The Stability of the Australian Banking Sector

2009 ◽  
pp. 397-416 ◽  
Author(s):  
Philip Stork ◽  
Casper de Vries
Keyword(s):  
Banking Sector ◽  
The Stability

The Systemic Effects of Prudential Regulation Toughening:The Results of a Stress-test for Russian Banks

2012 ◽  
pp. 4-31 ◽  
Author(s):  
M. Mamonov ◽  
A. Pestova ◽  
O. Solntsev
Keyword(s):  
Financial Services ◽  
Banking Sector ◽  
Stress Test ◽  
Credit Market ◽  
Capital Adequacy ◽  
Government Support ◽  
Government Ownership ◽  
Prudential Regulation ◽  
The Government ◽  
The Stability

The stability of Russian banking sector is threatened by three negative tendencies - overheating of the credit market, significant decrease of banks capital adequacy ratios, and growing problems associated with banks lending to affiliated non-financial corporations. The co-existence of these processes reflects the crisis of the model of private investments in Russian banking sector, which was observed during the last 20 years. This paper analyzes the measures of the Bank of Russia undertaken to maintain the stability of the banking sector using the methodology of credit risk stress-testing. Based on this methodology we conclude that the Bank of Russias actions can prevent the overheating of the credit market, but they can also lead to undesirable effects: further expansion of the government ownership in Russian banking sector and substitution of domestic credit supply by cross-border corporate borrowings. The later weakens the competitive positions of Russian banks. We propose a set of measures to harmonize the prudential regulation of banks. Our suggestions rely on design and further implementation of the programs aimed at developing new markets for financial services provided by Russian banks to their corporate and retail customers. The estimated effects of proposed policy measures are both the increase in profitability and capitalization of Russian banks and the decrease of banks demand for government support.

scholarly journals Political risk and banking sector performance in Nigeria

2021 ◽  
Vol 16 (3) ◽  
pp. 1-12
Author(s):  
Adefemi A. Obalade ◽  
Babatunde Lawrence ◽  
Joseph Olorunfemi Akande
Keyword(s):  
Credit Risk ◽  
Stock Price ◽  
Banking Sector ◽  
Generalized Method Of Moments ◽  
Banking System ◽  
Political Risk ◽  
Political Systems ◽  
Business Outcomes ◽  
Stage System ◽  
The Stability

Political risk is prevalent in Nigeria and tends to influence business outcomes and the stability of the banking system. As a result of this study, it was determined whether political risk matters to the performance of the banking sector in Nigeria. The effect of political risk on different banks’ performance measures, such as return on assets, return on invested capital, credit risk and stock price, were examined in a panel of 12 selected commercial banks for the period 2006–2018. Data was analyzed using a two-stage system of generalized method of moments. The results provided evidence that the effect of political risk on bank performance depends on the performance proxies. Specifically, political risk was found to be negatively related to banks’ returns on invested capital and positively related to deteriorating credit risk. Hence, it can be concluded that political risk induces poor banking system performance in Nigeria. The study provides a critical insight into the management of a country’s political systems in terms of their potential to create unfavorable conditions for banking systems to thrive.

scholarly journals Determinants of Polish financial stability in 2017-2018

2019 ◽  
Vol 30 (2) ◽  
pp. 5-19
Author(s):  
Kinga Górska ◽  
Karolina Krzemińska
Keyword(s):  
Financial Markets ◽  
Financial Stability ◽  
Banking Sector ◽  
Financial System ◽  
National Bank ◽  
The Stability

This article seeks to present the essentials of financial stability and to analyse and evaluate selected determinants of stability Poland’s financial system in the years 2017–2018. The study comprises exemplary ratios or indicators that are used in measuring the stability of a financial system. The proposed analysis is confined to selected groups of stability ratios/indicators that are pertinent to the macroeconomic situation, the situation in financial markets, and the situation of the banking sector. The analysis is based upon the data and statistics provided in the reports of the National Bank of Poland, available by 31st November 2018.

scholarly journals Формирование среды реализации цифровых инициатив сотрудников банка

2019 ◽  
pp. 48-54
Author(s):  
Тарас Гриценко ◽  
Жанна Передера ◽  
Анна Теряева
Keyword(s):  
Banking Sector ◽  
Economic Security ◽  
New Professionals ◽  
Advantages And Disadvantages ◽  
Study Results ◽  
The Matrix ◽  
Banking Business ◽  
The Stability ◽  
Definition Of ◽  
The Impact

В работе рассматривается возможность формирования в банковском секторе среды, в которой сотрудники смогут самостоятельно реализовывать цифровые инициативы для развития компании и самообучения. Обоснована необходимость её наличия. Проведен анализ соответствия поставленной проблемы российским и мировым трендам на основе изучения федеральных программ и оценок рейтинговых агентств. В результате исследования разработан бизнес-процесс реализации цифровых инициатив, про-веден конкурентный анализ его преимуществ и недостатков перед традиционным подходом к обучению. The article discusses the possibility of forming in the banking business an environment in which employees will be able to in-dependently implement digital initiatives for the development of the company and self-learning. The necessity of its presence is grounded. The analysis of compliance of the problem with the trends in Russia and the world based on the study of Federal programs and ratings agencies. To attract new staff with the necessary knowledge, banks have a number of tools - business classes, sponsorship programs, mentoring, hackathons, man-agement fights, case-championships, etc. It has been revealed that new professionals with technical skills can solve complex problems and generate products. But it’s difficult for them to dive into the banking sector, study its features and offer their own solutions to problems. It was also revealed that the company is interested in product results that are practice oriented. Com-bining product results and training is only possible by creating an environment in which they can discuss their ideas, find sup-port and implement them. As a result, a business process for the implementation of digital initiatives has been formed, a competi-tive analysis of its advantages and disadvantages over the tradi-tional approach to training has been conducted. strategies. The leading method of research is the definitions according grouping to the principles of the matrix method. It was revealed that the economic security concept is disclosed using factors freely com-bined into three groups (includes: sustainability, protection of interests, ensuring sovereignty), and the most common definitions are built using words-markers: state, security, advantage, process. One of the main study results is an algorithm for constructing the definition of the economic security concept, which allows to model and refine the definition of the concept based on the initial categories, consider-ing the economic context. The author's definition is also formulated, which reflects the interrelation of such components as the protection of interests, the impact of threats, the stability preservation, inde-pendence, ensuring development, self-adaptation and self-reproduction.

Economic freedom, competition and bank stability in Sub-Saharan Africa

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Emmanuel Sarpong-Kumankoma ◽  
Joshua Yindenaba Abor ◽  
Anthony Q. Q. Aboagye ◽  
Mohammed Amidu
Keyword(s):  
Economic Freedom ◽  
Banking Sector ◽  
Generalized Method Of Moments ◽  
Sub Saharan Africa ◽  
Bank Stability ◽  
Content Type ◽  
Show Evidence ◽  
Negative Effect ◽  
Sub Saharan ◽  
The Stability

PurposeThis study aims to analyze the potential implications of economic freedom and competition for bank stability.Design/methodology/approachUsing system generalized method of moments and data from 139 banks across 11 Sub-Saharan African (SSA) countries during the period 2006–2012, this study considers whether the degree of economic freedom affects the relationship between competition and bank stability.FindingsThe results show evidence of the competition-fragility hypothesis in SSA banking, but suggests that beyond a setting threshold, increases in market power may also be damaging to bank stability. Financial freedom has a negative effect on bank stability, suggesting that banks operating in environments with greater financial freedom generally tend to be less stable or more risky. The authors also find evidence of a conditional effect of economic freedom on the competition–stability relationship, implying that bank failure is more likely to occur in countries with greater economic freedom, but with low competition in the banking sector.Practical implicationsThe results suggests to policy makers that a moderate level of competition and economic freedom may be the appropriate policy to ensure the stability of banks.Originality/valueThe study provides insight on the competition–bank stability relationship, by providing new empirical evidence on the effect of economic freedom, which has not been previously considered.

scholarly journals Panel modeling of z-score: evidence from Islamic and conventional Saudi banks

2019 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Hassan Belkacem Ghassan ◽  
Abdelkrim Ahmed Guendouz
Keyword(s):  
Financial Stability ◽  
Banking Sector ◽  
Stability Index ◽  
Z Score ◽  
Strong Concentration ◽  
Content Type ◽  
Quarterly Data ◽  
Annual Frequency ◽  
Conventional Banks ◽  
The Stability

Purpose This paper aims to measure the stability extent of the banking sector in Saudi Arabia, including Islamic and conventional banks (CBs), using quarterly data. Design/methodology/approach The paper uses seemingly unrelated regressions to estimate the determinants of the z-score. Findings The panel data model shows that Islamic banks (IBs) reduce the financial stability index relatively; meanwhile, they contribute efficiently to enhance the financial stability through the diversification of their assets. The Saudi banking sector exhibits strong concentration affecting the financial stability negatively. Research limitations/implications The paper’s topic can be extended to cover the recent period. Practical implications The limited presence of IBs in the Saudi banking sector jeopardizes any effort to improve the financial stability. Social implications By attracting more clients, IBs would contribute more to the financial stability in the Saudi economy. Also, the monetary authority has to expand the share of IBs in the financial system at least 50-50 compared to CBs. Originality/value The z-score is mostly analyzed with yearly data; in this paper we use quarterly data to describe at infra-annual frequency the variability of the z-score index. Also, we consider in detail the statistical properties of the banks’ data.

Interbank financing and business cycle in Europe

2019 ◽  
Vol 46 (6) ◽  
pp. 1280-1291 ◽  
Author(s):  
Ly Kim Cuong ◽  
Vo Xuan Vinh
Keyword(s):  
Business Cycle ◽  
Banking Sector ◽  
Financial Structure ◽  
Policy Makers ◽  
Content Type ◽  
Level Data ◽  
The Business Cycle ◽  
The Stability ◽  
Liquidity Shock

Purpose The knowledge of the link between interbank financing and business cycle fluctuations is important in assessing the stability and soundness of the banking sector. The purpose of this paper is to investigate the simultaneous relationship between interbank financing and the business cycle with respect to the financial structure of the bank-based and market-based systems in European countries by using bank-level data from 2007 to 2011. Design/methodology/approach The study employs an innovative instrumenting technique with an instrument of the financial structure to address the simultaneous determination of interbank financing and the business cycle. Findings The results suggest that banks establish pro-cyclical interbank borrowing by increasing their interbank position during booms and reducing it during downturns. Bank-based system performs better in redistributing the liquidity in the economy than the market-based system when there are imperfectly correlated liquidity shocks across regions during the 2007–2009 financial crisis. Practical implications The improvement of banks’ liquidity risk management should be aligned with a specific financial system. The macro-prudential supervisor should require banks in the market-based system to disclose their interbank position on the extent of risk exposure during the liquidity shock period to stabilize the EU banking industry. Originality/value This study is the first to provide policy makers with some novel empirical results concerning the linkage among bank liquidity, the macroeconomic condition and financial structure.

Abwicklung von Banken

2019 ◽  
Author(s):  
Robin Blaß
Keyword(s):  
Financial Distress ◽  
Banking Sector ◽  
The Other ◽  
Banking Union ◽  
Public Funds ◽  
Single Resolution Mechanism ◽  
European Banking ◽  
Public Money ◽  
The Stability ◽  
Insolvency Proceedings

In this book, the author concerns himself with the EU’s banking union, whose establishment aims to further integrate the European banking sector and strengthen confidence in its stability. He focuses on the Single Resolution Mechanism (SRM), which was established as the second pillar of the banking union. With the help of the SRM, it should be possible in the future for even large banks to be in financial distress without endangering the stability of the entire financial system. The bank will be liquidated in accordance with the rules of the SRM if traditional insolvency proceedings are not feasible due to the caesura effect associated with them. In addition, as little public money as possible—at best no public funds at all—is to be spent on the resolution. The main purpose of this study is to ascertain whether the SRM can achieve this objective and how the SRM and the other pillars of the banking union interact with each other.

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