scholarly journals Determinants of economic value added (EVA) in Chinese listed banks

2019 ◽  
Vol 27 (4) ◽  
pp. 595-613
Author(s):  
Jie Zhang ◽  
Ahmed Aboud
Keyword(s):  
Performance Evaluation ◽  
Banking Industry ◽  
Evaluation Model ◽  
Value Added ◽  
Measurement Tool ◽  
Content Type ◽  
Performance Evaluation Model ◽  
Chinese Banking Industry ◽  
The Impact ◽  
Chinese Banking

Purpose The purpose of this paper is to examine the determinants of the EVA performance evaluation model for the Chinese banking industry. The authors investigate the impact of six bank-specific factors and corporate governance factors on financial performance. Design/methodology/approach The authors use the ordinary least square regression to examine the determinants of the EVA performance evaluation model for the Chinese banking industry. The findings are generally robust to alternative proxies of performance. Findings The empirical results indicate that credit risk, operational efficiency and the degree of innovation are positively related to banks’ EVA while capital management has a negative impact on it. In addition, although board size and independent directors are not related to the bank’s EVA, from the perspective of the traditional performance evaluation indicators, executive compensation has a positive impact on the bank’s profitability. Research limitations/implications This paper has some limitations. First, due to the large number of adjustments to accounting items are required in the application of EVA when evaluating business performance, some items of the EVA model in this paper have been simplified, which may cause the bank’s EVA value to deviate slightly from the actual situation. Moreover, the sample includes only listed banks, so our results cannot generalize to non-listed banks, such as some small- and medium-sized commercial banks. Originality/value This paper contributes to the limited body of literature concerning the use and the determinants of EVA in emerging markets. The authors construct an EVA model which is suitable for China’s banks and reports comprehensive evidence on the drivers of EVA as a measurement tool.

scholarly journals Does competition only impact on insolvency risk? New evidence from the Chinese banking industry

2017 ◽  
Vol 13 (3) ◽  
pp. 332-354 ◽  
Author(s):  
Yong Tan ◽  
John Anchor
Keyword(s):  
Credit Risk ◽  
Commercial Banks ◽  
Banking Industry ◽  
Liquidity Risk ◽  
Empirical Literature ◽  
Content Type ◽  
Insolvency Risk ◽  
Chinese Banking Industry ◽  
The Impact ◽  
Chinese Banking

Purpose The purpose of this paper is to investigate the impact of competition on credit risk, liquidity risk, capital risk and insolvency risk in the Chinese banking industry during the period 2003-2013. Design/methodology/approach This study uses a generalized method of moments system estimator to examine the impact of competition on risk. In particular, translog specifications are used to measure the competition and insolvency risk. Findings The results show that greater competition within each bank ownership type (state-owned commercial banks, joint-stock commercial banks and city commercial banks) leads to higher credit risk, higher liquidity risk, higher capital risk, but lower insolvency risk. Originality/value This paper is the first piece of research testing the impact of competition on different types of risk in banking industry and it further contributes to the empirical literature by using a more accurate competition indicator (efficiency-adjusted Lerner index) and a more precise insolvency risk indicator (stability inefficiency).

scholarly journals Risk, competition, efficiency and its interrelationships: evidence from the Chinese banking industry

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Yong Tan ◽  
Vincent Charles ◽  
Doha Belimam ◽  
Shabbir Dastgir
Keyword(s):  
Credit Risk ◽  
Banking Sector ◽  
Banking Industry ◽  
Bank Competition ◽  
Content Type ◽  
Frontier Analysis ◽  
Different Types ◽  
Chinese Banking Industry ◽  
The Impact ◽  
Chinese Banking

PurposeThis study investigates the interrelationships between efficiency, competition and risk in the Chinese banking industry.Design/methodology/approachParametric stochastic frontier analysis is used to estimate bank efficiency; the Lerner index is used as the competition indicator; accounting ratios and a translog function are used to measure different types of risk and finally, the three-stage least square estimator is used to investigate the interrelationships.FindingsThe results of this study show that the impact of competition on different types of risk is significant and positive, while there is a significant and positive impact of credit risk, liquidity risk and capital risk on bank competition. In addition, the findings demonstrate that the interrelationships between efficiency and competition are significant and negative. The authors do not find any robust interrelationships between different types of risk and different types of efficiency; the authors find that diversification and higher levels of profitability reduce bank credit risk. The results suggest that a higher developed banking sector reduces the level of bank competition in China.Originality/valueThis is the first piece of research that comprehensively investigates the interrelationships between different types of risk, competition and different efficiencies in China.

Modeling and performance evaluation of PPP projects utilizing IFC extension and enhanced matter-element method

2020 ◽  
Vol 27 (8) ◽  
pp. 1763-1794
Author(s):  
Zhao Xu ◽  
Xiang Wang ◽  
Ya Xiao ◽  
Jingfeng Yuan
Keyword(s):  
Performance Evaluation ◽  
Evaluation Model ◽  
Indicator System ◽  
Project Performance ◽  
Information Modeling ◽  
Content Type ◽  
Evaluation Indicator ◽  
Performance Evaluation Model ◽  
Element Method

PurposeThere is often a lack of accurate performance evaluation in Public–Private Partnership (PPP) projects. It is a challenging issue to effectively use Building Information Modeling (BIM) for PPP project performance evaluation. The objective of this study is to develop a PPP project performance evaluation model based on Industry Foundation Classes (IFC) and an enhanced matter-element method to more precisely evaluate PPP project performance.Design/methodology/approachThe performance evaluation of PPP projects in the construction and operation period was explored. The PPP project performance evaluation indicator system was first established based on a literature review and PPP project practice. Then, the evaluation indicator information was expressed through IFC mapping and extension. After that, an IFC-based PPP project performance evaluation model was developed, and a case study was provided to validate the use of the proposed performance evaluation model.FindingsThe results of the case study show that the proposed approach can accurately and efficiently evaluate PPP projects, and it could favorably contribute to performance evaluation in PPP projects.Research limitations/implicationsThis study only concerns the performance evaluation of one type of PPP project. Further research is required to study different types of PPP projects; the model needs to be more efficient and intelligent.Originality/valueThe performance evaluation of PPP projects utilizing IFC extension and the enhanced matter-element method provides guidance for the government and private parties to accurately and efficiently evaluate PPP project performance.

A new supplier performance evaluation model

Kybernetes ◽  
2010 ◽  
Vol 39 (1) ◽  
pp. 37-54 ◽  
Author(s):  
He‐Yau Kang ◽  
Amy H.I. Lee
Keyword(s):  
Performance Evaluation ◽  
Integrated Circuit ◽  
Evaluation Model ◽  
Pairwise Comparison ◽  
Evaluation Process ◽  
Supplier Evaluation ◽  
Content Type ◽  
Supplier Performance ◽  
Performance Evaluation Model ◽  
Proposed Model

PurposeMost industries have become increasingly competitive nowadays, and a good supply chain relationship is essential for a company to survive and to acquire reasonable profit. Therefore, supplier selection is very important. The purpose of this paper is to propose a novel model for evaluating the performance of suppliers.Design/methodology/approachA supplier performance evaluation model based on analytic hierarchy process (AHP) and data envelopment analysis (DEA) is constructed. DEA is applied first to evaluate quantitative factors, and the results are transformed into pairwise comparison values for AHP analysis. Qualitative factors are also evaluated through AHP analysis, and a final ranking of suppliers can be obtained by combining the quantitative and qualitative results.FindingsThe proposed model can be applied to evaluate and select the most appropriate integrated circuit packaging company for outsourcing. With the incorporation of experts' opinions and the consideration of qualitative and quantitative factors, the model can provide a both subjective and objective supplier performance ranking.Practical implicationsThe proposed model can be tailored and applied to supplier evaluation and selection in other industries.Originality/valueAlthough many models are available for supplier evaluation, this paper considers both the subjective and objective performance characteristics simultaneously in the evaluation process.

scholarly journals The profitability of Chinese banks: impacts of risk, competition and efficiency

2017 ◽  
Vol 16 (1) ◽  
pp. 86-105 ◽  
Author(s):  
Yong Tan ◽  
Christos Floros ◽  
John Anchor
Keyword(s):  
Cost Efficiency ◽  
Commercial Banks ◽  
Banking Industry ◽  
Liquidity Risk ◽  
Security Risk ◽  
Bank Profitability ◽  
Content Type ◽  
Insolvency Risk ◽  
Chinese Banking Industry ◽  
Chinese Banking

Purpose This study aims to test the impacts of risk-taking behaviour, competition and cost efficiency on bank profitability in China. Design/methodology/approach A two-step generalized method of moments system estimator is used to examine the impacts of risk, competition and cost efficiency on profitability of a sample of Chinese commercial banks over the period 2003-2013. Findings The paper finds that credit risk, liquidity risk, capital risk, security risk and insolvency risk significantly influence the profitability of Chinese commercial banks. To be more specific, credit risk is significantly and negatively related to bank profitability; liquidity risk is significantly and positively related to return on assets (ROA) and net interest margin (NIM) but negatively related to return on equity (ROE); capital risk has a significant and negative impact on ROA and NIM but a positive impact on ROE; there is a significant and negative impact of security risk on bank profitability (ROA and NIM). It is found that Chinese commercial banks with higher levels of insolvency risk have higher profitability (ROA and ROE). Finally, higher competition leads to lower profitability in the Chinese banking industry, and Chinese commercial banks with higher levels of cost efficiency have lower ROA. In other words, the structure–conduct–performance paradigm rather than the efficient–structure paradigm holds in the Chinese banking industry. Originality/value This is the first paper to investigate the impact of different types of risk, including credit risk, liquidity risk, capital risk, security risk and insolvency risk, on bank profitability. This is the first study which uses more accurate measurements of efficiency and competition compared to previous Chinese banking profitability literature and which tests their impact on bank profitability. The findings not only provide a general picture on the risk, efficiency and competition conditions in the Chinese banking industry, but also give valuable information to the Chinese Government and to the banking regulatory authorities to make relevant policies.

scholarly journals Influence of the enterprise’s intelligent performance evaluation model using neural network and genetic algorithm on the performance compensation of the merger and acquisition parties in the commitment period

PLoS ONE ◽  
2021 ◽  
Vol 16 (3) ◽  
pp. e0248727
Author(s):  
Yuanyuan Luo ◽  
Da Ren
Keyword(s):  
Genetic Algorithm ◽  
Performance Evaluation ◽  
Performance Appraisal ◽  
Corporate Performance ◽  
Evaluation Model ◽  
Enterprise Performance ◽  
Compensation Mechanism ◽  
Commitment Period ◽  
Performance Evaluation Model ◽  
The Impact

The purpose is to study the performance compensation of the bid purchased during the mergers and acquisitions (M&A) process. An intelligent model of enterprise performance appraisal is built to analyze the performances of the acquired enterprises. First, the evaluation indicators of enterprise performance are selected from both financial and non-financial aspects. An enterprise performance appraisal model is established based on the neural networks and optimized by the factor analysis method and Genetic Algorithm (GA). The principal factors affecting enterprise performance are analyzed. Then the M&A parties’ performances during the M&A commitment period under the earnings compensation mechanism are analyzed quantitatively. Corresponding hypotheses and evaluation indicators are established. Mean test results and regression analyses demonstrate that the hypotheses proposed are valid under particular circumstances. Introducing the earnings compensation mechanism during the M&A process can improve the enterprise performance effectively so that the earnings forecasted in the commitment period are significantly higher than the historical profitability. Hence, the earnings compensation mechanism plays a positive role in guiding enterprise performance. Comparison with models proposed in previous research reveals that the output error ratio of the designed corporate performance evaluation model is 1.16%, which can effectively evaluate corporate performance. The above results provide a reference for studying the impact of the earnings compensation mechanism on enterprise performance during the M&A process.

A dynamic performance evaluation model suggestion for performance-based logistics

Kybernetes ◽  
2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mustafa Agdas ◽  
Cevriye Gencer
Keyword(s):  
Performance Evaluation ◽  
Evaluation Model ◽  
Dynamic Performance ◽  
Real Life ◽  
Public Institution ◽  
Fuzzy Data ◽  
Index Method ◽  
Suitable Alternative ◽  
Content Type ◽  
Performance Evaluation Model

PurposeThis study proposes a dynamic performance evaluation model to support the material availability of the public institution under performance- based logistics (PBL) and to select the most appropriate service provider.Design/methodology/approachThe model consists of four stages. In the first stage, a criteria set to evaluate alternatives is created. In the second stage, the DEA-MTFP index method is applied for performance evaluation of the alternatives by using crisp data. In the third stage, IFS theory is utilized for aggregating decision-maker judgments on alternatives, and in the last stage, the results of both methods are turned into single value, and it is selected as the most suitable alternative.FindingsIt is verified that the proposed approach can be implemented to the real-life dynamic multi-criteria decision-making (MCDM) problem that have crisp and fuzzy data under the PBL strategy.Practical implicationsThis paper offers an integrated approach for performance analysis of service providers in a dynamic MCDM problem in which crisp and fuzzy data are used together. To illustrate applicability and validity of the proposed model, it is applied to a real-life problem.Originality/valueThis paper utilizes the DEA-MTFP index method and IFS theory in an integrated way.

Developing and validating the components of Maqasid al-Shari’ah-based performance measurement model for Islamic banks

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Kazi Md Tarique ◽  
Rafikul Islam ◽  
Mustafa Omar Mohammed
Keyword(s):  
Performance Evaluation ◽  
Evaluation Model ◽  
Group Discussion ◽  
Relevant Literature ◽  
Well Being ◽  
Measurement Model ◽  
Performance Measure ◽  
Islamic Banks ◽  
Content Type ◽  
Performance Evaluation Model

Purpose The purpose of this paper is to develop and subsequently validate a Maqasid al-Shari’ah-based performance evaluation model for Islamic banks. Design/methodology/approach Initially, a comprehensive review of the existing and relevant literature is carried out and a prototype evaluation model has been developed. This has been augmented and refined through in-depth interviews of Shari’ah scholars and banking experts. Afterwards, the modified model has been validated by taking inputs from academics and Islamic banking practitioners through a focus group discussion. Findings The major outcome of the present work is a Maqasid al-Shari’ah-based performance evaluation model for Islamic banks. At the inception of the work, the Maqasid frameworks of Imam al-Ghazali and Abu Zahrah were combined. The combined model incorporates various dimensions, elements and the corresponding measures of three components, namely, justice, education and maslahah. Research limitations/implications Not being able to test the model statistically or empirically can be considered as a limitation. Practical implications The comprehensive theoretical framework of the developed model addresses all aspects of human well-being. Thus, if implemented the model will ensure welfare for all the stakeholders. It will also encourage the regulators to introduce new reporting standards which will be more reflective of Maqasid al-Shari’ah. Social implications Fulfilling Maqasid will create a positive brand image for Islamic banks, which will attract more customers both Muslims and non-Muslims. Thus, this will create a wider scope for earning more revenues. Originality/value There has been concern that Islamic banks are converging towards conventional banking systems and the same performance measure instrument is being used to evaluate the performance of both Islamic and conventional banks. The present work has developed a Maqasid al-Shari’ah-based performance evaluation model for Islamic banks.

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