THE CURRENT STATE OF THE BANKING SYSTEM OF SAUDI ARABIA

2017 ◽  
Author(s):  
Maryna Korol ◽  
◽  
Olha Shumnegra ◽  
Keyword(s):  
Saudi Arabia ◽  
Financial Services ◽  
Banking Sector ◽  
Banking System ◽  
Scientific Publication ◽  
Islamic Banking ◽  
Historical Aspect ◽  
Current State ◽  
The Government ◽  
And Control

This scientific publication analyzes the current state of the banking system of the Kingdom of Saudi Arabia. The peculiarities of the functioning of the Islamic banking system, the main types of financial products provided by banks and the laws under which financial services are provided to Muslims are identified. The basic principles of Islamic banking, which are prescribed in the Sharia, are described, such as, for example, the exclusion of interest on all financial transactions. There is also a list of major Saudi banks and foreign affiliates operating in the country. The historical aspect of the formation of the banking sector is studied. The main financial indicators are analyzed: the dynamics of assets, liabilities, the number of loans to private and corporate clients, the share of Saudi assets in global Islamic finance. Attention is also paid to the prospects and success of the stock market. The issue of management and control over the activities of banks and its role are studied. a list of specialized credit institutions established by the government to provide highly specialized loans to citizens of the kingdom. The positive dynamics of all indicators even in the conditions of global crises, thanks to the well-laid foundation and the further strategy concerning functioning in the conditions of the world pandemic are allocated. The list of the main internal problems which can suspend growth in the future is considered. The issue of the country's dependence on oil prices, with further impact on financial diversification, is considered separately. The prospects of the banking system of Saudi Arabia in the near future, and the role of the Kingdom as a partner in financial relations for the domestic economy are determined. Conclusions are made on the basis of the conducted research and prospects of further strategic development in this direction.

scholarly journals Concentration and Competition in the Albanian Banking Sector

2015 ◽  
Vol 2 (1) ◽  
pp. 168 ◽  
Author(s):  
Eleana Lici ◽  
Irena Boboli
Keyword(s):  
Financial Services ◽  
Banking Sector ◽  
Market Competition ◽  
Banking System ◽  
External Financing ◽  
Low Level ◽  
Banking Market ◽  
The Government ◽  
High Level

Albania has a relatively new financial system, where banking system is the most developed financial service in our country, with a share of 94, 4% of the total financial services. This is a phenomenon of countries with emerging economies, which proves that there is greater reliance on the state economic development of the banking sector, by effecting from the households to the biggest investors and the government. As in any market, competition is important for the banking sector because, it affects the efficiency and the quality of services offered. Furthermore, competition in banking has also implications for other sectors of the economy. So, higher competition in the banking sector is found to be associated with a faster growth of other sectors of the economy that rely on external financing. The main goal of this paper is to understand the characteristics of competition in our banking system and study the relationship between the level of concentration and competition. We are going to measure the concentration by the “H” indices. The “H” (Herfindaflit) indices is a measure of the level of the concentration of the banking system of a country. A high level of the indices shows a high level of concentration and as a consequence a low level of competition. A low level of the indices shows a low level of concentration which is sign of a banking market with a high competition.

scholarly journals Presenting a Conceptual Model to Explain the Role of Strategic Management and Planning in Islamic Banking Competitiveness

2014 ◽  
Vol 37 ◽  
pp. 46-56
Author(s):  
Seyed Reza Seyed-Javadin ◽  
Reza Raei ◽  
Mohammad Javad Iravani ◽  
Mohammad Safari
Keyword(s):  
Strategic Management ◽  
Financial Services ◽  
Local Level ◽  
Banking System ◽  
Business Environment ◽  
Superior Performance ◽  
Islamic Banking ◽  
And Control

Financial system is the heart of any economy. To superior performance in the national and local level it is essential to have an efficient and convenient banking system. What this study aimed to discuss is that strategic management principles, content and benefits should be considered in order to achieve a higher successfulness in the Islamic banking planning, implementation and control. In today financial services market lack of strategic and long term visions and planning is one of the challenges and problems related to the Islamic banking. Thus this paper aimed at present the theoretical framework to illustrate the key role of strategic management and planning in the Islamic banking successful management and implementation. In order to present the framework this study using qualitative method, based on the detailed literature review and previous researches according to the identified models of both strategic management and competitive advantage final theoretical model has been provided. Strategic management with its unique features is primary designed to help the organization operate successfully in dynamic, complex environment especially in the financial and banking markets. Strategic management links the basic elements of an organization so integrated that breakthrough in turbulent business environment can be achieved.

Islamic Banking in Indonesia

2020 ◽  
pp. 38-60
Author(s):  
M. Luthfi Hamidi ◽  
Andrew C. Worthington
Keyword(s):  
Central Bank ◽  
Financial Services ◽  
Banking Sector ◽  
Islamic Banking ◽  
Credit Allocation ◽  
Banking Services ◽  
The Past ◽  
The Government ◽  
Market Pressures

The Indonesian banking sector has been stable and generally sound over the past decade, partly through efforts by the Bank of Indonesia as Indonesia's central bank and Otoritas Jasa Keuangan as its financial services regulator. This chapter identifies important issues that remain for both conventional and Islamic banking in Indonesia. Authors suggest the government continue its efforts to reform what remains a geographically concentrated industry, to increase the role of bank credit in the economy, and to widen the provision of banking services through technology. Authors highlight the vulnerability of smaller banks in Indonesia to ongoing competitive market pressures and the necessity of creating larger banks through merger or capital raising and improving credit allocation to small and medium-sized businesses. Islamic banking has an important role to play in these developments, and those relating to Islamic social banking.

Enhancing Islamic Banking and Finance in Southeast Asia Through the Application of Artificial Intelligence

2020 ◽  
pp. 36-53
Author(s):  
Nor Razinah Mohd. Zain ◽  
Rusni Hassan ◽  
Azman Ismail
Keyword(s):  
Artificial Intelligence ◽  
Southeast Asia ◽  
Financial Services ◽  
Banking Sector ◽  
Banking System ◽  
Islamic Banking ◽  
Financial Services Industry ◽  
Positive Trend ◽  
Banking And Finance ◽  
Services Industry

The disruption of innovations in the banking sector continues to indicate a positive trend among bankers and customers. The innovations of technology that stand with speediness and fast track transaction effectively support the spread in using banking system without barriers. Recently, the financial services industry continues to be surprised by the latest technology's innovation that is known as artificial intelligence. By looking into the ecosystem for the future sustainability of Islamic banking and finance in Southeast Asia, Islamic financial services may learn and adopt several best practices of A.I. from global banking practices. With a focus on the Islamic financial services industry in Southeast Asia, an exploration on the readiness of such industry and advantages of artificial intelligence are made. This research depends on the qualitative investigation from documentary materials. The leadership of Islamic banks shows their readiness in accepting artificial intelligence.

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.

Arah Kebijakan Pengawasan terhadap Perbankan Syariah dalam Sistem Perbankan Nasional di Indonesia

2020 ◽  
Vol 3 (1) ◽  
pp. 41-52
Author(s):  
Andrew Shandy Utama
Keyword(s):  
Central Bank ◽  
Financial Services ◽  
Banking System ◽  
Islamic Banking ◽  
Legal Research ◽  
Islamic Bank ◽  
Independent Direction ◽  
National Banking System

This research aims to explain the direction of policy regarding supervision of Islamic banking in the banking system in Indonesia. The method used in this research is normative legal research using the statutory approach. The results of this research explain that the policy regarding supervision of Islamic banking in the national banking system in Indonesia is headed toward an independent direction. In Law Number 7 of 1992 and Law Number 10 of 1998, it is stated that supervision of Islamic banking is done by Bank Indonesia as the central bank. Based on Law Number 21 of 2008, supervision of Islamic banking is strengthened by not only being supervised by Bank Indonesia, but also by the National Sharia Council of the Majelis Ulama Indonesia by placing Sharia Supervisory Councils in each Islamic bank. After the ratification of Law Number 21 of 2011, supervision of Islamic banking moved from Bank Indonesia to an independent institution called the Financial Services Authority.

scholarly journals Demonetisation Impact over Banking Loans & Advances: A Case Study

2019 ◽  
Vol 7 (4) ◽  
pp. 51-64
Author(s):  
Narsaiah Neralla
Keyword(s):  
Financial Services ◽  
Banking Sector ◽  
Study Data ◽  
Ecosystem Dynamics ◽  
Banking Services ◽  
Legal Tender ◽  
The Status ◽  
The Government ◽  
Case Study Data

The demonetisation footstep by the Government of India twisted complicated influences in the economy. Complete sectors of the economy had faced and produced mixed sensation results over the decision of demonetisation. India’s financial services struggled with demonetisation; on the other hand demonetisation affects utmost over the banking sector because it is substantial influenced services to transform money circulation in an Indian economy. Eradicating components of currency notes from circulation in an economy is demonetisation. It is as the processes of components of money are denied the status of legal tender. Consequently, ceased currency notes will not be account as valid currency in an economy. The term ‘demonetization’ is an instrument to shrink Inflation, Black Money, Corruption and terror funding, this step discourages a cash dependent economy in India. Government of India drive towards demonetisation has given a strong push to the popularity of digital banking and made helps with the alternative arrangements of e-banking and e –wallet to trade and commerce. Exploring the demonetisation emergence in an economy and impact on banking services ecosystem dynamics, this study take an abductive approach anchored in over 4 years of case study data regarding. The present study foremost intention is to be analysing the demonetisation impact over banking loans and advances. In this regard the present study is to be examining the pre demonetisation and post demonetisation period.

scholarly journals Analysis of The Influence of Liquidity, Credit and Operational Risk, in Indonesian Islamic Bank’s Financing for The Period 2007-2013

2015 ◽  
Vol 17 (3) ◽  
pp. 279 ◽  
Author(s):  
Ousmane Diallo ◽  
Tettet Fitrijanti ◽  
Nanny Dewi Tanzil
Keyword(s):  
Credit Risk ◽  
Causal Relationship ◽  
Risk Sharing ◽  
Banking Sector ◽  
Panel Data Analysis ◽  
Banking System ◽  
Liquidity Risk ◽  
Operational Risk ◽  
Islamic Banking ◽  
Islamic Bank

The purpose of this paper is to analyze the influence of credit, liquidity and operational risks in six Indonesian’s islamic banking financing products namely mudharabah, musyarakah, murabahah, istishna, ijarah and qardh, in order to try to discover whether or not Indonesian islamic banking is based on the “risk-sharing” system. This paper relies on a fixed effect model test based on the panel data analysis method, focusing on the period from 2007 to 2013. The research is an exploratory and descriptive study of all the Indonesian islamic banks that were operating in 2013. The results of this study show that the Islamic banking system in Indonesia truly has banking products based on “risk-sharing.” We found out that credit, operational and liquidity risks as a whole, have significant influence on mudarabah, musyarakah, murabahah, istishna, ijarah and qardh based financing. There is a correlation between the credit risk and mudarabah based financing, and no causal relationship between the credit risk and musharaka, murabahah, ijarah, istishna and qardh based financing. There is also correlation between the operational risk and mudarabah and murabahah based financing, and no causal relationship between the operational risk and musharaka, istishna, ijarah and qardh based financing. There is correlation between the liquidity risk and istishna based financing, and no causal relationship between the liquidity risk and musharaka, mudarabah, murabahah, ijarah and qardh based financing. A major implication of this study is the fact that there is no causal relationship between the credit risk and musharakah based financing, which is the mode of financing where the islamic bank shares the risk with its clients, but there is an influence of credit risk toward mudarabah mode financing, a financing mode where the Islamic bank bears all the risk. These findings can lead us to conclude that the Indonesian Islamic banking sector is based on the “risk sharing” system.

scholarly journals Too Much Technology and Too Little Regulation? The Spectacular Demise of P2P Lending in China

2021 ◽  
Vol 0 (0) ◽  
Author(s):  
Ding Chen ◽  
Simon Deakin ◽  
Andrew Johnston ◽  
Boya Wang
Keyword(s):  
Banking Sector ◽  
Central Government ◽  
Focal Point ◽  
Banking System ◽  
Internal Controls ◽  
Banking Activity ◽  
P2p Lending ◽  
Fundamental Uncertainty ◽  
The Government ◽  
Specific Regulation

Abstract In this paper we trace the rapid growth and spectacular demise of online peer to peer lending in China. Drawing on a series of interviews conducted in China in 2017 and 2018, we follow the expansion of the sector from the establishment of the first major platform in 2007, through the introduction of limited regulation in 2015 in response to a series of platform failures to the final de facto closure of the whole sector by the regulator in 2019–20. However, contrary to claims that technology would reduce risk, the new platforms appear to have given rise to new risks by connecting dispersed borrowers and lenders whilst the regulator had decided to leave the sector to evolve without specific regulation. While there were hopes that P2P lending might increase flows of finance to the SMEs that are excluded from the formal banking system, ultimately too much of the activity on the P2P platforms was characterised by what we term ‘transactional ambiguity’ and ‘legal fluidity’: it occurred on the fringes of legality, often amounting to Ponzi schemes, fraud or unlicensed banking activity. In contrast to the banking sector, where their intermediation role ensures that banks are the focal point in the event of borrower default, and conventional moneylending, where moneylenders bear the risk of default, defaults and platform failures in the P2P sector distributed losses far and wide around the country, often to lenders who were not capable of bearing them. Whilst the central government did not formally stand behind the P2P sector (as it does with banks because of the systemic implications of their operations), the government could not help but become involved where P2P lending transmitted losses to lenders who were dispersed around the whole country. Ultimately, central government announced a wholesale reversal of policy that led to the sector effectively being closed down. The episode cautions against overly optimistic claims that technology can eradicate the risks of fraud and fundamental uncertainty inherent in lending, and reminds us that, without appropriate regulation and adequate internal controls, financial institutions will always operate in ways that result in instability.

scholarly journals DEFIBRILLATORS OF EXPECTED MINES IN THE DEVELOPMENT OF THE BANKING SYSTEM OF UKRAINE: LESSONS OF THE CRISIS

2019 ◽  
pp. 26-36
Author(s):  
Bohdan LUTSIV
Keyword(s):  
Monetary Policy ◽  
Banking Sector ◽  
Internal State ◽  
Substantial Reduction ◽  
Banking System ◽  
Significant Deterioration ◽  
Policy Paradigm ◽  
Loan Portfolios ◽  
National Bank ◽  
The Government

Introduction. The effective functioning of the banking system determines the stability of the monetary market in the country. Stability and transparency of functioning and effective management are a guarantee of growth of deposits and attractiveness for investors. However, in recent years, the Ukrainian banking system is in a state of recession and does not fulfil the functions assigned to it. This led to the need for a so-called “purge” of the banking system and led to significant losses for both banks and for all the country’s economists. The instability that resulted from the crisis has caused even more distrust from people to banks. The main problems of the banking system of Ukraine in recent years is the curtailment of lending, a significant deterioration in the quality of loan portfolios, the reduction of its own capital and loss-making activity. Purpose. There is an analysis of the current post-crisis situation and expectations of changes in the development of the banking system of Ukraine in accordance with the new monetary policy paradigm. Results. The last economic crisis (2014–2015) is not generated by the banking system itself, but rather by economical quality. The policy of the Government and the monetary policy of the National Bank of Ukraine. Ukrainian banks are heavy and burdened with a large share of unprofitable loans, and the banking system itself is highly concentrated but not sufficiently consolidated. At the beginning of the crisis, the state of the banking sector was characterized by fictitious capitalization of banks, the involvement of the business of its shareholders, the with drawal of regulator refinancing, huge volumes of “garbage” securities in bank portfolios, etc. The National Bank of Ukraine has resorted to a “purge” of the banking system, in which the subjectivity and opacity appeared. The whole burden of reimbursing the costs associated with the withdrawal from the market of bankrupt banks took upon itself the fund for guaranteeing deposits of individuals. The influence of state banks on the general state of banking sector reform and ways to improve corporate governance in state banks is shown. The so-called defibrillators of changes which are expected in the near future in development of the banking system of Ukraine are defined. Conclusions. At present, the banking system of Ukraine demonstrates the following key trends: the end of the “bankruptcy” period; the problem of improvement of loan portfolios and optimization of operations with the bonds of an internal state loan is acute; the need for a substantial reduction of state participation in the banking system.

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