scholarly journals The Politics of Financial Control and Reform in Korea

1991 ◽  
Vol 6 (0) ◽  
pp. 41-73
Author(s):  
ByungSun Choi
Keyword(s):  
Interest Rate ◽  
Industrial Policy ◽  
Commercial Banks ◽  
Financial Liberalization ◽  
Economic Structure ◽  
Financial Control ◽  
Government Control ◽  
Financial Industry ◽  
Central Argument ◽  
The Government

Government control over finance has been a persistent feature of the politco-economic structure of Korea. This paper first seeks to explain the process in which the government's control over finance had intensified by the late 1970s. with a focus on particular episodes such as the dramatic interest rate reform in 1965, Emergency Decree in August 1972, and several recurring "restructuring (in effect, bail-outs)" attempts, and in relation to the changing industrialization strategy and the consequent relationship between the government and chaebol. And then it will review critically the financial liberalization policies in the 1980s: the privatization of commercial banks, the conflict between the banks and the non-bankfinancial intermediaries (NBFI's) in the process of the restructuring the financial industry, and the freeing of interest rate and to "policy funds." The central argument of this paper is that a considerable progress of financial liberalization notwithstanding, the financial system of Korea still serves as the fulcrum of Korean industrial policy and as a fundamental tool with which Korean policymakers can induce business cooperation and compliance.

Intervention by Outsiders: A Strategic Management Perspective on Government Industrial Policy

1993 ◽  
Vol 13 (1) ◽  
pp. 69-88 ◽  
Author(s):  
Romano Dyerson ◽  
Frank Mueller
Keyword(s):  
Public Policy ◽  
Strategic Management ◽  
Industrial Policy ◽  
Financial Control ◽  
Firm Level ◽  
Policy Makers ◽  
Management Perspective ◽  
British Experience ◽  
The Government

ABSTRACTAs the debate throughout the eighties has concluded, the efforts of governments to intervene at the firm level has largely been disappointing. Using two examples drawn from the British experience, Rover and Inmos, this paper offers an analysis as to why the Government has encountered difficulties when it has sought to intervene in a strategic fashion. Essentially, public policy makers lack adequate mechanisms to intervene effectively in technology-based companies. Locked out of the knowledge base of the firm, inappropriate financial control is imposed which reinforces the ‘outsider’ status of the Government. Having addressed the limitations of strategic intervention, the paper, drawing on the comparative experience of other countries, then goes on to address how this policy boundary might be pushed back in the long term.

scholarly journals COMMERCIAL BANKS AND THEIR EFFECT ON SMALL AND MEDIUM ENTERPRISES FINANCING IN RWANDA: A CASE STUDY OF KIGALI CITY AND SOUTHERN PROVINCE

AGROFOR ◽  
2021 ◽  
Vol 6 (1) ◽  
Author(s):  
Mutamuliza EULARIE ◽  
Giramata AURORE
Keyword(s):  
Financial Services ◽  
Commercial Banks ◽  
Small And Medium Enterprises ◽  
Financial Industry ◽  
Chi Square ◽  
Southern Province ◽  
Start Up ◽  
Chi Square Test ◽  
The Government ◽  
Medium Enterprises

Commercial Banks worldwide are identified to be one of the key players in the financial industry that have positively affected individuals involved in business, and the economy at large, through the functions they perform in the economy. However, inadequate financing in the activities of Small and Medium Enterprises (SMEs) is still the major constraint faced by people involved in business activities. Even though the Government of Rwanda has made effort to improve the accessibility to credit, entrepreneurs still have some challenges to access financial services in order to improve their businesses. The purpose of this research was to assess the contribution of commercial banks in financing SMEs in Rwanda. A sample of 60 SMEs was selected in Kigali and Southern Province of Rwanda. Data was collected from the respondents through a structured questionnaire. The collected data were analyzed using descriptive statistics such as frequencies and percentage distributions. A Pearson Chi-Square Test was used to analyze the relationship between commercial banks and SMEs in Rwanda. The results indicated that the main purposes of loan application were start-up capital, working capital and expansion of businesses. The results also revealed that there was positive relationship between commercial banks and SMEs in Rwanda. The results revealed as well, that commercial banks in Rwanda played a crucial role in contribution to SME’s economic development and small and medium entrepreneurs who got credit from commercial banks expanded their businesses and increased their income.

Financial Industry Under Entrepreneurial Ecosystem

2020 ◽  
pp. 132-147
Author(s):  
Xiaomin Du ◽  
Xiangxiang Lang
Keyword(s):  
Developing Countries ◽  
Interest Rates ◽  
Commercial Banks ◽  
Negative Impact ◽  
Bank Performance ◽  
Financial Industry ◽  
Banking Business ◽  
Internet Finance ◽  
The Government ◽  
New Policies

Due to the three functions of cost reduction, disintermediation, and information asymmetry, internet finance continues to impact the traditional banking business in the financial industry, posing a new competitive risk for commercial banks. In developing countries such as China, given the imperfect development of the financial market, the government needs to introduce a series of policies, but new policies will bring the risk of market uncertainty. Due to the double uncertainty of the market and the system in developing countries, commercial banks are caught between competitive and new policy risks. Therefore, exploring the impact of these two risks on the performance of commercial banks is very important to allow commercial banks to discern, resist, and respond to risks. This research uses the data of A-share listed banks for the past 10 years. Empirical research shows that internet finance and interest rate liberalization have a negative impact on bank performance. The liberalization of interest rates further increases the negative impact of internet finance on bank performance.

Bank Lending Margins in China and the Effects of the June 2012 Liberalization

2014 ◽  
Vol 05 (02) ◽  
pp. 1450003 ◽  
Author(s):  
Richard C. K. Burdekin ◽  
Ran Tao
Keyword(s):  
Interest Rate ◽  
Event Study ◽  
Commercial Banks ◽  
Financial Liberalization ◽  
Initial Response ◽  
Bank Lending ◽  
Profit Margins ◽  
Share Prices ◽  
Chinese Banks ◽  
First Time

Financial liberalization in China has begun to allow more flexibility in bank interest rate setting but may threaten bank profit margins. This paper documents the initial response to the June 2012 initiative that, for the first time, allowed Chinese banks to meaningfully depart from the benchmark rates laid down by the People's Bank. We use an event study to assess the initial effects on bank share prices and compare the response of the larger state-owned banks to the smaller commercial banks. We identify significant reactions in both the Shanghai and Hong Kong markets.

scholarly journals VARIABEL MAKRO EKONOMI DAN NON PERFORMING LOAN: BUKTI EMPIRIS DARI BANK UMUM DI INDONESIA

2017 ◽  
Vol 2 (1) ◽  
pp. 1-14
Author(s):  
Amri Amri ◽  
Rahma Harianti
Keyword(s):  
Economic Growth ◽  
Interest Rate ◽  
Significant Influence ◽  
Commercial Banks ◽  
Multiple Regression Model ◽  
Economic Policies ◽  
Macroeconomic Variables ◽  
Corruption Perception ◽  
The Government ◽  
The Interest Rate

This study is aimed at empirically explores the effect of macroeconomic variables i.e., economic growth, interest rate and the Corruption Perception Index (CPI) on the Non-Performing Loans (NPL) of the commercial banks in Indonesia. An annually data from the years 2003 to 2014 were analysed using the multiple regression model. The study documented that: (i) the economic growth has insignificant effect on the Non-Performing Loans (NPL); (ii) the CPI has a negative significant influence on the Non-Performing Loans; and (iii) the interest rate has a positive significant influence on the Non -Performing Loans (NPL). This findings implied that the central bank of Indonesia (Bank Indonesia) and the government should design together the economic policies and regulations that could prevent increasing in the Non-Performing Loans (NPL) of the commercial banks in the country.Penelitian ini bertujuan untuk mengeksplorasi pengaruh variabel makroekonomi yaitu pertumbuhan ekonomi, tingkat suku bunga dan Indeks Persepsi Korupsi (CPI) terhadapkredit macet (NPL) bank- bank komersial di Indonesia. Data yang digunakan adalah tahunan dari tahun 2003-2014 yang dianalisis menggunakan model regresi berganda. Hasil studi ini menunjukkan bahwa: (i) pertumbuhan ekonomi tidak memiliki pengaruh signifikan pada Kredit Macet; (ii) CPI memiliki pengaruh signifikan negatif pada Kredit Macet; dan (iii) tingkat suku bunga memiliki pengaruh signifikan positif terhadap Kredit Macet. Temuan ini menyiratkan bahwa bank sentral (Bank Indonesia) dan pemerintah harus merancang bersama-sama kebijakan ekonomi dan peraturan yang bisa mencegah peningkatan kredit macet bank-bank komersial di Indonesia.

Financial Liberalization and Tests of Capital Flow Mobility in Taiwan

2001 ◽  
Vol 04 (04) ◽  
pp. 427-461 ◽  
Author(s):  
Yin K. Wen
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Capital Mobility ◽  
Financial Liberalization ◽  
Capital Flow ◽  
Financial Policies ◽  
Interest Rate Parity ◽  
Rate Parity ◽  
Flow Mobility ◽  
The Government

Taiwan's financial policies played a vital role in promoting its relatively rapid post-war industrialization, a process that involved the use of different financial strategies to accommodate different stages of economic development. This paper aims to examine the process of Taiwan's financial liberalization and the relationship of this process to the opening up of Taiwan's capital account, which can be viewed as the last reform stage for the entire financial liberalization process. The first section briefly introduces the evolution of Taiwan's financial policies during different stages of development, giving primary focus to her efforts at financial liberalization starting in the 1980s. During this period, mid-1987, the time when Taiwan's government promulgated a new law to deregulate foreign exchange control, counts as a watershed for Taiwan's exchange rate market. The second section uses the conventional interest rate parity method to compare the extent of capital flow mobility before and after mid-1987. The results of the comparison show only a slight improvement in capital flow mobility after mid-1987. The author argues that the interest rate parity method may, for various reasons, be inadequate for testing capital mobility in Taiwan's case. Evidence, in the form of measures that the Taiwan's government has taken over time as described in the first section and Appendix, shows that Taiwan's financial markets have become increasingly open and more market-oriented as the financial liberalization process progresses. Although the government is still intervening in both interest rate and exchange rate markets, the trend is toward less intervention, except for a brief period during the 1998-99 Asian Financial Crisis. The final section presents a brief conclusion and directions for further research.

scholarly journals FASILITAS DISKONTO (DISCOUNT WINDOWS) SEBAGAI INSTRUMEN MONETER DITINJAU DALAM PERSPEKTIF EKONOMI ISLAM

2019 ◽  
Vol 4 (1) ◽  
pp. 71
Author(s):  
RINA EL MAZA ◽  
EGI PUTRA SETIAWAN
Keyword(s):  
Interest Rate ◽  
Central Bank ◽  
Interest Rates ◽  
Commercial Banks ◽  
Profit Sharing ◽  
The Public ◽  
The Government ◽  
Islamic Economic ◽  
The Interest Rate

The government has an important role in the welfare of the people's economy. One of them is through the role of the central bank by carrying out monetary policy. This policy was adopted by the central bank or Bank Indonesia (BI) through several instruments, including through regulating discount rates for commercial banks. In this case, BI sets the inflation target as a reference for determining interest rates. When the inflation rate exceeds the targeted, BI will raise interest rates which in turn will reduce the credit issued by commercial banks to the public, because commercial banks must pay higher interest rates to the central bank. And the results of the analysis that the interest rate charged in the credit (Lending Facility) discount facility is classified as an act of usury. Meanwhile, the profits obtained from the deposit of funds in the Facility Deposit transaction are not permitted in the Islamic economy, because in the Islamic economy there is no interest rate but profit sharing, given the fixed and concrete interest rates. In addition, the discount facility is also incompatible with some Islamic economic principles, including; the principle of Illahiyah, Justice, and the government.

scholarly journals INTEREST RATE, MONEY SUPPLY AND GROWTH OF MORTGAGE FINANCING AMONG COMMERCIAL BANKS IN KENYA

2021 ◽  
Vol 6 (2) ◽  
pp. 1-11
Author(s):  
Chanzu Luyali ◽  
Julius Bichanga ◽  
M Gekara
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Money Supply ◽  
Commercial Banks ◽  
Time Series Data ◽  
Negative Impact ◽  
Model Specification ◽  
Series Data ◽  
Unique Contribution ◽  
The Government

Purpose: The purpose of this study was to investigate the effects of interest rate and money supply on the growth of mortgage financing among Commercial banks in Kenya. Materials and methods: The study adopted a descriptive research design. The population contained 35 loan lending commercial banks over a period between 1985 and 2019. Secondary data was used from desired financial statements available to the public of the singular commercial banks and other posted reports of financial institutions and establishments in conformity with the study. Time-series data were analyzed using STATA version 13 software, regression analysis and model specification tests. The hypothesis was tested using the multiple regression approach a significance level of 0.05 was used. Results: The study found that interest rate (coef= -0.0822, p= 0.007) and money supply (coef= 0.548, p= 0.00) have significant effects on the growth of mortgage financing among Kenyan commercial banks. Unique contribution to theory, practice and policy: Kenya's central bank should put in place mechanisms to guarantee that interest rates and money supply do not have adverse impacts on bank mortgage financing. The government should guarantee currency stability since currency fluctuations may have a negative impact on commercial bank mortgage borrowing. The classical theory is therefore relevant in our research since interest rates impact mortgages when capital demand increases. The quantity theory of money demand also holds that individuals want cash based on the transactions they need.

scholarly journals Evaluation of the Competitiveness of China’s Commercial Banks Based on the G-CAMELS Evaluation System

2019 ◽  
Vol 11 (6) ◽  
pp. 1791 ◽  
Author(s):  
Fangyuan Guan ◽  
Chuanzhe Liu ◽  
Fangming Xie ◽  
Huiying Chen
Keyword(s):  
Financial Institutions ◽  
Commercial Banks ◽  
Evaluation System ◽  
Rating System ◽  
Financial Industry ◽  
Entropy Weight ◽  
The Sustainable Development ◽  
Ranking Systems ◽  
The Government ◽  
The Impact

On the basis of the original camel rating system, this study added the green indicator and formed the G-CAMELS evaluation system (An improved rating system based on the CAMELS rating system to evaluate the business operation of financial institutions more comprehensively.) to comprehensively evaluate the competitiveness of commercial banks. It followed China’s current requirements for the sustainable development of commercial banks. In this paper, factor analysis, entropy methods, and dynamic evaluation models are used to obtain the ranking of competitiveness. In addition, according to the same steps as above, the comprehensive ranking based on the CAMELS evaluation system (A comprehensive rating system which is standardized, institutionalized and indexed for business operations of commercial banks and other financial institutions.) was obtained. The two ranking systems were compared. It is found that with the entropy weight method, in the G-CAMELS system, the weight of the green index is quite large, so it magnifies the impact of the financial industry on the environment. Compared with the original CAMELS system, the newly formed system will increase the ranking of state-owned banks and there is no significant change in the ranking of joint-stock banks. In order to improve the competitiveness of banks, state-owned banks should innovate their banking business and continue to implement the green credit policy; joint-stock banks should continue to seize the opportunity of green credit and expand profitability while paying attention to safety. In addition, the government could consider relaxing green credit standards for city commercial banks to ease pressure on banks.

scholarly journals Financing Industrial Development in Korea and Implications For Africa

2019 ◽  
pp. 548-570
Author(s):  
Keun Lee
Keyword(s):  
Industrial Policy ◽  
Industrial Development ◽  
Digital Tv ◽  
Financial Control ◽  
Development Bank ◽  
Capability Building ◽  
The Government ◽  
Role Of The Government

This chapter examines the implications of Korea’s industrial policy and financing for African economies that are trying to build their industrial bases. It considers industrial policy as essentially building the capabilities of private firms to sustain long-term economic growth and looks at the role of the government or industrial policy in this process of capability building. The chapter first provides an overview of the financial systems and industrial policy in Korea, focusing on the nature of financial control by the government and the roles and evolution of key development banks such as the Korea Development Bank. It then discusses three episodes of industrial policy and financing in these cases involving POSCO, targeted development of bottleneck technologies for small and medium-sized enterprises (SMEs), and leapfrogging into digital TV since the mid-1990s. Finally, it assesses the significance of the Korean experience for Africa, especially with regards to export manufacturing and resource-based development.

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