scholarly journals Family Control and Earnings Management: An Empirical Analysis of the Lebanese Banking Sector

2019 ◽  
Vol 9 (4) ◽  
pp. 124
Author(s):  
Ekramy S. Mokhtar ◽  
Ali M. Elharidy
Keyword(s):  
Financial Crisis ◽  
Earnings Management ◽  
Board Of Directors ◽  
Commercial Banks ◽  
Management Practices ◽  
Global Financial Crisis ◽  
Capital Adequacy ◽  
Board Size ◽  
Family Control ◽  
The Global Financial Crisis

This study aims to examine the relationship between board of directors’ characteristics, family control and earnings management practices in Lebanese commercial banks during 2008 to 2016. The characteristics of the board of directors are board size and role duality. Also, the study aims to identify earnings management practices during and after the global financial crisis. Earnings management was measured using discretionary accruals estimated by loan losses provision. The population for the study consists of Lebanese commercial banks registered with the Banque du Liban, which provided 182 bank/year observations during the study period. The results of the study indicate that Lebanese commercial banks with a relatively larger family control are more involved in earnings management practices. The study demonstrates that self-interest overrides common interests, leading the controlling family to maximize its own benefits at the expense of minority owners, resulting in more earnings management practices. In addition, capital adequacy and board size have significant positive influence on earnings management. Earnings management practices were not affected by role duality and bank size. Further, maintaining profitability was found to have a significant impact on earnings management practices. Finally, the results of the study indicate that Lebanese commercial banks became involved in earnings management practices after the global financial crisis compared to the period during the crisis.

scholarly journals The role of capital adequacy standards in creating financial safety of the bank: the evaluation and analysis of the survey results

2021 ◽  
Vol 20 (3) ◽  
pp. 641-657
Author(s):  
Irena Pyka ◽  
Aleksandra Nocoń ◽  
Mateusz Muszyński
Keyword(s):  
Financial Crisis ◽  
Commercial Banks ◽  
Global Financial Crisis ◽  
Banking System ◽  
Capital Adequacy ◽  
Bank Capital ◽  
Conducting Research ◽  
The Global Financial Crisis ◽  
Credit Institutions

Motivation: After the global financial crisis, banks’ financial safety has been considered as a public good and put under closer control and supervision. The prudential regulations of credit institutions which are the main subject of the study, have been significantly tightened. Although the minimum level of banks’ own funds, set adequately to the risk, had been a fundamental indicator of banks’ financial safety since the end of 1980s, after the global financial crisis the quality of this capital has changed and the scope of its regulation has been increased. By respecting the new prudential standards of the Basel Committee on Banking Supervision at the international level, financial safety of the banks has been additionally put under the macro-supervision. The concern about the overregulation of the banking system raises many controversies, what justifies conducting research on this subject. Aim: The main purpose of the article is to identify changes in the bank’s strategies of creating financial safety after the global financial crisis, considering macro- and micro-prudential regulations, aimed at strengthening the level and quality of bank capital, based on the results of the conducted research. Results: The results of the empirical research indicate that there is a strong belief among management staff in commercial banks in Poland that the increase in the level and structure of the own funds in credit institutions rises their financial safety. The results confirm the intensification of the process of implementing Basel regulations in commercial banks in Poland.

scholarly journals Risk management of Islamic banks: A search for empirical evidences

2017 ◽  
Vol 14 (2) ◽  
pp. 8-16
Author(s):  
Sayed M. Fadel ◽  
Jasim Al-Ajmi
Keyword(s):  
Risk Management ◽  
Financial Crisis ◽  
Management Practices ◽  
Global Financial Crisis ◽  
Risk Mitigation ◽  
Balance Sheet ◽  
Islamic Banks ◽  
Risk Levels ◽  
Management Techniques ◽  
The Global Financial Crisis

The objectives of this study are to determine 1) the effect of global economic and financial crisis on risk management, 2) the severity of different types of risk facing Islamic banks, 3) the risk levels of Islamic financial modes, 4) risk assessment techniques, and 5) risk management techniques. The structure of the balance sheet, the nature of Islamic finance instruments and funding sources have a great impact on the level of risk exposure of banks and the instruments. Credit risk is found to be the most serious risk, followed by liquidity risk, market risk and operational risk, in descending order of importance. As for the riskiness of Islamic financing modes, mudarabah is perceived to be the riskiest, followed by musharakah, while murabahah ranked as the least risky mode. Moreover, Islamic banks are found to use traditional risk management techniques more than sophisticated measurements. They also adopt risk mitigation techniques that are used by conventional banks in preference to techniques that are considered to be unique to Islamic banks. This paper is the first to study the risk management practices of Islamic banks operating in Bahrain. It also provides evidence about these practices after the global financial crisis that affected all countries, including Bahrain.

Restructuring Measurements Impact on Bank Risk After the Global Financial Crisis — Empirical Evidence from Vietnam

2021 ◽  
pp. 2150019
Author(s):  
Tu T. T. Tran ◽  
Yen Thi Nguyen
Keyword(s):  
Financial Crisis ◽  
Commercial Banks ◽  
Global Financial Crisis ◽  
Banking System ◽  
The State ◽  
Bank Risk ◽  
The Government ◽  
The Global Financial Crisis ◽  
Bank System ◽  
The Impact

Project 254 signed in November 2011 which is relating to “Restructuring the system of credit institutions in the period of 2011–2015” has been considered as a milestone in marking the Vietnamese government to prevent the influence of the financial crisis of 2008. This paper identifies hypotheses evaluating the impact of restructuring measurements on the risk of the Vietnamese’s commercial banks in 10 years, starting from 2008. Using the OLS regression method for analysis by running Eviews and ANOVA test in SPSS with a unique database of 216 observations of 31 commercial banks in Vietnam, it was found that: (i) The bail-out activities of the State Bank of Vietnam in 2015 does not influence on bank risk, (ii) The mergers and acquisitions (M&A) do not support the bank to reduce risk, it increases the risk for acquiring banks, (iii) The global crisis 2008 exerts dire consequence on the bank system in Vietnam, (iv) There is the difference of risk among the groups of the bank experiencing a different number of years of operation. Basing on this result, the paper also makes recommendations to the Government, The State Bank of Vietnam and the commercial banks for effective risk management toward the development of the Vietnamese banking system.

scholarly journals The Effect of the Global Financial Crisis on the Level of Accounting Conservatism in Commercial Banks: Evidence from Jordan

2017 ◽  
Vol 12 (2) ◽  
pp. 151 ◽  
Author(s):  
Yusuf Ali Al-Hroot ◽  
Laith Akram Muflih AL-Qudah ◽  
Faris Irsheid Audeh Alkharabsha
Keyword(s):  
Time Series ◽  
Financial Crisis ◽  
Commercial Banks ◽  
Time Series Data ◽  
Global Financial Crisis ◽  
Ordinary Least Squares ◽  
Accounting Conservatism ◽  
Series Data ◽  
Cross Sectional ◽  
The Global Financial Crisis

This paper intends to investigate whether the financial crisis (2008) exerted an impact on the level of accounting conservatism in the case of Jordanian commercial banks before and during the financial crisis. The sample of this study includes 78 observations; these observations are based on the financial statements of all commercial banks in Jordan and may be referred to as cross-sectional data, whereas the period from 2005 to 2011 represents a range of years characterized by time series data. The appropriate regression model to measure the relationship between cross-sectional data and time series data is in this case the pooled data regression (PDR) using the ordinary least squares (OLS) method. The results indicate that the level of accounting conservatism had been steadily increasing over a period of three years from 2005 to 2007. The results also indicate that the level of accounting conservatism was subjected to an increase during crisis period between 2009 and 2011 compared with the level of accounting conservatism for the period 2005-2007 preceding the global financial crisis. The F-test was used in order to test the significant differences between the regression coefficients for the period before and during the global financial crisis. The results indicate a positive impact on the accounting conservatism during the global financial crisis compared with the period before the global financial crisis. The p-value is 0.040 which indicates that there are statistically significant differences between the two periods; these results are consistent with the results in Sampaio (2015).

The Global Financial Crisis, Family Control, and Dividend Policy

2015 ◽  
Vol 45 (2) ◽  
pp. 291-313 ◽  
Author(s):  
Najah Attig ◽  
Narjess Boubakri ◽  
Sadok El Ghoul ◽  
Omrane Guedhami
Keyword(s):  
Financial Crisis ◽  
Dividend Policy ◽  
Global Financial Crisis ◽  
Family Control ◽  
The Global Financial Crisis

scholarly journals FINANCIAL PERFORMANCE OF ISLAMIC BANKING AFTER THE GLOBAL FINANCIAL CRISIS: A COMPARISON BETWEEN ISLAMIC COMMERCIAL BANKS AND ISLAMIC BUSINESS UNIT BANKS IN INDONESIA

2017 ◽  
Vol 4 (1) ◽  
pp. 149
Author(s):  
Laili Rahmi
Keyword(s):  
Financial Crisis ◽  
Financial Performance ◽  
Risk Ratio ◽  
Commercial Banks ◽  
Global Financial Crisis ◽  
Islamic Banking ◽  
Business Unit ◽  
Significant Difference ◽  
The Global Financial Crisis ◽  
The Impact

<p>The global financial crisis has affected some industries or non-industries around the world. It has also impacted to Islamic banking in Indonesia, especially after 2007-2008. It has been recorded the Islamic banking industry in Indonesia shows a speedy recovery from the impact of the global financial crisis. Thus, this study aims to evaluate and examine the differences of Islamic banking’s financial performance after the global financial crisis in Indonesia. The financial performances in this study are profitability ratio (Return on Asset (ROA) and Return on Equity (ROE)), liquidity ratio (Financing to Deposit Ratio (FDR) and Current Asset Ratio (CAR)) and solvency risk ratio (Equity Multiplier (EM) and Debt to Equity Ratio (DER)). The samples in this study are the six Islamic banks from Islamic Commercial Banks (Bank Usaha Sharia (BUS)) and Islamic Business Unit Banks (Unit Usaha Sharia (UUS)) in Indonesia. Based on the results shows by the descriptive statistic, UUS is more effective in using their assets to generate income compared to BUS, but BUS is greater to manage their financing and more liquid than UUS whose has higher risk than BUS during 2009-2013. Independent sample t-test shows that there is significant difference in terms of profitability, liquidity and solvency risk ratio between BUS and UUS Indonesia during 2009-2013</p>

scholarly journals Developing “best practices” for bankers’ pay in line with Basel III.

2011 ◽  
Vol 1 (3) ◽  
pp. 7-16 ◽  
Author(s):  
Peiyi Yu ◽  
Jessica Hong Yang ◽  
Nada Kakabadse
Keyword(s):  
Financial Crisis ◽  
Risk Taking ◽  
Global Financial Crisis ◽  
Capital Requirements ◽  
Capital Adequacy ◽  
Incentive Compensation ◽  
Basel Iii ◽  
Bank Capital ◽  
Bank Executives ◽  
The Global Financial Crisis

This paper proposes hybrid capital securities as a significant part of senior bank executive incentive compensation in light of Basel III, a new global regulatory standard on bank capital adequacy and liquidity agreed by the members of the Basel Committee on Banking Supervision. The committee developed Basel III in a response to the deficiencies in financial regulation brought about by the global financial crisis. Basel III strengthens bank capital requirements and introduces new regulatory requirements on bank liquidity and bank leverage. The hybrid bank capital securities we propose for bank executives’ compensation are preferred shares and subordinated debt that the June 2004 Basel II regulatory framework recognised as other admissible forms of capital. The past two decades have witnessed dramatic increase in performance-related pay in the banking industry. Stakeholders such as shareholders, debtholders and regulators criticise traditional cash and equity-based compensation for encouraging bank executives’ excessive risk taking and short-termism, which has resulted in the failure of risk management in high profile banks during the global financial crisis. Paying compensation in the form of hybrid bank capital securities may align the interests of executives with those of stakeholders and help banks regain their reputation for prudence after years of aggressive risk-taking. Additionally, banks are desperately seeking to raise capital in order to bolster balance sheets damaged by the ongoing credit crisis. Tapping their own senior employees with large incentive compensation packages may be a viable additional source of capital that is politically acceptable in times of large-scale bailouts of the financial sector and economically wise as it aligns the interests of the executives with the need for a stable financial system.

Impact of Financial Crisis on Credit Risk: Pre- and Post-financial Crises 
in an Emerging Economy

2020 ◽  
Vol 9 (2) ◽  
pp. 118-132
Author(s):  
Syed Moudud-Ul-Huq ◽  
Rabaka Akter ◽  
Tanmay Biswas
Keyword(s):  
Risk Management ◽  
Financial Crisis ◽  
Credit Risk ◽  
Commercial Banks ◽  
Global Financial Crisis ◽  
Banking System ◽  
Commercial Banking ◽  
Real Economy ◽  
Credit Risk Management ◽  
The Global Financial Crisis

This aim of the article is to establish a model to discuss the reasons for changing the level of credit risk among the commercial banks of Bangladesh during the global financial crisis (GFC). Credit risk has been remaining as the essential and core risk in commercial banking activities. Multiple regression analysis is used to test the relationship among the level of credit risk as a dependent variable and financial crisis, other bank-level variables and macroeconomic variables. The causes of the GFC revealed not only systematic or structural imbalances but also the necessity to keep and strengthen the principles of credit risk management. We analyse the leading causes of the recent GFC. Moreover, the lessons that must be learnt from the weaknesses of credit risk management systems. Credit risk was found to respond to macroeconomic conditions, which indicate strong feedback effects from the banking system to the real economy. This article represents the analysis of the influence of the financial crisis on credit risk management in commercial banks and summarizes the challenges faced by banks for credit risk improvement. We hope that this reality creates new opportunities for managing credit risk in the future to increase this importance in the banks and the overall economy of Bangladesh.

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