the risk or monetary fluctuation. The purpose of this study was to look at the health level of PT. Bank Central Asia Syariah using the RGEC method which includes risk profile, good corporate governance, earning and capital for 3 years. The result of the study in general showed that the health level of PT. Bank Central Asia Syariah in term of RGEC in 2015-2016 is in the position of composite rank 3 in a fairly healthy condition. Whereas in 2017 it was in the position of composite rank 2 in a healthy state. And to maintain public trust as the owner of the funds, stakeholders, and the government as supervisors, PT. Bank Central Asia Syariah is expected to be able to improve the ability of assets, capital management, and operational income, so that the quality of bank profits can be maintained and even improved. Keywords : Analysis, PT. Bank Central Asia Syariah, RGEC Method
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Klepczarek, Emilia. "Determinants Of European Banks' Capital Adequacy." Comparative Economic Research. Central and Eastern Europe 18, no. 4 (December 17, 2015): 81–98. http://dx.doi.org/10.1515/cer-2015-0030.
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This paper examines the factors affecting the Common Equity Tier 1 Ratio (CET1), which is a measure of the relationship between core capital and the risk-weighted assets of banks. The research is based on a randomly selected sample from the group of banks examined by the European Central Bank authorities. The ECB conducted stress tests assessing the CET1 Ratio with respect to the Basel III regulations. The findings confirm the hypothesis about the impact of bank size and the risk indicators (risk-weight assets to total assets ratio and the share of loans in total assets) on banks’ capital adequacy. They also confirm strong effect of competitive pressure and the negative correlation between the CET1 Ratio and the share of deposits in non-equity liabilities, which may be explained by the existence of the deposit insurance system. Finally the paper presents the limitations of the study and conclusions regarding possible further research in this subject area.
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Belke, Ansgar, and Edoardo Beretta. "Not the Time for Central Bank Digital Currency." Credit and Capital Markets – Kredit und Kapital: Volume 53, Issue 2 53, no. 2 (April 1, 2020): 147–58. http://dx.doi.org/10.3790/ccm.53.2.147.
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Abstract This short article addresses several important (but less discussed) aspects of the introduction of central bank digital currency that give cause for concern, no matter whether such a currency is intended as a substitute or a complement to cash. It discusses potential effects, such as bank runs and capital flight, and analyzes possible interactions between central bank digital currency and the limits on cash payments that already exist in several European countries. What are the structural characteristics that still make paper money and coins (the only means of payment directly issued by central banks) irreplaceable? These and other issues (including effects of COVID-19 on cash payment limits) are explored through a discursive approach that is simultaneously grounded in rigorous macroeconomic analysis. JEL Classification: E51, E58, E71
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Magdalena, Annaria, Bintang S. Marpaung, and Indira E. M. "The Effects Of Bank Funds Sources On Bank Profitability In Indonesia Stock Exchange." Riset 1, no. 2 (September 28, 2019): 090–98. http://dx.doi.org/10.35212/riset.v1i2.23.
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The purpose of this research is to analyze the effect of bank funding source to bank profitability. Indicators that are used for this research are Capital Adequacy Ratio, loan received, and third-party funds to Profitability. Population that used on this research are a commercial banks that listed on the Indonesia Stock Exchange. The sample that used are four commercial banks are PT. Bank Mandiri (Persero) Tbk, PT. Bank Rakyat Indonesia (Persero) Tbk, PT. Bank Negara Indonesia (Persero) Tbk, dan PT. Bank Central Asia Tbk on period of 2010-2018.
Method that used for this research is using multiple regression analysis by hypothesis test which are, T test and F test. The results of partial hypothesis (T Test) shows that Capital Adequacy Ratio and loan that received has a negative significant influence on Profitability. Meanwhile, Third-party funds have a positive significant influence Profitability. From the results of simultaneous hypothesis testing (F Test) shows that Capital Adequacy Ratio, loans received, and Third-party funds have a significant influence to banks profitability on commercial bank that are go public with significance of 0,000. R square value (R2) on this research is 0,517 or 51,7% and the rest is 48,3% affected by other factor that are not research.
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Pracoyo, Antyo, and Aulia Imani. "Analysis of The Effect of Capital, Credit Risk, and Liquidity Risk on Profitability in Banks." Jurnal Ilmu Manajemen & Ekonomika 10, no. 2 (September 26, 2018): 44. http://dx.doi.org/10.35384/jime.v10i2.80.
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This research aims to analyze the influence of bank-specific component to profitability of banking industry within the classification of commercial banking category 3 (Bank Umum Kegiatan Usaha 3, classification based on Central Bank of Indonesia) in the period of 2011 until 2015. The number of sample for this research are 8 banks or Bank Devisa. Independent variable used for this research are based on the ratio of banks. There are Capital measured by Capital Adequacy Ratio, Credit Risk measured by Non Performing Loan, and Liquidity Risk measured by Loan to Deposit Ratio. While dependent variable Profitability measured by Return On Assets. This research analyzed using Eviews 7 program for Panel Data Regression. The result of this research shows that Capital and Liquidity Risk has insignificance effect to Profitability. Meanwhile, Credit Risk has significant effect to Profitability
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Shubita, Moade Fawzi, Peter Harris, and Abdulla Ahmed Felaifel. "Development Of Payment System: Case Of Central Bank Of Bahrain." International Business & Economics Research Journal (IBER) 13, no. 1 (December 31, 2013): 121. http://dx.doi.org/10.19030/iber.v13i1.8368.
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This study analyses the payment system of the Central Bank of Bahrain based on interviews with bankers in addition to distributing 70 questionnaires to seven banks. The study presents the historical development of the Central Bank of Bahrain and reviews related studies. The results show that the value relevance of the payment system is important and there are various new tools for implementing this system. Further, the analysis reveals that there is a need to develop the infrastructure to fit the needs of Bahrain as the financial capital of the Middle East.
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Marwansyah, Sofyan, and Sri Rusiyati. "Dampak Kebijakan BI Rate Repo 7 Days terhadap Kinerja Bank Pemerintah." Jurnal Ecodemica: Jurnal Ekonomi, Manajemen, dan Bisnis 3, no. 2 (September 9, 2019): 248–56. http://dx.doi.org/10.31311/jeco.v3i2.6345.
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The policy to overcome the inflation lane is usually the central bank uses an interest rate policy called the BI Rate, but the BI Rate policy is deemed ineffective for banks because it requires a long time to a year, so the central bank issues a 7-day BI Rate Repo with the aim to effective in carrying out financial system policies. The purpose of this writing is first; to determine the influence of BI Rate Repo policy on Capital Ratios and Profitability ratios of Government banks, second; to see if there are significant differences in capital performance and profitability of government banks due to the 7 Days BI Rate repo policy. The research results obtained that the BI Rate has a negative significant relationship to the capital ratio (CAR) while the profitability ratio (ROE) has a positive significant relationship; The BI Rate affects the Capital Ratio (CAR) of 27.6% while the Profitability Ratio is 17.2%; The Capital Ratio Rate (CAR) has a significant difference between before the BI Rate Repo policy and after the policy which has increased from 18.65 to 20.42; The profitability ratio (ROE) has a significant difference between before the BI Rate Repo policy and after the policy, which decreased from 20.24 to 16.59.
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Sheikh, Nadeem Ahmed, and Muhammad Azeem Qureshi. "Determinants of capital structure of Islamic and conventional commercial banks." International Journal of Islamic and Middle Eastern Finance and Management 10, no. 1 (April 18, 2017): 24–41. http://dx.doi.org/10.1108/imefm-10-2015-0119.
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Purpose The purpose of this paper is to investigate how conventional and Islamic commercial banks in Pakistan choose their capital structure and what are the most significant factors that affect their choice of capital structure. Design/methodology/approach The authors collected the data from the annual reports of commercial banks listed on Karachi Stock Exchange Pakistan during 2004-2014. Panel data techniques, namely, pooled ordinary least squares, fixed effects and random effects, were used to estimate the relationship between book leverage and bank-specific variables such as profitability, size, growth, tangibility and earnings volatility. Findings Descriptive statistics indicate that conventional commercial banks are more levered than Islamic commercial banks. Moreover, conventional commercial banks are larger, profitable and have relatively safe earnings than Islamic commercial banks. In contrast, Islamic commercial banks have relatively more fixed operating assets and growth in total assets compared to the conventional commercial banks. Regression results indicate that profitability, growth and tangibility are negatively, whereas bank size and earnings volatility are positively, related to book leverage of conventional commercial banks. On the other hand, only three variables, namely, profitability, bank size and tangibility, have material effects on capital structure choice of Islamic commercial banks. Profitability and tangibility are negatively while bank size is positively related to book leverage of the Islamic banks. In sum, results of the study indicate that Islamic and conventional commercial banks have their own way to choose the capital structure than the non-financial firms; however, their choice is affected by the similar variables as identified for non-financial firms in Pakistan. Practical implications Results of this study provide support to bank managers to understand the effects of bank-specific variables on capital structure and make them able to determine a balanced capital structure considering the regulations framed by the central bank of the country. Originality/value This is the first study that investigates the factors that affect the capital structure of conventional and Islamic commercial banks in Pakistan. Moreover, findings of this study lay some foundation upon which a more detail analysis of capital structure of banks could be based.
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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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Qayyum, Abdul, Sajawal Khan, and Idrees Khawaja. "Interest Rate Pass-through in Pakistan: Evidence from Transfer Function Approach." Pakistan Development Review 44, no. 4II (December 1, 2005): 975–1001. http://dx.doi.org/10.30541/v44i4iipp.975-1001.
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The transmission of monetary policy through the interest rate mechanism has been thoroughly discussed in economic literature for quite some time. The traditional view is that, the change in real interest rate influences the cost of capital. The change in cost of capital affects the magnitude of investment and consumption and therefore the level of, real income and prices [Mishkin (1995)].1 Operationally the State bank of Pakistan, influences the yield on treasury bills (T-bills). This is done on the assumption that the yield on treasury bills influences other interest rates like the Money Market rate (Call money rate), banks’ deposit and banks’ Lending rates. The change in these rates influences the cost of capital and thus level of investment and consumption in the economy. Given this, the central bank can influence the yield on T-bills to influence the level of real income and the level of prices. The foregoing explanation of the monetary transmission mechanism makes it clear that if the changes in yield on the T-Bill rate are not passed on to the Call money rate and the bank deposit and the Lending rate then it becomes difficult for the central bank to use the channels that involve interest rate, for influencing the level of output and prices. Hence it is important to test whether the changes in the treasury bill rate are passed on to money market rate, bank deposit rate and the bank lending rate and if yes at what speed and to what extent. Therefore this study examines the pass-through of the changes in Treasury bill rate to Call Money rate, Banks’ deposit rate and Banks’ Lending rate.
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Mazreku, Ibish, Fisnik Morina, and Florentina Zeqaj. "Does working capital management affect the profitability of commercial banks: the case of Kosovo." European Journal of Sustainable Development 9, no. 1 (February 1, 2020): 126. http://dx.doi.org/10.14207/ejsd.2020.v9n1p126.
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Purpose: This paper aims to analyze working capital and its impact on the profitability of commercial banks. The other objectives of this study are to analyze the factors that influence the profitability of commercial banks, to find out the relationship between profitability and working capital management. To achieve these research objectives, several research questions have been posited: How much does working capital affect the profitability of commercial banks? What are the relationships between bank profitability and bank size, debt ratio and current ratio? What are the other factors affecting the profitability of commercial banks?
Methodology: The empirical data to be used in this research are secondary data and will be based on annual reports of commercial banks and reports of the Central Bank of Kosovo. From these data, some indicators such as return on assets, current ratio, debt ratio and banks’ size will be calculated. This research covers a period of 5 years and the data will be analyzed and interpreted through econometric models. In addition, to analyze the impact of working capital on the profitability of commercial banks in Kosovo, trend analysis will also be applied through the comparative method.
Findings: Based on the empirical results, we can conclude that bank size and the current ratio have positively affected the performance of commercial banks in Kosovo, whereas the debt ratio has had a negative effect. All the independent variables in relation to the dependent variable (ROA) are at the standard level of significance P-value = 0.05.
Practical implications: Through this study we can recommend all commercial banks in Kosovo to invest much more in working capital, since financial investments in working capital affect the bank's profitability. This means that a high investment in the elements of working capital can lead to increased bank profitability, whereas its profitability decreases when investment in working capital is low.
Originality: This paper presents real and sustainable results with respect to the conclusions. The period analyzed (2013-2017) is a persuasive period for drawing competent conclusions and recommendations.
Keywords: working capital, debt ratio, current ratio, bank size, return on assets
JEL Classification: G2, G20, G21, G3, G32, D24
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Sharifi, Sirus, Arunima Haldar, and S. V. D. Nageswara Rao. "Relationship between operational risk management, size, and ownership of Indian banks." Managerial Finance 42, no. 10 (October 10, 2016): 930–42. http://dx.doi.org/10.1108/mf-05-2015-0145.
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Purpose The purpose of this paper is to analyse the relationship between operational risk management (ORM), size, and ownership of Indian banks. This is important in the context of financial crisis experienced by developed countries due to lax regulation. Design/methodology/approach ORM practices of Indian banks are proxied by excess capital (over the required minimum capital for operational risk). Size of a bank is measured as deposits plus advances. Our sample includes 61 Indian banks during the period from 2010 to 2013. The authors empirically examine the impact of bank size on excess capital using panel data regression model. Findings The results suggest that size of Indian banks is inversely related to excess capital held by them for managing operational risk. The inverse relationship implies that smaller banks hold higher excess capital over the required minimum as per Basel norms. There is no significant relationship between ownership (public, private and foreign) and excess capital held by banks for managing operational risk. Practical implications The study has implications for Indian banks given the high level of losses due to bad loans, and the implementation of Basel III norms by the central bank, i.e. Reserve Bank of India. Social implications The study has implications for Indian financial system as a large percentage (about 33 per cent) of household savings are deployed in deposits with commercial banks and other financial institutions. The bank failure(s) can have disastrous consequences for the Indian economy as the capacity of the Indian financial system to withstand such shocks is highly doubtful. Originality/value There is very little evidence on ORM practices of Indian banks, and its relationship with size and ownership. The study assumes significance in the context of significant changes in the institutional and regulatory framework.
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Nikolaychuk, Sergiy, and Roman Pidvysotskyy. "Transformation of Central Banking. Annual Research Conference of the NBU. Key Issues." Visnyk of the National Bank of Ukraine, no. 236 (June 29, 2016): 6–18. http://dx.doi.org/10.26531/vnbu2016.236.006.
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In May 2016, the National Bank of Ukraine (NBU) held its Annual Research Conference of the NBU on Transformation of Central Banking for the first time. Over 300 participants shared in the work of the representative international forum, including experts from central banks and international financial organizations, as well as representatives of the Ukrainian and international academic community. Issues discussed during the conference included the recent development trends of in central bankings, ranging from the monetary policy at low interest rates and under the threat of deflation, financial stability and management of capital flows, and the effect of new financial technologies and cultural features on the transition process in central banks.
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GUDMUNDSSON, MÁR. "GLOBAL FINANCIAL INTEGRATION AND CENTRAL BANK POLICIES IN SMALL, OPEN ECONOMIES." Singapore Economic Review 62, no. 01 (March 2017): 135–46. http://dx.doi.org/10.1142/s0217590817400069.
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Global financial integration intensified in the period leading up to the Great Financial Crisis, as was witnessed by the growth of cross-border banking, capital flows, and gross external capital positions. For small, open economies (SOEs) that have lifted restrictions on capital movements, global financial integration seems to have undermined the scope for independent monetary policy, even if these countries had adopted a flexible exchange rate regime. Monetary policy transmission was weakened through the interest rate channel, as long-term rates in SOEs became increasingly correlated with long rates in large, advanced countries. The exchange rate channel was unstable, however, with exchange rates diverging from fundamentals as uncovered interest rate parity failed to hold over relevant periods and capital flows were volatile. These tendencies can contribute to monetary and financial instability when they interact badly with other economic and financial risks that can face small, open, and financially integrated economies. This was the case in Iceland. A fundamental rethinking of policy frameworks and tools has been underway in SOEs in the wake of the crisis. Potential policy instruments include foreign exchange intervention, enhanced prudential rules on foreign exchange risks, macroprudential tools, better alignment of fiscal and monetary policy, and even selective capital flow management tools.
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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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Aliefah, Aniesatun Nurul, and Lilis Renfiana. "Perbandingan Kinerja Bank Pembiayaan Rakyat Syariah dan Bank Perkreditan Rakyat di Indonesia." Al-bank: Journal of Islamic Banking and Finance 1, no. 2 (August 3, 2021): 135. http://dx.doi.org/10.31958/ab.v1i2.4262.
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The purpose of this study is to compare the performance of The Conventional Rural Bank (BPR) and Islamic Rural Bank (BPRS) in Indonesia using the REC method which consists of a risk profile, earnings, and capital during the 2015-2017 period. The risk profile factor is represented by the NPF indicator, income is represented by ROA and capital is represented by CAR. By using the purposive sampling method, as many as 43 Islamic Rural Bank (BPRS) and 63 Conventional Rural Bank (BPR) were obtained from secondary data sourced from annual financial reports published on the bank's official website. The analysis technique was then carried out using the Mann-Whitney-U test to compare the performance of the two banks. The results of this study indicate that there is a significant difference in NPF between the two banks at a significance level of 0.006; There is no significant difference in ROA and CAR between Islamic general financing banks and rural credit banks in Indonesia at the ROA significance level of 0.070 and CAR 0.239, respectively. The implication of this research implies that the performance of Islamic BPRs still has a great opportunity to develop in the future and is a big challenge, especially for the management of Indonesian Islamic BPRs and the central bank (Bank Indonesia) as a bank. regulators.
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Chęciński, Remigiusz, and Michał Przychodzki. "Introduction of the Concept of an Independent Central Bank into the Polish Political System in Light of the European Experience." Roczniki Nauk Prawnych 28, no. 3 ENGLISH ONLINE VERSION (October 28, 2019): 5–19. http://dx.doi.org/10.18290/rnp.2018.28.3-1en.
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The article is intended to outline the development of central banking in terms of its independence, with particular emphasis on the implementation of the idea of an independent central bank in Poland, also comparison with some other countries. The idea of central-bank independence was presented from personnel, financial and functional perspectives.
In the initial phase of their development, central banks were mainly established in the form of capital-based companies. Their position and importance was determined by special privileges. The Maastricht Treaty was a normative act that had a major influence on the shape of the currently dominant concept of an independent central bank, which pursues a free monetary policy at its own discretion. The Constitution of 1997 and the Act 29 August 1997 on the National Bank of Poland of were crucial in guaranteeing the strong position and independence of NBP from state authorities.
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Fitriningrun, Andriati, Andrey Hasiholan Pulungan, and Gilang Fajar Wijayanto. "The impacts of Acquisition on the Bidder’s Cash Flow Structure (The case of PT Central Sentosa Finance acquisition by PT Bank Central Asia)." Jurnal Manajemen 11, no. 2 (December 1, 2020): 126. http://dx.doi.org/10.32832/jm-uika.v11i1.3106.
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<p align="center"><em>The purpose of this study is to examine the impact of Merger and Acquisition (M&A) wave on constructing the capital structure. The conflict of government policies to assist the Small Medium Enterprises (SMEs) is in conflict with the other regulation which requires banks to meet the minimum Net Performing Loan (NPIL). This situation encourages the emergence of M&A wave in Indonesia. Numbers of banks do M&A as the option to accommodate the government regulations. Using the case of PT Central Sentosa Finance (CSF) acquisition by PT Bank Central Asia (BCA), this study examines the M&A impacts on the bidder’s capital structure when the acquisition due to the wave and government policy. The quantitative method is used to examine the impact of M&A on the company’s capital structure focusing the 2014 acquisition. The study contributes to the accounting in the area of transparency and capital issues. The statistical results show that the potential policies conflict drives the company to prioritize the selection of funding.</em></p><p><em> </em></p>
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CAVA, PATRICIA BENITES, ALEXANDRE PEREIRA SALGADO JUNIOR, and ADRIEL MARTINS DE FREITAS BRANCO. "EVALUATION OF BANK EFFICIENCY IN BRAZIL: A DEA APPROACH." RAM. Revista de Administração Mackenzie 17, no. 4 (August 2016): 62–84. http://dx.doi.org/10.1590/1678-69712016/administracao.v17n4p61-83.
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ABSTRACT Purpose: The research aims to evaluate the efficiency of banks that operated in the Brazilian market in 2013. To achieve this goal, efficient banks were identified according to the production approach. To detect and explain efficiency standards, additional analyses were carried out related to: 1. capital origin, 2. size, 3. business segment, and 4. risk rating. Originality/gap/relevance/implications: The Brazilian literature on bank efficiency features several studies linking the efficiency of banks to capital origin and size. However, the relationship between efficiency and business segment has been poorly explored and the relationship between efficiency and risk rating is scarce. In this sense, this research contributes to the literature by exploring the relationship between efficiency and business segment, as well as the relationship between efficiency and risk rating. Key methodological aspects: The research uses a quantitative approach and employs the Data Envelopment Analysis (DEA) technique to calculate efficiency scores. The data were obtained from the Central Bank of Brazil (Bacen). Summary of key results: Federal public banks and large banks are, on average, more efficient. Banks operating in foreign exchange and retail, as well as banks with high credit ratings, also achieved high levels of efficiency. Key considerations/conclusions: Efficient banks proved to be more profitable, lent less money in proportion to their total assets, and received fewer complaints filed with the Central Bank of Brazil in 2013.
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Amaluis, Dina, and Hayu Yolanda Utami. "CAMEL Ratio: An Approach To Measuring The Health Of Financial Institutions." JURNAL INOVASI PENDIDIKAN EKONOMI 9, no. 1 (April 30, 2019): 55. http://dx.doi.org/10.24036/011041710.
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This research aims at finding out the differences of health level of Financial Institution by using CAMEL. The magnitude of the potential financial institutions make profits in the segment of small and micro finance as a market for rural banks (BPR), especially Islamic rural banks (BPRS).. The level of Bank efficiency could be integrated with the performance of banks which was adopted from Central Bank (BI) criterias, namely CAMEL (Capital, Asset Quality, Management, Earnings and liquidity).
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Ivanović, Valentina. "Financial Independence of Central Bank through the Balance Sheet Prism." Journal of Central Banking Theory and Practice 3, no. 2 (May 1, 2014): 37–59. http://dx.doi.org/10.2478/jcbtp-2014-0010.
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Abstract The main reason for central bank independence lies in the fact that it is necessary to clearly distinguish spending money from the ability of making money. Independence of central banks is now a characteristic of almost all developed and highly industrialized countries. In this respect, it represents an essential part of the overall economic reality of these countries. Over the past decade or somewhat earlier, the issue of importance of central bank independence has been raised in developing countries, making the institutional, functional, personal and financial independence of central banks current topics for consideration. The key reason for the growing attention to financial independence of central banks is due to the effects of the global financial crisis on their balance sheets and therefore the challenges related to achieving the basic goals of the functioning of central banks - financial stability and price stability. Financial strength and independence of central banks must be developed relative to the policy and tasks that are carried out and risks they face in carrying out of these tasks. Financial independence represents a key base for credibility of a central bank. On one hand, the degree of credibility is associated with the ability of central banks to carry out their tasks without external financial assistance. In order to enhance the credibility of central bank in this regard, it must have sufficient financial strength to absorb potential losses and that power must be continuously strengthened by increasing capital and rearranging profit allocation arrangements. This is particularly important in times of crisis.
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Osei-Assibey, Eric, and Joseph Kwadwo Asenso. "Regulatory capital and its effect on credit growth, non-performing loans and bank efficiency." Journal of Financial Economic Policy 7, no. 4 (November 2, 2015): 401–20. http://dx.doi.org/10.1108/jfep-03-2015-0018.
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Purpose – This paper aims to investigate the influence of the central bank’s regulatory capital on commercial banks specific performance outcomes such as credit supply, interest rate spread (as a measure of efficiency) and non-performing loans (NPLs). Design/methodology/approach – Using specific commercial bank-level panel data from 2002-2012, a system of equations was modeled that allows us to apply the system generalized methods of moment approach and estimate the equations, while controlling for specific bank level, industry and macroeconomic variables. Findings – The study finds a positive relationship between a net minimum capital ratio and the net interest margin. Although this is in contrast with the study expectations, the result suggests that a high net minimum capital requirement would widen the spread between the lending and saving rates. The study further finds evidence to support the fact that high minimum capital requirement and excess capital above the minimum required drive credit growth in the banking sector of Ghana. However, high excess capital increases risk-taking activities of the banks, as excess capital is found to be associated with high NPL ratios. Practical implications – Given the economic benefits and costs of sharply increasing bank regulatory capital, our results speak to the ongoing debates on the right level of capital, the effectiveness of the Bank of Ghana policy rate (PR) and the high lending rates that appear to respond only slowly to macroeconomic indicators such as the PR and the inflation rate. The finding also has practical implications for the adoption of the Basel III accord. Originality/value – The empirical literature has not paid enough attention to the impact of regulatory capital on the three specific bank-level outcomes – NPLs, interest rate spread and the nature of interrelationships among these variables, particularly in the African context.
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Oyebowale, Adeola Y. "Determinants of Bank Lending in Nigeria." Global Journal of Emerging Market Economies 12, no. 3 (September 2020): 378–98. http://dx.doi.org/10.1177/0974910120961573.
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The willingness of commercial banks to provide loans is determined by various factors. In this regard, this paper provides empirical evidence on determinants of bank lending in Nigeria. The parsimonious model of this study investigates the impact of growth in loan-to-deposit ratio, growth in inflation, growth in broad money, and growth in bank capital on growth in bank lending using annual data from 1961 to 2016. This study adopts the autoregressive distributed lag (ARDL) bounds testing approach and Granger causality tests to investigate the relationship and direction of causality among the variables, respectively. The Granger causality tests show that growth in broad money Granger-causes growth in bank lending, while there is no causality from other explanatory variables to bank lending in Nigeria. Also, this study shows that growth in bank lending Granger-causes growth in loan-to-deposit ratio and growth in inflation in Nigeria. Thus, this paper argues that commercial banks in Nigeria exhibit stern concern for their liquidity and capital adequacy positions while acting as financial intermediaries. Additionally, this paper argues that the Central Bank of Nigeria (CBN) possesses “paper-based” independence.
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Warjiyo, Perry. "CENTRAL BANK POLICY MIX: KEY CONCEPTS AND INDONESIA’S EXPERIENCE." Buletin Ekonomi Moneter dan Perbankan 18, no. 4 (June 30, 2016): 379–408. http://dx.doi.org/10.21098/bemp.v18i4.573.
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The global crisis brings about renewed reforms on central bank policy. First, in addition to the traditional mandate of price stability, there are strong supports for additional mandate of the central bank to promote financial system stability. Second, macroprudential policy is needed to address procyclicality and build-up systemic risks in the macro-financial linkages of financial system that in most cases precede and deepen financial crisis. Third, monetary and financial stability are also prone to volatility of capital flows, especially for the emerging countries, and thus there is a need to manage them. The challenge is how to mix the policies of monetary, macroprudential, and capital flows management to meet the renewed mandate of central bank on monetary and financial stability. This paper reviews theoretical underpinnings and provides key concepts to address the issues. We show that central bank policy mix is both conceptually coherent and practically implementable. We provide a concrete recommendation with a reference from Indonesia’s experience since 2010. We also raise a number of challenges from practical point of views, especially relating to decision making process, forecasting model, and communication, for the success of the policy mix.
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Klovland, Jan Tore, and Lars Fredrik Øksendal. "The decentralized central bank: bank rate autonomy and capital market integration in Norway, 1850–1892." European Review of Economic History 21, no. 3 (April 24, 2017): 259–79. http://dx.doi.org/10.1093/ereh/hex004.
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M. Jume, Tijjani. "An Assessment of the Effectiveness of Central Bank Sterilization on Capital Inflows in Nigeria." Central Bank of Nigeria Journal of Applied Statistics, Vol. 11 No. 2 (April 8, 2021): 201–30. http://dx.doi.org/10.33429/cjas.11220.8/8.
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This paper assesses the monetary policy response of the Central Bank of Nigeria (CBN) to increases in capital inflows into Nigeria using monthly time series data from January 2009 to December 2017. It presents an econometric assessment of the degree to which the CBN sterilizes net foreign assets (NFA) in response to the capital flows, using Autoregressive Distributed Lag (ARDL) bounds testing approach. The long run sterilization coefficient obtained suggests that the CBN successfully offset 95per cent of capital inflows in the period of analysis. Against the background of rising financial instability in Nigeria, the study illustrates how sterilization has not adequately tackled the major risks of capital inflows which resulted in asset price bubbles and bursts, equity capital inflows reversal, banking crisis, and currency depreciation which contributed, partly, to the economic recession in 2016. The paper argues that effective policy response to capital inflows must adequately address the major downside risks of capital inflows in the short and medium terms through some clearly defined capital flows management and macro-prudential measures.
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Smirnov, Valery, Denis Osipov, Elena Lyubovtseva, Elvira Kuznetsova, and Ludmila Savinova. "Movement of the components of Russian financial capital." SHS Web of Conferences 106 (2021): 01015. http://dx.doi.org/10.1051/shsconf/202110601015.
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In the article there is revealed movement of financial capital components as a substance – the unity of diversity and the diversity of unity. Analysis of USD / RUB, RGBI, RTSI, SBER, IMOEX dynamics revealed speculative behavior of financial capital owners (IMOEX, USD / RUB, SBER) in relation to internal (RGBI) and external (RTSI) market. Analysis of importance of growth rates of GDP and its components revealed the state priority of GDP deflator regulation (Central Bank – inflation targeting) in the context of state revenues growth and, as a structural consequence, reduction of importance of growth rates of GDP and expenditures of households consumption against the background of increase of importance of commodities and services import. At the same time the quite high values of importance of growth rates of export of Russian commodities and services are identical to ones of such countries as Australia, Estonia and Columbia. Analysis of capital growth rates revealed fixation of interrelations between the Central Bank and financial corporations in the context of regulation of money supply and currency outside financial corporations and internal claims. These relations strengthen due to focusing of monetary and credit policy at “clear requirements to central government” and at inflation targeting. Research of the Russian financial capital components movement demonstrated corporate strengthening of interrelations between the Central Bank and the financial corporations and also defined the options for regulation of speculative behavior of financial capital owners.
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Silmi, Silmi, Kevry Ramdany, and Yudi Mufti Prawira. "“Is The Banking Industry The Right Choice To Invest?” (Analisis Laporan Keuangan PT. Bank Central Asia, PT. Bank Rakyat Indonesia, PT. Bank Nasional Indonesia, PT. May Bank dan PT. Bank Permata Periode 2013-2017)." Jurnal Ilmiah Universitas Batanghari Jambi 20, no. 2 (July 1, 2020): 652. http://dx.doi.org/10.33087/jiubj.v20i2.987.
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Financial statements are one of the analytical tools that contain information that can be used by potential investors to make investment decisions. Prospective investors need a capable and trusted analysis to analyze the financial statements of the industry in the Bank, to determine which banks need funds for short-term investors and long-term prospective investors involve investing their capital through the purchase of shares, explained to the Bank that provides funds as expected investment returns by potential investors even more. There are 5 banks that submit comparisons and assess their ratios and performance in this study so that potential investors can invest appropriately, expecting: PT. Bank Central Asia, PT. Bank Rakyat Indonesia, PT. Bank Nasional Indonesia, PT. May Bank and PT. Bank Permata, for 5 years analysis time period. From the results of research and analysis conducted, Bank BCA is the right choice for investors for short-term investors and BRI is the right choice for potential investors for long-term investment.
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Martius, Martius. "Analisis Perbandingan Tingkat Kesehatan BPR Konvensional dan BPR Syariah Central di Kota Batam." JUSIE (Jurnal Sosial dan Ilmu Ekonomi) 2, no. 01 (March 28, 2019): 52–61. http://dx.doi.org/10.36665/jusie.v2i01.115.
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Banking is one institution that an important role in the economic field of a country. Banking is anything about the bank, including institutions, business activities, and ways and processes in carrying out its business activities. The development of BPR businesses that continue to show positive performance is driven by three main factors: government policies that provide opportunities for BPR establishment, banking deregulation that enlarges the BPR space and the large needs of the community, especially in rural and urban areas, towards banking services. This research was conducted to know the analysis of the difference of health level in matters of Capital aspect, Asset, Management, Rentability, Liquidity and Capital between Conventional BPR and Syariah. Population in this research is all financial data of Conventional Rural Bank and BPR Syariah Kota Batam registered at Bank Indonesia. The sample in this research is the financial data of Conventional BPR and BPR Syariah in Batam for 2 years. Data analysis method used is CAMEL method. To measure the level of health of banking companies in general use Ratio Asset Quality and Earnings ,. Judging from the method of Quality Asset Ratio and Earning is generated a very good weight value so it can be concluded that the Conventional and Syariah Banks in 2014 and 2015 are in the healthy category.
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Omran, Qassem Ali. "Capital Adequacy and its Impact on Banking Liquidity Risk Applied Study in the Bank of the Islamic National and Commercial Iraqi for the Period (2012-2017)." JOURNAL OF UNIVERSITY OF BABYLON for Pure and Applied Sciences 27, no. 2 (March 31, 2019): 67–79. http://dx.doi.org/10.29196/jubpas.v27i2.2057.
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The aim of this paper is to highlight one of the risks facing the banking system in general and the Iraqi in particular, both Islamic and commercial, resulting from the low liquidity of banks from their safe levels, which expose the bank to a number of effects, especially when exposed to sudden withdrawals through measuring and analyzing the banking liquidity risk of banking and the statement The most important means used to processing these risks, including the adequacy of capital according to the Basel II Accord. Two banks, the National Islamic Bank and the Commercial Bank of Iraq, were selected and the indicators of liquidity risk were used. Statement of the Effect of the Capital Adequacy Tool as a Tool that Contributes to the Absorption of Banking Risks and their Effects in Mitigating Liquidity Risk The indicators were analyzed and tested by testing F, P-value and impact statement through the R2 parameter using the ANOVA analysis. There is a significant effect of the capital adequacy ratio on the liquidity risk of banks and both banks to varying degrees on the basis of which the alternative hypothesis was accepted. The paper also reached the recommendations of the most important of which is the need to achieve a balance between the size of the balances utilized in the various banking fields and what is maintained, Exceed the capital adequacy ratios for the specified rates by the Central Bank of Iraq.