scholarly journals Navigating the financial crisis in Helvetic Waters: An analysis of the banking sector (2007-09)

2011 ◽  
Vol 1 (2) ◽  
pp. 65-78
Author(s):  
Elisabeth Paulet ◽  
Francesc Relano
Keyword(s):  
Financial Crisis ◽  
Business Model ◽  
Financial Institutions ◽  
Banking Sector ◽  
Balance Sheet ◽  
Banking System ◽  
Characteristic Structure ◽  
International Banks ◽  
Business Approach ◽  
Domestic Banks

As has been argued throughout this paper, the different way in which banks have been affected by the crisis is closely linked to their distinct business model. Consequently, the characteristic structure of the balance sheet in big banks and ethical banks is correlated with their divergent dynamic during the crisis. While the financial turmoil has left the business approach of ethical banks unchanged, as evidenced in the striking stability of their balance sheet from 2007 to 2009, the pattern shown by big banks has substantially changed over this same period. These developments would tend to suggest the need to reform the business model of big banks. There is no clear empirical evidence that a banking system with a large number of small institutions would be any more stable than the system as it currently stands. Besides, financing certain big projects would always require the existence of large international banks. Both types of financial institutions are in fact complementary. How to regulate the banking and financial sector is thus a complex and multifaceted issue. One cannot impose the same requirements on big international-oriented banks and small domestic banks. As this paper has tried to demonstrate, both have a distinct business model.

scholarly journals The role of the risk control function under the Basel II framework

2011 ◽  
Vol 1 (3) ◽  
pp. 40-49 ◽  
Author(s):  
Thomas Dietz
Keyword(s):  
Business Model ◽  
Control Function ◽  
Risk Control ◽  
Balance Sheet ◽  
Banking System ◽  
International Banks ◽  
Business Approach ◽  
Deutsche Bundesbank ◽  
Domestic Banks

While the financial turmoil has left the business approach of ethical banks unchanged, as evidenced in the striking stability of their balance sheet from 2007 to 2009, the pattern shown by big banks has substantially changed over this same period. These developments would tend to suggest the need to reform the business model of big banks. There is no clear empirical evidence that a banking system with a large number of small institutions would be any more stable than the system as it currently stands. Besides, financing certain big projects would always require the existence of large international banks. Both types of financial institutions are in fact complementary. How to regulate the banking and financial sector is thus a complex and multifaceted issue. One cannot impose the same requirements on big international-oriented banks and small domestic banks. As this paper has tried to demonstrate, both have a distinct business model. The following statements and assessments represent the author’s opinion only. They should not be interpreted as official statements or assessments from Deutsche Bundesbank.

Bank Capital Requirements after the Financial Crisis

2019 ◽  
pp. 706-735
Author(s):  
Mark E. Van Der Weide ◽  
Jeffrey Y. Zhang
Keyword(s):  
Financial Crisis ◽  
Structural Changes ◽  
Banking Sector ◽  
Balance Sheet ◽  
Banking System ◽  
Capital Requirements ◽  
Bank Capital ◽  
Regulatory Capital ◽  
Stress Tests ◽  
Global Banking

Regulators responded with an array of strategies to shore up weaknesses exposed by the 2008 financial crisis. This chapter focuses on reforms to bank capital regulation. We first discuss the ways in which the post-crisis Basel III reforms recalibrated the existing framework by improving the quality of capital, increasing the quantity of capital, and improving the calculation of risk weights. We then shift to the major structural changes in the regulatory capital framework—capital buffers on top of the minimum requirements; a leverage ratio that explicitly accounts for off-balance-sheet exposures; risk-based and leverage capital surcharges on the largest banks; bail-in debt to facilitate orderly resolution; and forward-looking stress tests. We conclude with a quantitative assessment of the evolution of capital in the global banking system and in the US banking sector.

scholarly journals PENERAPAN PERMODALAN BASEL III DAN IMPLIKASINYA TERHADAP KINERJA PERBANKAN DI INDONESIA

2019 ◽  
Author(s):  
Komang Agus Rudi Indra Laksmana
Keyword(s):  
Financial Crisis ◽  
Impact Analysis ◽  
Banking Sector ◽  
Global Financial Crisis ◽  
Balance Sheet ◽  
Banking System ◽  
Capital Adequacy ◽  
Basel Iii ◽  
Negative Effect ◽  
The Global Financial Crisis

The global financial crisis that occurred in 2007/2008 has encouraged state leaders who are membersof the G-20 to declare international efforts aimed at increasing transparency, accountability and regulation ofthe financial sector through strengthening the quantity and quality of the banking sector capital. This was basedon the occurrence of the global financial crisis in 2008, one of which was caused by the excessive level of leveragein the banking system both for the position recorded on the balance sheet (on-balance sheet) and inadministrative accounts (off-balance sheet). The final results of the recommendations are thenissued by Basel III:A global regulatory framework for more resilient banks andbanking systems on December 2010. In general, theBasel III agreement has threemain components, namely capital, liquidity and leverage ratio. The applicationofBasel III capital has an impact that will vary in various countries depending onthe number of exposures affected.This study conducted an impact analysis on theperformance of Basel III capital towards the performance of banksin Indonesiaduring the period of 2018 based on capital adequacy (CAR), and on the liquidity(NSFR, LCR) on growthin profitability (ROA). The study involved 11 banks withthe largest assets in Indonesia in 2018. The results showedthat CAR had asignificant negative effect on ROA, while the NSFR had a significant positiveeffect on ROA,and LCR had a significant negative effect on ROA. This study waslimited in terms of the number of samples anddata used, therefore furtherresearch is expected to increase the amount of data and samples and researchvariables.Keyword: Basel III; CAR; LCR

scholarly journals Banking operations as an object of administrative and legal protection

2018 ◽  
Vol 81 (2) ◽  
pp. 28-37
Author(s):  
M. Y. Bukreev
Keyword(s):  
Financial Institutions ◽  
Banking Sector ◽  
Banking System ◽  
Legal Protection ◽  
Legal Regulation ◽  
Practical Significance ◽  
Legal Norms ◽  
The Past ◽  
The Subject ◽  
Banking Operations

The subject matter of the research is the relations that are formed in the process of banking operations. It has been substantiated that banks and the banking system are among the most important financial institutions, which proper and stable functioning influences on all other spheres of life in the state. It is proved by the consequences of crises in the banking sector that have occurred in Ukraine over the past few years. Awareness of the importance of this area and the possible consequences of unlawful encroachments have determined the need to search for all legal means for combating delicts in the sphere of banking operations. Understanding the fact that one can achieve significant results in the sphere of protecting banking operations by administrative and legal means, has necessitated this scientific study. In order to analyze banking operations as an object of administrative and legal protection, the author has fulfilled the following tasks. The author has highlighted the use of the concepts of “protection” and “administrative and legal protection” in the context of their implementation in relation to banking operations. The foundations of Ukrainian and international administrative and legal regulation of protecting relations in the sphere of banking operations have been revealed. The essence and features of banking operations influencing the understanding of the sphere of protected relations have been outlined; and the content of administrative and legal protection of relations in the field of banking operations has been revealed. It has been noted that there is an extensive system of banking legislation on legal norms in Ukraine regulating banking operations that require legal protection. The practical significance of the obtained results of the article is determined by the substantiated provisions for improving the approaches to increase the efficiency of the administrative and legal protection of the relations in the sphere of banking operations. A number of practical results of the research can be used while studying administrative and legal means of protecting relations in the field of banking operations.

scholarly journals Fiscal Policy in a Financial Crisis: Standard Policy versus Bank Rescue Measures

2012 ◽  
Vol 102 (3) ◽  
pp. 77-81 ◽  
Author(s):  
Robert Kollmann ◽  
Werner Roeger ◽  
Jan in't Veld
Keyword(s):  
Fiscal Policy ◽  
Financial Crisis ◽  
Banking Sector ◽  
Banking System ◽  
State Aid ◽  
Government Support ◽  
Real Activity ◽  
Government Purchases ◽  
Macroeconomic Effects ◽  
Positive Effect

A key dimension of fiscal policy during the financial crisis was massive government support for the banking system. The macroeconomic effects of that support have, so far, received little attention in the literature. This paper fills this gap, using a quantitative dynamic model with a banking sector. Our results suggest that state aid for banks may have a strong positive effect on real activity. Bank state aid multipliers are in the same range as conventional fiscal spending multipliers. Support for banks has a positive effect on investment, while a rise in government purchases crowds out investment.

Global Financial Crisis and Bank Productivity in Mexico

2015 ◽  
pp. 581-599
Author(s):  
Francisco Vargas Serrano ◽  
Luis Rentería Guerrero ◽  
Gang Cheng ◽  
Panagiotis D. Zervopoulos ◽  
Arnulfo Castellanos Moreno
Keyword(s):  
Financial Crisis ◽  
Banking Sector ◽  
Global Financial Crisis ◽  
Malmquist Index ◽  
Data Envelopment ◽  
Significant Difference ◽  
Before And After ◽  
Domestic Banks ◽  
Productivity Indicators ◽  
The Global Financial Crisis

This chapter presents an attempt to compare the productivity of the Mexican banking sector in two different periods: the 2007-2011 period of global financial crisis and the 2003-2006 stage, which can be regarded as a relatively stable period. The purpose of this study is to disclose whether the global financial crisis affected Mexican banking productivity. Three Data Envelopment Models (DEA) are tested in order to assess whether there is a significant difference between the productivity patterns of Mexican banks before and after the financial crisis. Such models are the radial Malmquist Index, the non-radial and slacks-based model, and non-radial and non-oriented. Essentially, no significant difference of productivity indicators for both foreign and domestic banks was found. Likewise, no significant difference between the pre- and post-crisis periods was perceived, as far as productivity indicators are concerned. Therefore, the global financial crisis was effectless in banking operation.

Impact of financial liquidity and solvency on cost efficiency: evidence from US banking system

2020 ◽  
Vol 37 (2) ◽  
pp. 391-410
Author(s):  
Kekoura Sakouvogui ◽  
Saleem Shaik
Keyword(s):  
Financial Crisis ◽  
Cost Efficiency ◽  
Stochastic Frontier Analysis ◽  
Banking System ◽  
Tobit Regression ◽  
Content Type ◽  
Frontier Analysis ◽  
Financial Liquidity ◽  
Domestic Banks ◽  
The Cost

Purpose The purpose of this paper is to evaluate the importance of financial liquidity and solvency on US commercial and domestic banks’ cost efficiency while accounting for internal and external factors. Design/methodology/approach The Stochastic Frontier Analysis and Data Envelopment Analysis estimators are used to estimate the cost efficiency of 11,044  US commercial and domestic banks from 2005 to 2017. Using Tobit regression model, the importance of financial liquidity and solvency on cost efficiency is examined. Findings The results provide evidence that the financial liquidity and solvency negatively impact the cost efficiency of US commercial and domestic banks. Overall, US commercial and domestic banks were inefficient during the financial crisis in comparison to the tranquil period. The importance of financial solvency on the cost efficiency was not statistically significant, while the financial liquidity negatively collapsed because of contagion. Finally, the results provide evidence that the amount of total assets matters in the improvement of the cost efficiency. Originality/value This paper estimates and identifies the 2007-2009 financial crisis with liquidity, solvency or both financial factors.

scholarly journals BANKING SECTOR MODERNIZATION(SPANISH RECIPE)

2017 ◽  
pp. 47-54
Author(s):  
Timofey Malashenko
Keyword(s):  
Financial Crisis ◽  
Economic Crisis ◽  
National Economy ◽  
Banking Sector ◽  
Banking System ◽  
Crisis Period

The aim of the research is to analyze transformation of the Spanish banking sector after the financial crisis of the year 2008. The author examines a hypothesis that banking system played an important role in the development of Spain’s economy. Spain’s banking sector was substantially transformed during the economic crisis, and now serves as a prerequisite for development of Spain’s national economy during post crisis period

scholarly journals BANKS OF THE CASPIAN REGION COUNTRIES IN THE BANKING SYSTEM OF RUSSIA: CURRENT TRENDS AND DEVELOPMENT PROBLEMS

2019 ◽  
Vol 8 (3) ◽  
pp. 7-28
Author(s):  
Olga Viktorovna Bogacheva ◽  
Oleg Alekseevich Lepekhin
Keyword(s):  
Global Economy ◽  
Banking Sector ◽  
Balance Sheet ◽  
Banking System ◽  
Operating Efficiency ◽  
Caspian Region ◽  
Banking Systems ◽  
Internalization Process ◽  
Business Entities ◽  
Credit Institutions

The mutual penetration of capital from one country into another has become a characteristic feature of the world financial system. This is largely due to the current globalization processes in the global economy, the continuous development of banking technologies, the need to maintain foreign economic activity of business entities and the rationale for expanding the scales of business activity as a tool to increase operating efficiency. The purpose of the article is to study the current internalization process in the banking systems of the Caspian region countries in terms of the penetration of the banks from the Caspian region countries into the Russian banking sector. Methodology. We have identified the sample of the Russian credit institutions fully controlled by the shareholders from the Caspian region states. Using the data, presented in turnover balance reports (Form 101), we have calculated key performance indicators in 2015–2018. We used the Bank of Russia’s practice to estimate the aggregate balance sheet of the 30 largest credit institutions as the basis for our algorithm. We have analyzed tendencies in funding base, structure of assets and operating efficiency. Results. The analysis of the financial statements shows that within the chosen business model, the banks of the sample are more likely to focus on international financial settlements, servicing foreign trade transactions, than on traditional types of banking business such as lending to non-financial enterprises and individuals. Their performance is significantly lower than the industry benchmarks, which so far does not allow us to expect an increase in their scale of presence in the Russian market in the near future. Practical implications. The analysis of current processes in the field of internationalization of banking systems can be used to assess the financial and economic integration of the countries of the Caspian countries and to develop corrective measures aimed at its further development and deepening.

scholarly journals Appraisal of Financial Situation of the Polish Banking Sector from 2008 to 2012

Management ◽  
2013 ◽  
Vol 17 (2) ◽  
pp. 177-189
Author(s):  
Paweł Trippner
Keyword(s):  
Economic Development ◽  
Financial Markets ◽  
Financial Institutions ◽  
Banking Sector ◽  
Banking System ◽  
Financial System ◽  
The European Union ◽  
Financial Situation ◽  
Financial Condition ◽  
European Union Countries

Summary Appraisal of Financial Situation of the Polish Banking Sector from 2008 to 2012 The banking system is a very important element of the financial system of a country. As institutions of public trust, banks play a crucial role in the process of transforming savings into investments, which directly affects the country’s economic development. Maintaining the banking sector in a good financial condition guarantees stability of the financial system and economic development of Poland. The article aims to present the essence of operations of banks as financial institutions, present their role in the economy, and describe various methods of appraising their financial condition. In order to fulfil the above goals, a research hypothesis is put forward stating that the financial condition of the banking sector in Poland deteriorated in the analysed period as a result of an adverse impact of turbulence in financial markets and problems in banking sectors in the European Union countries.

Sign in / Sign up

Export Citation Format

Share Document