PESTEL Analysis-Based Evaluation of Marketing Strategies in the European Banking Sector

2020 ◽  
pp. 429-448
Author(s):  
Hasan Dinçer ◽  
Fatih Pınarbaşı
Keyword(s):  
Interest Rates ◽  
Banking Sector ◽  
Technological Development ◽  
Marketing Strategies ◽  
Strategy Development ◽  
Fuzzy Dematel ◽  
European Banking ◽  
European Banks ◽  
The Interest Rate ◽  
Interval Type

This chapter evaluates the marketing strategies in European banking sector. In this context, six dimensions of PESTEL analysis (politic, economic, sociological, technologic, environmental, and legal) are taken into the consideration. On the other side, interval type-2 fuzzy DEMATEL approach is used to weight the importance of these dimensions. The findings show that technological and political factors have the highest importance. Therefore, it is recommended that technological innovations in the banking sector should be followed by European banks. Within this framework, these banks should design a market research department to follow these developments in the market so that new products and services can be identified. Therefore, technological development should be adopted in the strategy development process. In addition, interest rates defined by the central bank should also be considered by these banks. Hence, adopting marketing strategies according to the interest rate policy of the central banks provides a competitive advantage to the European banks.

scholarly journals What future for the European banking system?

2018 ◽  
Vol 87 (4) ◽  
pp. 141-151
Author(s):  
Lorenzo Bini Smaghi
Keyword(s):  
Interest Rates ◽  
Capital Market ◽  
Banking Sector ◽  
Banking System ◽  
The Us ◽  
Low Interest Rates ◽  
European Banking ◽  
European Banks ◽  
Main Factors

Zusammenfassung: Das Papier beleuchtet die Hauptgründe, die der sinkenden Rentabilität des europäischen Bankensektors im Vergleich zum US-amerikanischen zugrunde liegen. Sie unterstreicht insbesondere die Rolle niedriger Zinsen, geringerer Konzentration, strengerer Regulierung und des Fehlens eines tiefen und liquiden Kapitalmarktes. Ein stärkeres europäisches Bankensystem erfordert echte gesamteuropäische Banken und eine echte Kapitalmarktunion. Summary: The paper assesses the main factors underlying the decreasing profitability in the European banking sector, in comparison with the US. It underscores in particular the role of low interest rates, lower concentration,tighter regulation and the absence of a deep and liquid capital market. A stronger European banking system requires true pan-European banks and a true capital market union.

scholarly journals Who Bears Interest Rate Risk?

2018 ◽  
Vol 32 (8) ◽  
pp. 2921-2954 ◽  
Author(s):  
Peter Hoffmann ◽  
Sam Langfield ◽  
Federico Pierobon ◽  
Guillaume Vuillemey
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Banking Sector ◽  
Balance Sheet ◽  
Interest Rate Risk ◽  
Cross Sectional ◽  
Net Worth ◽  
Loan Rate ◽  
Rate Risk ◽  
European Banking

Abstract We study the allocation of interest rate risk within the European banking sector using novel data. Banks’ exposure to interest rate risk is small on aggregate, but heterogeneous in the cross-section. Contrary to conventional wisdom, net worth is increasing in interest rates for approximately half of the institutions in our sample. Cross-sectional variation in banks’ exposures is driven by cross-country differences in loan-rate fixation conventions for mortgages. Banks use derivatives to partially hedge on-balance-sheet exposures. Residual exposures imply that changes in interest rates have redistributive effects within the banking sector. Received October 31, 2017; editorial decision August 30, 2018 by Editor Philip Strahan. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

scholarly journals Does It Pay to Be Sustainable? Evidence from European Banks

2018 ◽  
Vol 14 (1) ◽  
pp. 128 ◽  
Author(s):  
Candida Bussoli ◽  
Danilo Conte ◽  
Graziana Letorri ◽  
Marco Barone
Keyword(s):  
Banking Sector ◽  
Corporate Social Performance ◽  
Social Performance ◽  
Return On Assets ◽  
Market Capitalization ◽  
Average Return ◽  
European Banking ◽  
Environmental Component ◽  
European Banks ◽  
Corporate Social

This paper aims to explore the relationship between the economic, environmental, social, and corporate governance component of Corporate Social Performance (CSP) and the Corporate Financial Performance (CFP) in the European banking sector. The empirical analyses, based on panel data, are performed on a sample of 70 listed European banks (EU28) over the period 2011-2015. The main results show a significant and positive relationship between the aggregated CSP measure and the average profitability of banks' assets and market capitalization. Furthermore, the social component positively affects the average return on assets and equity; the economic component is positively associated with the performance of prospective profitability and market capitalization; finally, the environmental component is positively associated with the ROAA. Sustainable banks, in line with the stakeholder Theory, through ethical and social policies, might increase their financial and economic performance.

scholarly journals THE DETERMINANTS OF INTEREST RATE SPREAD AMONG COMMERCIAL BANKS IN KENYA

2017 ◽  
Vol 2 (5) ◽  
pp. 29
Author(s):  
Leah Njoroge ◽  
Mercy Warui ◽  
Catherine Mbogo ◽  
Margaret Chiera ◽  
Dr. Chogii
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Market Structure ◽  
Significant Relationship ◽  
Commercial Banks ◽  
Banking Sector ◽  
Unique Contribution ◽  
High Interest Rate ◽  
Interest Rate Spread ◽  
The Interest Rate

Purpose: To establish the determinants of interest rate spread among commercial banks in Kenya. Methodology: The study utilized a descriptive survey research design. Findings: The results indicated that the commercial banking sector has witnessed a gradual rise in the Interest rate spread. Results also showed that the mean of market structure has been fluctuating with year (2010) being the lowest with mean of 4 and year (2012) being the highest with mean 12. Results also showed that there was no regulation from the year (2005) to the year (2009) but it was later adopted whereas regulations shoot steadily to mean of 1.0 in the year (2009) and remained in the same level the rest of the years. The regression results indicate that there is a positive and significant relationship between market structure, credit risk and interest spread. The regression results also indicated that there is a positive but insignificant relationship between access to information and interest spread. Further, the results indicated that there is a negative and significant relationship between regulation and interest spread. Unique contribution to theory, practice and policy: The study is important to the management of Commercial banks as it will provide an insight on the factors influencing interest rate spread among commercial banks in Kenya. The results of this study will provide information to policy makers and other stakeholders in the financial sector (especially the banks) to come up with strategies that help in dealing with the high interest rate spread experience in the banking sector and thus improve on the financial performance of the organisations. It may be used as a tool for persuading commercial banks to reduce their interest rates spread and hence increase their volume of business, which of course would compensate the loss in the interest rate spread. The study will also be invaluable to the government and CBK. This is because the monetary policy framework of Central Bank of Kenya and its implementation will be guided by a need to ensure, among others: realistic interest rate spreads that encourage financial deepening and a safe, sound, efficient and competitive banking system through discreet risk management. These findings therefore might influence the effectiveness of economic policies. The research results will also be important to scholars and researchers as it will add to the existing pool of knowledge.

Impact of Interest Rate Changes on the Profitability of four Major Commercial Banks in Pakistan

2014 ◽  
Vol 4 (1) ◽  
pp. 142 ◽  
Author(s):  
Waseem Ahmad Khan ◽  
Abdul Sattar
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Commercial Banks ◽  
Banking Sector ◽  
Pearson Correlation ◽  
Correlation Method ◽  
Economic Stability ◽  
Independent Variable ◽  
The Interest Rate ◽  
The Impact

The core objective of this project is to analyze the impact of interest rates changes on the profitability of commercial banks being operated in Pakistan by examining the financial statements of four major banks during 2008 to 2012. Like the efficiency of banking sector is considered most important for economic growth, monetary policy implementation and macro-economic stability. From the past few years, interest spread of banking sector of Pakistan is rising. As a result variations in the interest rate depress the savings and investment and on the other hand it increases the efficiency of banks’ lending. In this paper interest rate is an independent variable and bank profitability is a dependent variable. To examine the impact of interest rate changes on the profitability of commercial banks in Pakistan, Pearson correlation method is used in this study. As a result it is found that there is strong and positive correlation between interest rate and commercial banks’ profitability. It means if the value of interest rate is increases/decreases then as result value of banks’ profitability will also increases/decreases.

Money and Credit in the New Keynesian Model

2014 ◽  
Vol 65 (3) ◽  
Author(s):  
Sven Offick ◽  
Hans-Werner Wohltmann
Keyword(s):  
Interest Rate ◽  
Central Bank ◽  
Interest Rates ◽  
Banking Sector ◽  
New Keynesian ◽  
Credit Channel ◽  
New Keynesian Model ◽  
Static Approximation ◽  
Keynesian Model ◽  
The Interest Rate

AbstractThis paper integrates a money and credit market into a static approximation of the baseline New Keynesian model based on a money-and-credit-in-the-utility approach, in which real balances and borrowing contribute to the household’s utility. In this framework, the central bank has no direct control over the interest rate on bonds. Instead, the central bank’s instrument variables are the monetary base and the refinancing rate, i. e. the rate at which the central bank provides loans to the banking sector. Our approach gives rise to a credit channel, in which current and expected future interest rates on the bond and loan market directly affect current goods demand. The credit channel amplifies the output effects of isolated monetary disturbances. Taking changes in private (inflation and interest rate) expectations into account, we find that - contrarily to BERNANKE and BLINDER (1988) - the credit channel may also dampen the output effects of monetary disturbances. The expansionary effects of a monetary expansion may be substantially diminished if the monetary disturbance is accompanied by a contractionary credit shock. In a dynamic version of our model, in which expectations are formed endogenously, we find that the credit channel amplifies output responses.

The determinants of bank profitability: empirical evidence from European banking sector

2016 ◽  
Vol 14 (1) ◽  
pp. 86-115 ◽  
Author(s):  
Elisa Menicucci ◽  
Guido Paolucci
Keyword(s):  
Banking Sector ◽  
Developed Countries ◽  
Policy Implications ◽  
Loan Loss ◽  
Data Set ◽  
Bank Profitability ◽  
Content Type ◽  
Loan Loss Provisions ◽  
European Banking ◽  
European Banks

Purpose The purpose of this paper is to investigate the relationship between bank-specific characteristics and profitability in European banking sector to find the role of internal factors in achieving high profitability. Design/methodology/approach A regression analysis is built on an unbalanced panel data set comprising 175 observations of 35 top European banks over the period 2009-2013. To this end, the empirical data are collected from Bankscope and a comprehensive set of internal characteristics is examined. Findings All the determinant variables included in the model have statistically significant impacts on European banks’ profitability. However, the effects are not uniform across profitability measures. Regression findings reveal that size and capital ratio are significant company-level determinants of bank profitability in Europe, while higher loan loss provisions result in lower profitability levels. Findings also suggest that banks with higher deposits and loans ratio tend to be more profitable but the effects on profitability are statistically insignificant in some cases. Practical implications This study has considerable policy implications, as the performance of the European banking sector depends on its efficiency, profitability and competitiveness. In view of these findings, some suggestions may be functional for bank regulatory authorities to intensify and sustain robustness and stability of the banking sector. Originality/value The results provide interesting insights into the characteristics and practices of profitable banks in Europe. Few econometric studies have empirically explored the determinants of bank profitability in Europe so far, even though similar studies have been conducted in several developed countries. Therefore, this paper tries to close an important gap in the existing literature improving the understanding of bank profitability in Europe.

scholarly journals Marketing Strategy Analysis In PT Bankaltimtara Tenggarong

2021 ◽  
Vol 21 (1) ◽  
pp. 118-128
Author(s):  
Suhardi Suhardi ◽  
Idham Idham
Keyword(s):  
Interest Rates ◽  
Customer Loyalty ◽  
Banking Sector ◽  
Swot Analysis ◽  
External Environment ◽  
Marketing Strategies ◽  
Strategy Analysis ◽  
The Public ◽  
The Right ◽  
The Impact

Abstract: The purpose of this research is to see the right strategy to be applied at PT. Bankaltimtara Tenggarong based on  SWOT analysis. The impact of the global economic crisis, which attacks the banking sector.  that some of banks experience enough problems such as customer savings to become unsecured, resulting in public distrust of the bank for their savings guarantee. Another impact is that the amount of funds that can be collected from the public to the bank is decreasing, so that the bank finds it difficult to turn its cash flow, and various other impacts. internal sample of 63 people and external as many as 74 customers. Data that can be analyzed using theoretical basics, namely SWOT analysis to identify the strengths and weaknesses of PT. Bankaltimtara Tenggarong and identify factors of opportunities and threats that come from the external environment. Based on the SWOT analysis conducted, PT Bank Kaltimtara can obtain several marketing strategies, namely: Increasing various types of competitive banking products. a). Increase customer loyalty and expand services to remote villages. b) Increase promotion to be known to remote villages. c) Focus on BUMDes and SMEs targets. d). Implement an attractive savings interest rate strategy and low credit interest rates.   Keyword :  Marketing Strategic

Sign in / Sign up

Export Citation Format

Share Document