scholarly journals The effect of income diversification on growth in the Turkish banking sector

Pressacademia ◽  
2021 ◽  
Vol 14 (1) ◽  
pp. 33-37
Author(s):  
Coskun Ataol
Keyword(s):  
Banking Sector ◽  
Income Diversification

scholarly journals Income Diversification in Low Income Sub-Saharan African Countries’ Commercial Banks: A “Blessing” or “Curse”?

2018 ◽  
Vol 18 (2) ◽  
pp. 90-105
Author(s):  
Odunayo Magret Olarewaju
Keyword(s):  
Financial Performance ◽  
Low Income ◽  
Commercial Banks ◽  
Banking Sector ◽  
Economic Trend ◽  
Low Income Countries ◽  
African Countries ◽  
Income Diversification ◽  
Operating Income ◽  
Interest Income

Abstract Dynamics in economic trend and banks’ creditors’ expectation have directed banks to search the innovative means of income generation. It is with this view that this study examines the relationship between the income diversification and financial performance of banks in SSA low income countries. A panel data of 1,280 observations were extracted from the financial profile of 160 commercial banks from 19 purposively selected countries from 2009 to 2016. The findings from the empirical analysis indicate that non-interest income accounts for 95% of operating income in Low Income countries’ commercial banking sector. Also, it was found that income diversification in SSA banks enhanced financial performance as affirmed by the finance theory because both interest and non-interest income sources are indeed blessings as they increase the financial performance significantly. Therefore, low income SSA countries’ commercial banks are urged to strive to ensure proper investment with their income diversification so that better performance of their economies is enhanced.

scholarly journals Risk-taking behavior, competition, diversification and performance of frontier and emerging economy banks

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Nicholas Addai Boamah ◽  
Augustine Boakye-Dankwa ◽  
Emmanuel Opoku
Keyword(s):  
Risk Taking ◽  
Banking Sector ◽  
Emerging Economy ◽  
The State ◽  
Bank Performance ◽  
Income Diversification ◽  
Content Type ◽  
Excessive Competition ◽  
State Of The Economy ◽  
Risk Taking Behavior

PurposeThe study examines the dynamic association between competition, risk-taking, performance and income diversification of frontier and emerging economy (FEE) banks. It additionally, explores the effect of banking sector depth and economic performance on the level of competition, performance and risk-taking behavior of banks in these economies.Design/methodology/approachThe paper adopts a panel vector auto-regressive technique and collects data across ninety (90) FEEs.FindingsThe paper finds that competition increases with improvement in the depth of the banking sector, a surge in risk-taking behavior and the adoption of focused strategy by banks. Similarly, income diversification activities are driven by competition, banking sector depth, the state of the economy and bank performance. Additionally, risk-taking behavior, banking sector depth and the state of the economy are relevant in describing bank performance. Also, risk-taking behavior is influenced by bank performance, banking sector depth and economic growth.Originality/valueThe evidence indicates that although competition improves banking sector health, excessive competition and non-competitive banking environment constrain banks’ performance and stability.

scholarly journals Determinants of non-performing loans in the banking sector in developing state

2020 ◽  
Vol 5 (1) ◽  
pp. 135-145 ◽  
Author(s):  
Muhammad Asif Khan ◽  
Asima Siddique ◽  
Zahid Sarwar
Keyword(s):  
Fixed Effects ◽  
Banking Sector ◽  
Developing Economies ◽  
Stock Exchange ◽  
Negative Association ◽  
Capital Adequacy ◽  
Operating Efficiency ◽  
Income Diversification ◽  
Content Type ◽  
The Stability

PurposeThe size of non-performing loans (NPLs) plays a key role in the stability of the banking sector of a country. The factors that explain the NPLs contain very important information for banks. Studies in this regard with respect to developing states such as Pakistan have received little attention. This study aimed to scrutinize the determinants of NPLs observing a case of the banking sector in Pakistan over the period from 2005 to 2017.Design/methodology/approachThe sample consists of the banking sector (i.e., commercial banks) listed in Pakistan Stock Exchange over the period of 2005–2017. The banking factors, including profitability, operating efficiency, capital adequacy and income diversification, were evaluated. The estimations were done by regression modeling using random and fixed effects through STATA software.FindingsResults show that the operating efficiency and profitability indicators have a negative association with NPLs but were statistically significant, while capital adequacy and income diversification have a negative association with NPLs but were statistically insignificant.Research limitations/implicationsThe present study has considered limited banking indicators as determinants of NPLs and was limited to a specific time period from 2005 to 2017.Originality/valueThe study is an attempt to investigate various banking factors that affect the NPLs with respect to developing economies such as Pakistan.

scholarly journals Effects of Income Diversification and Financial Performance of Kenyan Commercial Banks.

2021 ◽  
Vol 04 (08) ◽  
Author(s):  
Timothy Kipkogei Kiptum ◽  
Keyword(s):  
Financial Performance ◽  
Banking Sector ◽  
Income Diversification ◽  
Bank Profitability ◽  
Interest Income ◽  
Bank Managers ◽  
Effect Regression ◽  
Specific Factors ◽  
Motivating Factor ◽  
The Impact

This paper aims at examining the impact of income diversification on financial performance. The motivating factor is an occasion by raising pursuance of interest activities and fluctuations of profitability among banks due to the declining interest income and stiff competition. Design/methodology/approach – This study uses a sample of 31 Kenyan banks and data for the period 2008-2019. Data is analyzed through fixed-effect regression analysis. Findings – The study finds that income diversification improves bank profitability. The findings are attributable to an increase in non-interest income and possible risk diversification. Moreover, the study controls for several banking sector-specific factors that affect financial performance. The results show bank size, age, loan portfolio quality, lending strategy, and market share have a significant effect. Research implications – Based on the results, the study recommends that bank managers should consider engaging in non-traditional activities that generate non-interest income to compensate for deteriorating interest income and to boost performance. In addition, the study recommends that bank regulators should relax rules that limit the extent to which banks can engage in non-interest earning activities

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.

Optimum Structure of the Banking Market: How Many Banks Are Necessary for Russia?

2006 ◽  
pp. 75-92 ◽  
Author(s):  
S. Moiseev
Keyword(s):  
Banking Sector ◽  
Optimum Structure ◽  
Population Number ◽  
The Third ◽  
Banking Market ◽  
The World ◽  
The Usa ◽  
Per Capita ◽  
The Empirical Analysis ◽  
Equilibrium Number

The number of classical banks in the world has reduced. In the majority of countries the number of banks does not exceed 200. The uniqueness of the Russian banking sector is that in this respect it takes the third place in the world after the USA and Germany. The paper reviews the conclusions of the economic theory about the optimum structure of the banking market. The empirical analysis shows that the number of banks in a country is influenced by the size of its territory, population number and GDP per capita. Our econometric estimate is that the equilibrium number of banks in Russia should be in a range of 180-220 units.

Russian Banking Sector: Issues of Consolidation and Corporate Governance

2005 ◽  
pp. 65-75 ◽  
Author(s):  
A. Murychev
Keyword(s):  
Corporate Governance ◽  
Banking Sector ◽  
Competitive Advantages ◽  
Regional Banks

The article analyzes urgent issues of the development of Russian banks. The probability of Moscow banks' regional expansion is noted. Hence the necessity for regional banks to find market niches. Competitive advantages of small and medium-sized banks as well as barriers to their activity are considered. Special attention is paid to the problems of corporate governance in banks. The results of the survey conducted by the Association of Regional Banks of Russia in summer of 2004 are analyzed.

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