Dependence in the Banking Sector of the United States and Mexico: A Copula Approach

The objective of this work is to estimate the patterns of dependence between the yields of the stock prices of the main banks of the United States (US) and Mexico. We estimate the patterns of absolute dependence and tail dependence through copulas of the Archimedean family and the use of rolling windows of 245 days. The data employed come from the daily share prices at closing from January 2, 2015, to December 31, 2020, for seven banks. Our results show that: i) there are patterns of high dependence among the main banks in the US, ii) there are patterns of very low dependence among the main banks in the US and Mexico, and iii) there are patterns of low dependence among the main banks in Mexico. These results have several implications, among them that the high-dependency patterns obtained among major US banks limit the joint selection of these US bank equity assets in an investment portfolio. Although this paper focuses on a small sample of banks, they represent an important portion of the banking sector in both countries. Given the limited literature on this subject in Mexico, our paper contributes to expanding this literature with a novel approach.

An analysis of the SME–bank match made in heaven: the case of New Zealand main banks and their relationship-managed SMEs

Purpose The purpose of this paper is to answer the increasing calls to analyse how lending relationship between banks and their small- and medium-sized enterprises (SMEs) work. More precisely, the main aim is to investigate the lending approach(es) and criteria used by banks to assess loan applications from their relationship-managed (RM) SMEs’ clients. Other objectives include investigating the level of congruence in terms of lending practices and processes among the sample banks in New Zealand (NZ) and to discern how the assessment of the SME owner/manager is done within the relationship-banking framework. Design/methodology/approach The research objectives concern investigating processes and not variances. Thus, a qualitative research approach was used. Extensive data was collected via interviews across representative banks in NZ and thematic analysis was used to analyse the data. Findings The findings include a detailed analysis of how relationship banking actually works; how in NZ, the main bank brands use three criteria of lending (financials, security and character) as a framework of assessing loan applications from RM-clients – which is different from the character, capital, capacity, conditions, and collateral (5Cs) that are widely used and discussed as the framework of lending; and an elucidation as to why and how character assessment is different from the other criteria of lending. Originality/value To the best of authors’ knowledge, this is the first study to investigate the mechanisms and processes that banks use to deal with their RM-SMEs, show the existence of a different framework of lending other than the 5Cs and attempt an explanation as to why character evaluation is different from that of the other criteria of lending.

Estimacion de Economias de Escala en el Mercado de Tarjetas de Pago

During the last years, the growth of transactions made through credit and debit cards has presented quite signif- icant increases both in number and in amounts. This paper studies the existence of economies of scale in the pro- cessing of such transactions, a situation that would exist if it were compatible with the existence of a single firm destined to the processing of said operations. The existence of a single firm for processing is not in itself a problem per se, which does generate problems for the competition is the structure of said firm, because for the period of time analyzed, its shareholder composition was composed of The main banks that issue these cards, but also have given them the function of being the acquirer of the merchants for these payment methods, which generates a vertically inte- grated structure, which creates competition problems in the market. After estimating the model indirectly from a cost function, this work determines the existence of economies of scale in the industry.

The Impact of CSR Reputation and Customer Loyalty

Intense competition has in many markets decreased the prospects for differentiation in terms of technology and product/service quality. For this reason, CSR becomes an important attribute that can enhance a company's image. To win customers' loyalty in today's markets, companies have to focus on building and sustaining customer loyalty. Nowadays, organizations looking forward to achieving a sustainable competitive improvement based on focusing on a customer-oriented concept which will lead to customer satisfaction, trust and finally to customer loyalty. In this regard, CSR has become a valuable tool. This research, therefore, aims to investigate the direct effect of CSR on customer loyalty by observing the intervening influence of Perceived service quality and trust. In this research, it is proved CSR aspects namely business practice CSR which is related to primary stakeholders, such as customers and employees, and philanthropic CSR, which is related to secondary stakeholders, such as the community has a positive and significant effect on the customer loyalty. Moreover, perceived service quality and trust also serve as an intervener between CSR and Loyalty. Data collected from account holders of three main banks in Kenya. Structural equation modeling is examined by using PLS software. The findings of this study would help scholars in developing more CSR based loyalty models. These findings can also aid the service industry such as commercial banks in Kenya to better incorporate CSR initiatives in their strategic planning process

Credit Risk Versus Performance in the Romanian Banking System

The Romanian banking sector, predominantly governed by the capital of foreign banks, is, as well as other international banking sectors, under the sign of the necessary balance that should exist between risk and performance. This is a result of banks trying to take risks that they can control, given that they need to generate financial results that are satisfactory for all categories of bank creditors, namely shareholders, depositors and other lenders. In this paper, I wanted to analyze the risk situation assumed by the main banks in the system versus the performance gained in recent years. This article is part of a wider research, so I will refer only to the main risk assumed by a bank, namely the credit risk, I will highlight the evolution of the indicators of this risk, so that I can finally analyze their degree of correlation with indicators for measuring bank performance. The situation of other financial risks in banking activity will be addressed in other works.

Factors Affecting Customers' Adoption of E-Banking Services in Jordan

This study aimed to identify and analyze factors affecting customers' adoption of E-Banking services in Jordan. The study sample was 450 E-banking services users, who have been chosen from nine main banks selected by the researchers. The study concluded that there was a significant effect of (E-Service Quality, E-Perceived Usefulness, E-Security, E-Reliability) on the adoption of E-Banking services. E-Service quality was the most effecting factor on customers' adoption of E-Banking services, while E-Security was the least influential factor. The study proved the existence of the effect of the following E-Service quality dimensions: E-Ease of Use, E-Privacy, E-Efficiency, E-Design and E-Cost Effectiveness and denied the existence of the effect of E-Responsiveness on customers' adoption of E-banking services.

Does Diffusion Make an Institutionally Contested Practice Legitimate? Shareholder Responses to Downsizing in Japan, 1973–2005

Despite predictions to the contrary, institutionally contested practices are sometimes disseminated broadly. Does diffusion indicate they have achieved legitimacy in the eyes of key constituents? The conventional view regards diffusion as a process of legitimization and suggests that unconventional practices gain legitimacy following diffusion. Building on recent studies that view diffusion as an outcome of political struggle, we instead argue that political contestation ramps up as controversial practices are disseminated, making it difficult for them to gain wide acceptance. Their diffusion threatens the stability of preexisting institutional arrangements, and constituents who remain supportive of the status quo react negatively. We test our argument by examining shareholders’ response to downsizing in Japan, a practice that is highly controversial given the deeply entrenched norm of lifetime employment. Our analysis of panel data on 1,791 Japanese firms between 1973 and 2005 shows that neither domestic financial institutions nor foreign investors responded positively to downsizing as it became broadly disseminated. Domestic financial institutions actually responded in increasingly negative ways in the 1990s, while they did not in the 1970s when downsizing was conducted within the framework of the long-term relationship between Japanese firms and their main banks. These results suggest that the relationship between diffusion and legitimacy can be contingent, in that the diffusion of institutionally contested practices can trigger reactions that differ from those of institutionally supported practices.