Pub Date : 1900-01-01DOI: 10.32890/ijbf2008.5.1.8365
Jarunee Wonglimpiyarat
This paper reports on the technological capabilities and learning of Thai banking system. It identifies innovation development of the system as it evolved and how the learning process took place. This study is based on a leading technological regime change literature and the results are based on the study of five commercial banks: Bangkok Bank, Siam Commercial Bank, Thai Farmers Bank (Kasikorn Bank), Krung Thai Bank, and Bank of Ayudhya. Mass automation of work procedures occurred during the 1960s and 1970s while the smart automation regime began in the early 1970s. The ways in which the banks improved their technological capabilities via electronic banking services is explored. The results also show that the use of technology in the mass automation regime is carried through to the smart automation regime, showing that the technological change in the banking sector is not revolutionary, but ocurred slowly, i.e. evoled via slow learing process.
{"title":"Thai Banking: A Note on Technological Change and Technological Capabilities","authors":"Jarunee Wonglimpiyarat","doi":"10.32890/ijbf2008.5.1.8365","DOIUrl":"https://doi.org/10.32890/ijbf2008.5.1.8365","url":null,"abstract":"This paper reports on the technological capabilities and learning of Thai banking system. It identifies innovation development of the system as it evolved and how the learning process took place. This study is based on a leading technological regime change literature and the results are based on the study of five commercial banks: Bangkok Bank, Siam Commercial Bank, Thai Farmers Bank (Kasikorn Bank), Krung Thai Bank, and Bank of Ayudhya. Mass automation of work procedures occurred during the 1960s and 1970s while the smart automation regime began in the early 1970s. The ways in which the banks improved their technological capabilities via electronic banking services is explored. The results also show that the use of technology in the mass automation regime is carried through to the smart automation regime, showing that the technological change in the banking sector is not revolutionary, but ocurred slowly, i.e. evoled via slow learing process.","PeriodicalId":170943,"journal":{"name":"The International Journal of Banking and Finance","volume":"57 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130161003","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 1900-01-01DOI: 10.32890/ijbf2003.1.2.8336
Z. Iqbal, Glenn N. Pettengill, Shekar T. Shetty
Following the enactment of ERISA (Employee Retirement Income Security Act) in 1974, employee stock ownership plans (ESOPs) have become a popular form of employee compensation among U.S. companies. The introduction of an ESOP has important implications for management interest that should encourage insiders buying activity. This paper documents that unusual insider buying activity has indeed resulted from the introduction of an ESOP. Further we examine two competing explanations, the wealth hypothesis and the control hypothesis, for the increase in insiders buying activity. We conclude that insiders buying activity is primarily motivated by control considerations.
{"title":"Insider trading around ESOP announcements: Wealth effect vs. control effect","authors":"Z. Iqbal, Glenn N. Pettengill, Shekar T. Shetty","doi":"10.32890/ijbf2003.1.2.8336","DOIUrl":"https://doi.org/10.32890/ijbf2003.1.2.8336","url":null,"abstract":"Following the enactment of ERISA (Employee Retirement Income Security Act) in 1974, employee stock ownership plans (ESOPs) have become a popular form of employee compensation among U.S. companies. The introduction of an ESOP has important implications for management interest that should encourage insiders buying activity. This paper documents that unusual insider buying activity has indeed resulted from the introduction of an ESOP. Further we examine two competing explanations, the wealth hypothesis and the control hypothesis, for the increase in insiders buying activity. We conclude that insiders buying activity is primarily motivated by control considerations.","PeriodicalId":170943,"journal":{"name":"The International Journal of Banking and Finance","volume":"9 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126684675","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 1900-01-01DOI: 10.32890/ijbf2010.7.1.8399
M. Majid
Islamic banking activities are limited within the scope of shari’ah which is within the scope of socially responsible and ethical banking activities, different from that based on interest-based banking. This paper attempts to measure the input data required by shari’ah-compliant banking in comparison with conventional banking to estimate their relative efficiencies and economies of and returns to scale. Cost and output distance functions were estimated for a sample of banks in 10 countries which operate both types of banking. The results showed that shari’ah-compliant banking has higher input requirements relative to interest based banking, but exhibit superior average efficiency only in Malaysia but inferior average efficiency in cross-country analysis. There is little evidence of differences in economies/returns to scale between shari’ah and conventional banks.
{"title":"The Input Requirements of Conventional and Shariah compliant Banking","authors":"M. Majid","doi":"10.32890/ijbf2010.7.1.8399","DOIUrl":"https://doi.org/10.32890/ijbf2010.7.1.8399","url":null,"abstract":"Islamic banking activities are limited within the scope of shari’ah which is within the scope of socially responsible and ethical banking activities, different from that based on interest-based banking. This paper attempts to measure the input data required by shari’ah-compliant banking in comparison with conventional banking to estimate their relative efficiencies and economies of and returns to scale. Cost and output distance functions were estimated for a sample of banks in 10 countries which operate both types of banking. The results showed that shari’ah-compliant banking has higher input requirements relative to interest based banking, but exhibit superior average efficiency only in Malaysia but inferior average efficiency in cross-country analysis. There is little evidence of differences in economies/returns to scale between shari’ah and conventional banks.","PeriodicalId":170943,"journal":{"name":"The International Journal of Banking and Finance","volume":"4 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125738213","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 1900-01-01DOI: 10.32890/ijbf2012.9.3.8459
Xiaoxiang Zhang, K. Daly
This paper reports results on the performance of mainland China-owned banks operating in Hong Kong and compares them Hong Kong (SAR) owned banks and Foreign owned banks. In general, the test model performs well under diagnostic tests on variables such as net interest margin, non-interest expense, impaired loans ratio, equity multiplier and ownership structures. Profitability, as measured by return on assets and return on equity for Chinese owned banks increased over the period 2004-2011. Chinese owned banks recorded increased performance in terms of net interest margin and equity multiplier but decreased with respect to non-interest expense and impaired loans ratio. Banks having a license also appears to be a major contributor to banks profitability across HKSAR. Compared to Hong Kong based foreign banks and local Hong Kong banks, we found that in general the mainland China banks tend to perform poorly across a number of key banking performance indicators.
{"title":"Performance of China-Owned Banks in Hong Kong","authors":"Xiaoxiang Zhang, K. Daly","doi":"10.32890/ijbf2012.9.3.8459","DOIUrl":"https://doi.org/10.32890/ijbf2012.9.3.8459","url":null,"abstract":"This paper reports results on the performance of mainland China-owned banks operating in Hong Kong and compares them Hong Kong (SAR) owned banks and Foreign owned banks. In general, the test model performs well under diagnostic tests on variables such as net interest margin, non-interest expense, impaired loans ratio, equity multiplier and ownership structures. Profitability, as measured by return on assets and return on equity for Chinese owned banks increased over the period 2004-2011. Chinese owned banks recorded increased performance in terms of net interest margin and equity multiplier but decreased with respect to non-interest expense and impaired loans ratio. Banks having a license also appears to be a major contributor to banks profitability across HKSAR. Compared to Hong Kong based foreign banks and local Hong Kong banks, we found that in general the mainland China banks tend to perform poorly across a number of key banking performance indicators.","PeriodicalId":170943,"journal":{"name":"The International Journal of Banking and Finance","volume":"6 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125503667","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 1900-01-01DOI: 10.32890/ijbf2013.10.1.8466
Reyes Samaniego Medina, M. J. V. Cueto
The Basel Accords encourages credit entities to implement their own models for measuring financial risk. In this paper, we focus on the use of internal ratings-based (IRB) models for the assessment of credit risk and, specifically, on one component that models the probability of default (PD). The traditional methods used for modelling credit risk, such as discriminant analysis and logit and probit models, start with several statistical restrictions. The rough set methodology avoids these limitations and as such is an alternative to the classic statistical methods. We apply the rough set methodology to a database of 106 companies that are applicants for credit. We obtain ratios that can best discriminate between financially sound and bankrupt companies, along with a series of decision rules that will help detect operations that are potentially in default. Finally, we compare the results obtained using the rough set methodology to those obtained using classic discriminant analysis and logit models. We conclude that the rough set methodology presents better risk classification results.
{"title":"MODELING CREDIT RISK: AN APPLICATION OF THE ROUGH SET METHODOLOGY","authors":"Reyes Samaniego Medina, M. J. V. Cueto","doi":"10.32890/ijbf2013.10.1.8466","DOIUrl":"https://doi.org/10.32890/ijbf2013.10.1.8466","url":null,"abstract":"The Basel Accords encourages credit entities to implement their own models for measuring financial risk. In this paper, we focus on the use of internal ratings-based (IRB) models for the assessment of credit risk and, specifically, on one component that models the probability of default (PD). The traditional methods used for modelling credit risk, such as discriminant analysis and logit and probit models, start with several statistical restrictions. The rough set methodology avoids these limitations and as such is an alternative to the classic statistical methods. We apply the rough set methodology to a database of 106 companies that are applicants for credit. We obtain ratios that can best discriminate between financially sound and bankrupt companies, along with a series of decision rules that will help detect operations that are potentially in default. Finally, we compare the results obtained using the rough set methodology to those obtained using classic discriminant analysis and logit models. We conclude that the rough set methodology presents better risk classification results.","PeriodicalId":170943,"journal":{"name":"The International Journal of Banking and Finance","volume":"47 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132261584","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 1900-01-01DOI: 10.32890/ijbf2010.7.2.8413
Ariful Hoque, M. Manzur, Geoffrey Poitras
This paper tests the impact of transaction cost specification on deviations from lower boundary and put-call parity properties. Using PHLX traded foreign exchange options, prices for puts and calls are matched to the nearest five minutes. The results indicate how boundaries on the arbitrage profit function determined by alternative measures of transactions costs can impact the interpretation of deviations from distribution free properties of options such as put-call parity.
{"title":"Influence of transaction costs on foreign exchange option contracts: Intra-daily tests","authors":"Ariful Hoque, M. Manzur, Geoffrey Poitras","doi":"10.32890/ijbf2010.7.2.8413","DOIUrl":"https://doi.org/10.32890/ijbf2010.7.2.8413","url":null,"abstract":"This paper tests the impact of transaction cost specification on deviations from lower boundary and put-call parity properties. Using PHLX traded foreign exchange options, prices for puts and calls are matched to the nearest five minutes. The results indicate how boundaries on the arbitrage profit function determined by alternative measures of transactions costs can impact the interpretation of deviations from distribution free properties of options such as put-call parity.","PeriodicalId":170943,"journal":{"name":"The International Journal of Banking and Finance","volume":"29 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128782868","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 1900-01-01DOI: 10.32890/ijbf2011.8.4.8443
C. Agu, D. Olajide, D. Ikenwilo, A. Orji
This paper examines the determinants of the exit behaviour of banks in the Nigerian consolidation program during July 2004 and December 2005. We conceptualise the exit process in a flexible bivariate competing risks model to examine the importance of macroeconomic and industry-specific factors for both merged banks and failed banks jointly. The preliminary results suggest that bank-specific characteristics mattered more for preventing bank failure than they did for emergence of the M&A banks. Second, the Central Bank of Nigeria’s assistance was highly influential in preventing bank failure, and, for banks that benefited, the assistance increased their probability of being merged or acquired. Also, we found no strong evidence suggesting that the prevailing macroeconomic conditions and industry-specific factors had influenced exit behaviour of banks during the consolidation exercise. We found evidence of structural dependence between failure and merger and acquisition hazards induced by CBN incentive.
{"title":"MERGERS AND ACQUISITIONS: THE NIGERIAN BANKING CONSOLIDATION PROGRAM","authors":"C. Agu, D. Olajide, D. Ikenwilo, A. Orji","doi":"10.32890/ijbf2011.8.4.8443","DOIUrl":"https://doi.org/10.32890/ijbf2011.8.4.8443","url":null,"abstract":"This paper examines the determinants of the exit behaviour of banks in the Nigerian consolidation program during July 2004 and December 2005. We conceptualise the exit process in a flexible bivariate competing risks model to examine the importance of macroeconomic and industry-specific factors for both merged banks and failed banks jointly. The preliminary results suggest that bank-specific characteristics mattered more for preventing bank failure than they did for emergence of the M&A banks. Second, the Central Bank of Nigeria’s assistance was highly influential in preventing bank failure, and, for banks that benefited, the assistance increased their probability of being merged or acquired. Also, we found no strong evidence suggesting that the prevailing macroeconomic conditions and industry-specific factors had influenced exit behaviour of banks during the consolidation exercise. We found evidence of structural dependence between failure and merger and acquisition hazards induced by CBN incentive.","PeriodicalId":170943,"journal":{"name":"The International Journal of Banking and Finance","volume":"90 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127754225","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 1900-01-01DOI: 10.32890/ijbf2008.5.2.8370
Panos Priftakis, M. Bhatti, La Trobe
There are several hypotheses suggesting that some properties of oil prices make it interesting to focus on the predictive ability of oil prices for stock returns. This paper reviews some models recently used in the literature and selects the most suitable one for measuring the relationships and/or linkages of oil prices to the stock markets of the selected five oil producing countries in the Middle East. In particular, the paper uses two methodologies to test for the presence of a cointegrating relationship between the two variables and an unobserved-components model to find a relationship between the two variables. The results rejects convincingly that there is no linkage between the prices of oil and the stock market prices in these oil-based economies.
{"title":"A NOTE ON 'WHAT DRIVES SHARE PRICES IN THE MIDDLE EAST?'","authors":"Panos Priftakis, M. Bhatti, La Trobe","doi":"10.32890/ijbf2008.5.2.8370","DOIUrl":"https://doi.org/10.32890/ijbf2008.5.2.8370","url":null,"abstract":"There are several hypotheses suggesting that some properties of oil prices make it interesting to focus on the predictive ability of oil prices for stock returns. This paper reviews some models recently used in the literature and selects the most suitable one for measuring the relationships and/or linkages of oil prices to the stock markets of the selected five oil producing countries in the Middle East. In particular, the paper uses two methodologies to test for the presence of a cointegrating relationship between the two variables and an unobserved-components model to find a relationship between the two variables. The results rejects convincingly that there is no linkage between the prices of oil and the stock market prices in these oil-based economies.","PeriodicalId":170943,"journal":{"name":"The International Journal of Banking and Finance","volume":"60 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128477365","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 1900-01-01DOI: 10.32890/ijbf2012.9.2.8452
Harry M. Karamujic
Overall, building approvals for new houses (BANHs) are viewed by most economic analysts/commentators as a leading indicator of property investment due to the importance of this sector to the whole economy and employment. This study seeks shed some additional light on modelling this seasonal behaviour of BANHs by: (i) establishing the presence of seasonality in Victorian BANHs; (ii) ascertaining it as to whether is deterministic or stochastic; (iii) estimating out-of-sample forecasting capabilities of the modelling specification; and (iv) speculating on possible interpretation of results. The study utilises a structural time series model of Harvey. Factors corresponding to June, April, December and November are found to be significant at five per cent level. The observed seasonality could be attributed to both the summer holidays and the end of financial year seasonal effects. Irrespective of partially incomplete nature of this research, the findings should be appealing to, among others, researchers, all levels of Government, construction industry and banking industry.
{"title":"Building Approvals as a Leading Indicator of Property Sector Investment","authors":"Harry M. Karamujic","doi":"10.32890/ijbf2012.9.2.8452","DOIUrl":"https://doi.org/10.32890/ijbf2012.9.2.8452","url":null,"abstract":"Overall, building approvals for new houses (BANHs) are viewed by most economic analysts/commentators as a leading indicator of property investment due to the importance of this sector to the whole economy and employment. This study seeks shed some additional light on modelling this seasonal behaviour of BANHs by: (i) establishing the presence of seasonality in Victorian BANHs; (ii) ascertaining it as to whether is deterministic or stochastic; (iii) estimating out-of-sample forecasting capabilities of the modelling specification; and (iv) speculating on possible interpretation of results. The study utilises a structural time series model of Harvey. Factors corresponding to June, April, December and November are found to be significant at five per cent level. The observed seasonality could be attributed to both the summer holidays and the end of financial year seasonal effects. Irrespective of partially incomplete nature of this research, the findings should be appealing to, among others, researchers, all levels of Government, construction industry and banking industry.","PeriodicalId":170943,"journal":{"name":"The International Journal of Banking and Finance","volume":"23 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126397362","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 1900-01-01DOI: 10.32890/ijbf2010.7.1.8400
A. Hibbert, Edward R. Lawrence
Using return data for all stocks continuously traded on the NYSE over the period July 1963 to December 2006, we tested the performance of the two-moment Capital Asset Pricing Model (CAPM) and the Fama French three-factor model in explaining individual stock returns. We found the performance of Fama French three-factor model to be marginally better than the CAPM.We further test the models for the significance and stability of parameters in the bull/bear periods and the Federal increasing/decreasing interest rate periods and found the performance of the two models comparable.
{"title":"Testing the performance of asset pricing models in different economic and interest rate regimes using individual stock returns","authors":"A. Hibbert, Edward R. Lawrence","doi":"10.32890/ijbf2010.7.1.8400","DOIUrl":"https://doi.org/10.32890/ijbf2010.7.1.8400","url":null,"abstract":"Using return data for all stocks continuously traded on the NYSE over the period July 1963 to December 2006, we tested the performance of the two-moment Capital Asset Pricing Model (CAPM) and the Fama French three-factor model in explaining individual stock returns. We found the performance of Fama French three-factor model to be marginally better than the CAPM.We further test the models for the significance and stability of parameters in the bull/bear periods and the Federal increasing/decreasing interest rate periods and found the performance of the two models comparable.","PeriodicalId":170943,"journal":{"name":"The International Journal of Banking and Finance","volume":"4 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129390911","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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