Purpose: The purpose of this study is to ascertain which financial factors affect the price-to-earnings ratios of Canadian firms. Methodology: A sample of 578 Canadian firms, across 11 industries, listed on the Toronto Stock Exchange during 2011 to 2018 is examined. Stock prices and financial statements accounts data is collected from S & P Capital IQ. We compute 27 financial factors to use as independent variables to regress on the price-to-earnings ratio dependent variables employing the Statistical Package for Social Sciences (SPSS) utilizing the software program’s forced, forward, and backward selection methods. Robustness tests are conducted using alternative dates (after the fiscal year end) to discover which model of financial factors best explains the forward price-to-earnings ratio as well as other statistical methods such as analysis of variance. Results: We find a unique model for each of the 3 models based on the forward price-to-earnings ratio date. The financial factors that explain each of the dates after the end of the fiscal year (1 month, 2 months, and 3 months) are the 4 variables: net profit margin, return on investment, total asset turnover, and the natural logarithm of the total assets. For model 3 (1 month after fiscal year end), in addition to the previous 4 factors, the dividends per share is part of the regression equation. All 3 models have strong statistically significant results at an alpha level of one percent. Further, industry effects are deduced and presented. Unique contribution to theory, policy, and practice: The results are unique to a Canadian sample of firms post- International Financial Reporting Standards (IFRS) adoption. Companies can utilize the empirical findings to manage their financial performance to maximize their price-to-earnings ratio. A product of a firm’s higher price-to-earnings ratio is a lower cost of capital which expands the corporation’s investment opportunities. Investors can apply this research to develop investment strategies hinged on price-to-earnings ratios to augment investment returns.
{"title":"Financial Factors Affecting Price-to-Earnings Ratios in Canada","authors":"Natalia Popa Antalovschi, Raymond A. K. Cox","doi":"10.47941/IJF.660","DOIUrl":"https://doi.org/10.47941/IJF.660","url":null,"abstract":"Purpose: The purpose of this study is to ascertain which financial factors affect the price-to-earnings ratios of Canadian firms. \u0000Methodology: A sample of 578 Canadian firms, across 11 industries, listed on the Toronto Stock Exchange during 2011 to 2018 is examined. Stock prices and financial statements accounts data is collected from S & P Capital IQ. We compute 27 financial factors to use as independent variables to regress on the price-to-earnings ratio dependent variables employing the Statistical Package for Social Sciences (SPSS) utilizing the software program’s forced, forward, and backward selection methods. Robustness tests are conducted using alternative dates (after the fiscal year end) to discover which model of financial factors best explains the forward price-to-earnings ratio as well as other statistical methods such as analysis of variance. \u0000Results: We find a unique model for each of the 3 models based on the forward price-to-earnings ratio date. The financial factors that explain each of the dates after the end of the fiscal year (1 month, 2 months, and 3 months) are the 4 variables: net profit margin, return on investment, total asset turnover, and the natural logarithm of the total assets. For model 3 (1 month after fiscal year end), in addition to the previous 4 factors, the dividends per share is part of the regression equation. All 3 models have strong statistically significant results at an alpha level of one percent. Further, industry effects are deduced and presented. \u0000Unique contribution to theory, policy, and practice: The results are unique to a Canadian sample of firms post- International Financial Reporting Standards (IFRS) adoption. Companies can utilize the empirical findings to manage their financial performance to maximize their price-to-earnings ratio. A product of a firm’s higher price-to-earnings ratio is a lower cost of capital which expands the corporation’s investment opportunities. Investors can apply this research to develop investment strategies hinged on price-to-earnings ratios to augment investment returns.","PeriodicalId":53549,"journal":{"name":"International Journal of Banking, Accounting and Finance","volume":"46 1","pages":"43-61"},"PeriodicalIF":0.0,"publicationDate":"2021-08-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75293588","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}
Purpose: The purpose of this study was to investigate the Influence of leverage risk on performance of selected real estates in Meru County Kenya. Methodology: This study employed a descriptive research design. The target population comprised of 390 real estate owners and the sample size was 197 respondents. Stratified random sampling and purposive sampling procedures were used to select the sample size from the target population. Data was analyzed by use of SPSS version 23. Descriptive statistics and inferential statistics such as Regression, and Analysis of variance (ANOVA) were used to present the results in tables and figures. Results: This study revealed statistically significant relationships between leverage risk and performance of real estate investments. This study established that Leverage risk had a statistically significant influence on real estate investment performance (r=.686, p<0.01), (f=12.29, p<0.01). However, Real estate investments was not affected by market risk since it had the least influence on its performance. Unique contribution to theory, policy and practice: The study added value to Investors on necessity to evaluate leverage risk, as well as maintain a well-balanced capital structure when making real estate investment decisions. There is dire need for central bank of Kenya to amend lending rates specifically on mortgages. The study informed policy decision to the ministry of finance & central bank of Kenya on implementing fiscal and monetary policies that create an enabling environment. A further study on determinants of leverage in real estate investments need to be done.
目的:本研究的目的是探讨杠杆风险对肯尼亚梅鲁县选定房地产绩效的影响。方法:本研究采用描述性研究设计。目标人群为390名房地产业主，样本量为197名受访者。采用分层随机抽样和有目的抽样方法从目标人群中选择样本量。数据分析采用SPSS version 23。使用描述性统计和推理统计，如回归和方差分析(ANOVA)，以表格和图表的形式呈现结果。结果:本研究揭示了杠杆风险与房地产投资绩效之间具有统计学意义的关系。本研究证实杠杆风险对房地产投资绩效的影响具有统计学意义(r=)。686, p<0.01)， f=12.29, p<0.01)。而房地产投资不受市场风险的影响，因为市场风险对其业绩的影响最小。独特的理论、政策和实践贡献:本研究为投资者在进行房地产投资决策时评估杠杆风险的必要性以及保持良好的资本结构增加了价值。肯尼亚中央银行迫切需要修改贷款利率，特别是抵押贷款利率。该研究为肯尼亚财政部和中央银行实施创造有利环境的财政和货币政策提供了决策依据。房地产投资杠杆的决定因素有待进一步研究。
{"title":"THE RELATIONSHIP BETWEEN LEVERAGE RISK AND PERFORMANCE OF SELECTED REAL ESTATE INVESTMENTS IN MERU COUNTY- KENYA","authors":"Kenneth Mburugu, N. Rintari, Fredrick Mutea","doi":"10.47941/IJF.659","DOIUrl":"https://doi.org/10.47941/IJF.659","url":null,"abstract":"Purpose: The purpose of this study was to investigate the Influence of leverage risk on performance of selected real estates in Meru County Kenya. \u0000Methodology: This study employed a descriptive research design. The target population comprised of 390 real estate owners and the sample size was 197 respondents. Stratified random sampling and purposive sampling procedures were used to select the sample size from the target population. Data was analyzed by use of SPSS version 23. Descriptive statistics and inferential statistics such as Regression, and Analysis of variance (ANOVA) were used to present the results in tables and figures. \u0000Results: This study revealed statistically significant relationships between leverage risk and performance of real estate investments. This study established that Leverage risk had a statistically significant influence on real estate investment performance (r=.686, p<0.01), (f=12.29, p<0.01). However, Real estate investments was not affected by market risk since it had the least influence on its performance. \u0000Unique contribution to theory, policy and practice: The study added value to Investors on necessity to evaluate leverage risk, as well as maintain a well-balanced capital structure when making real estate investment decisions. There is dire need for central bank of Kenya to amend lending rates specifically on mortgages. The study informed policy decision to the ministry of finance & central bank of Kenya on implementing fiscal and monetary policies that create an enabling environment. A further study on determinants of leverage in real estate investments need to be done.","PeriodicalId":53549,"journal":{"name":"International Journal of Banking, Accounting and Finance","volume":"156 1","pages":"36-42"},"PeriodicalIF":0.0,"publicationDate":"2021-08-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77128340","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}
Purpose: The purpose of the study is to model and simulate the trends and behavioral patterns in The Nigerian Stock Market and hence predict the future stock prices within the Geometric Brownian Motion (GBM) framework. Methodology: The methodology involves a comparison of forecasted daily closing prices to actual prices in order to evaluate the accuracy of the prediction model. Based on the model assumptions of the GBM with drift: continuity, normality and Markov tendency, the study investigated four years (2015 - 2018) of historical closing prices of ten stocks listed on The Nigerian Stock Exchange. The sample for this study is based on the most continuously traded stocks. Findings: The results show that in the simulation there are some actual stock prices located outside trajectory realization that may be from GBM model. Thus, the model did not predict accurately the price behavior of some of the listed stocks. The predictive power of the model is declining towards the longer the evaluated time frame proven by the higher value of the mean absolute percentage error. The value of the MAPE is 50% and below for the one- to two-year holding periods, and above 50% for the three-year holding period. Unique Contribution to theory, Practice and Policy: The MAPE and directional prediction accuracy method provide support that over short periods the GBM model is accurate. Meaning that the GBM is a reasonable predictive model for one or two years, but for three years, therefore, it is an inaccurate predictor. It is recommended that the technical analyst whose primary motive is to make gain at the expense of other participants should identify high volatile portfolio in any holding period for effective prediction Investors with long-range holding position as investment strategy should concentrate more on low capitalized stocks rather than stocks with large market capitalization. This is a unique contribution to theory, practice and policy.
{"title":"Stochastic Forecasting of Stock Prices in Nigeria: Application of Geometric Brownian Motion Model","authors":"A. Toby, Samuel Azubuike Agbam","doi":"10.47941/IJF.646","DOIUrl":"https://doi.org/10.47941/IJF.646","url":null,"abstract":"Purpose: The purpose of the study is to model and simulate the trends and behavioral patterns in The Nigerian Stock Market and hence predict the future stock prices within the Geometric Brownian Motion (GBM) framework. \u0000Methodology: The methodology involves a comparison of forecasted daily closing prices to actual prices in order to evaluate the accuracy of the prediction model. Based on the model assumptions of the GBM with drift: continuity, normality and Markov tendency, the study investigated four years (2015 - 2018) of historical closing prices of ten stocks listed on The Nigerian Stock Exchange. The sample for this study is based on the most continuously traded stocks. \u0000Findings: The results show that in the simulation there are some actual stock prices located outside trajectory realization that may be from GBM model. Thus, the model did not predict accurately the price behavior of some of the listed stocks. The predictive power of the model is declining towards the longer the evaluated time frame proven by the higher value of the mean absolute percentage error. The value of the MAPE is 50% and below for the one- to two-year holding periods, and above 50% for the three-year holding period. \u0000Unique Contribution to theory, Practice and Policy: The MAPE and directional prediction accuracy method provide support that over short periods the GBM model is accurate. Meaning that the GBM is a reasonable predictive model for one or two years, but for three years, therefore, it is an inaccurate predictor. It is recommended that the technical analyst whose primary motive is to make gain at the expense of other participants should identify high volatile portfolio in any holding period for effective prediction Investors with long-range holding position as investment strategy should concentrate more on low capitalized stocks rather than stocks with large market capitalization. This is a unique contribution to theory, practice and policy.","PeriodicalId":53549,"journal":{"name":"International Journal of Banking, Accounting and Finance","volume":"72 1","pages":"1-35"},"PeriodicalIF":0.0,"publicationDate":"2021-08-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"84037979","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}
Purpose: The purpose of the study was to ascertain the relationship between options derivatives and financial performance of selected listed commercial banks in Kenya. Methodology: Descriptive research design was used when collecting data using closed ended questionnaires from the selected 11 listed commercial banks in Kenya. The target population included 156 respondents who were 25 risk managers, 53 operations managers, 33 credit managers and 45 marketing managers to participate in the study. The study selected all of the 156 respondents through census sampling technique. Pre-test questionnaires was sent to six respondents who were junior officers in risk, credit, operations and marketing departments of non-listed commercial banks in Meru Kenya. The collected data was then coded and analyzed quantitatively using the descriptive statistics such as mean, percentage and standard deviation while inferential statisticsperson correlation analysis were used. Linear regression models were also used. Further on, the tables, graphs were used when indicating the analysis results. Results: Options had a statistically significant relationship with financial performance. Most respondents agreed that there were clear procedures used to solve options price discrepancies. It had a mean of 4.79 and standard deviation of 0.62. However, most respondents disagreed that options derivatives market activities were improving in the banks. It had a mean of 3.85 and standard deviation of 1.05. The results further indicated that options had an R value of .793a and Durbin Watson value of 1.292 showing there was a strong correlation between the two variables, while the R-square was 0.629. This implied that options as a paradigm predicted 62.9% of financial performance variable in this study.Options also had a significant p-value of 0.018. Unique contribution to theory, policy and practice: The results indicated that commercial banks were really incurring more costs as compared to profits generated due to errors made by the employees when engaging in various options derivatives markets. In addition, when financial derivatives owners were given the rights and not forced to purchase or vend an underlying asset at a strike price or exercise price, at or earlier than the expiry date of the options, there was an above average purchase. The study recommends that the bank staff should explain full information on the options derivatives so that when a client is making the purchase, they are well knowledgeable. This knowledge should begin from the procedures followed when making a purchase, sale or transfer of option derivatives in the securities exchange market. In addition, any costs associated with the options derivatives should be fully communicated to clients priorly to avoid premature termination of options derivatives contracts. Further on, there should be more training on banks staffs by the bank management so that they are equipped with knowledge on the specifics of optio
{"title":"THE RELATIONSHIP BETWEEN OPTIONS DERIVATIVES AND FINANCIAL PERFORMANCE OF SELECTED LISTED COMMERCIAL BANKS IN KENYA","authors":"Philipino Muthine, Fredrick Mutea, R. Kanyaru","doi":"10.47941/IJF.610","DOIUrl":"https://doi.org/10.47941/IJF.610","url":null,"abstract":"Purpose: The purpose of the study was to ascertain the relationship between options derivatives and financial performance of selected listed commercial banks in Kenya. \u0000Methodology: Descriptive research design was used when collecting data using closed ended questionnaires from the selected 11 listed commercial banks in Kenya. The target population included 156 respondents who were 25 risk managers, 53 operations managers, 33 credit managers and 45 marketing managers to participate in the study. The study selected all of the 156 respondents through census sampling technique. Pre-test questionnaires was sent to six respondents who were junior officers in risk, credit, operations and marketing departments of non-listed commercial banks in Meru Kenya. The collected data was then coded and analyzed quantitatively using the descriptive statistics such as mean, percentage and standard deviation while inferential statisticsperson correlation analysis were used. Linear regression models were also used. Further on, the tables, graphs were used when indicating the analysis results. \u0000Results: Options had a statistically significant relationship with financial performance. Most respondents agreed that there were clear procedures used to solve options price discrepancies. It had a mean of 4.79 and standard deviation of 0.62. However, most respondents disagreed that options derivatives market activities were improving in the banks. It had a mean of 3.85 and standard deviation of 1.05. The results further indicated that options had an R value of .793a and Durbin Watson value of 1.292 showing there was a strong correlation between the two variables, while the R-square was 0.629. This implied that options as a paradigm predicted 62.9% of financial performance variable in this study.Options also had a significant p-value of 0.018. \u0000Unique contribution to theory, policy and practice: The results indicated that commercial banks were really incurring more costs as compared to profits generated due to errors made by the employees when engaging in various options derivatives markets. In addition, when financial derivatives owners were given the rights and not forced to purchase or vend an underlying asset at a strike price or exercise price, at or earlier than the expiry date of the options, there was an above average purchase. The study recommends that the bank staff should explain full information on the options derivatives so that when a client is making the purchase, they are well knowledgeable. This knowledge should begin from the procedures followed when making a purchase, sale or transfer of option derivatives in the securities exchange market. In addition, any costs associated with the options derivatives should be fully communicated to clients priorly to avoid premature termination of options derivatives contracts. Further on, there should be more training on banks staffs by the bank management so that they are equipped with knowledge on the specifics of optio","PeriodicalId":53549,"journal":{"name":"International Journal of Banking, Accounting and Finance","volume":"213 1","pages":"54-69"},"PeriodicalIF":0.0,"publicationDate":"2021-07-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"74996750","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}
Purpose: The study did an evaluation of cost-benefits of oyster mushroom production using innovative water hyacinth substrate for sustainable development of Sme, Kenya. Methodology: The study employed the Benefit-Cost Analysis (BCA) technique for the evaluation Findings: Oyster mushroom is edible and belongs to fungi Kingdom and can play a key role in economic development of a country. It can also contribute immensely to human wellness through enhancement of body immune system when consumed regularly. Unique contribution to theory, practice and policy There is need to evaluate the Cost-Benefits of Oyster Mushroom Production Using Innovative Water Hyacinth Substrate for Sustainable Development of SMEs in Kenya. Objectives include determination of economic Net present Value (ENPV) and determination of Economic Benefit-Cost Ratio (EBCR). The significance of this study include control of Corona Virus (COVID-19) pandemic disease, poverty reduction, reduction of unemployment crisis and enhancement of sustainable business opportunity for SME.
{"title":"EVALUATION OF COST-BENEFITS OF OYSTER MUSHROOM PRODUCTION USING INNOVATIVE WATER HYACINTH SUBSTRATE FOR SUSTAINABLE DEVELOPMENT OF SME, KENYA","authors":"M. Nelima, A. Nyakundi, J. Achoka","doi":"10.47604/IJFA.1310","DOIUrl":"https://doi.org/10.47604/IJFA.1310","url":null,"abstract":"Purpose: The study did an evaluation of cost-benefits of oyster mushroom production using innovative water hyacinth substrate for sustainable development of Sme, Kenya. \u0000Methodology: The study employed the Benefit-Cost Analysis (BCA) technique for the evaluation \u0000Findings: Oyster mushroom is edible and belongs to fungi Kingdom and can play a key role in economic development of a country. It can also contribute immensely to human wellness through enhancement of body immune system when consumed regularly. \u0000Unique contribution to theory, practice and policy There is need to evaluate the Cost-Benefits of Oyster Mushroom Production Using Innovative Water Hyacinth Substrate for Sustainable Development of SMEs in Kenya. Objectives include determination of economic Net present Value (ENPV) and determination of Economic Benefit-Cost Ratio (EBCR). The significance of this study include control of Corona Virus (COVID-19) pandemic disease, poverty reduction, reduction of unemployment crisis and enhancement of sustainable business opportunity for SME.","PeriodicalId":53549,"journal":{"name":"International Journal of Banking, Accounting and Finance","volume":"1 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-07-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78567945","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 : 2021-04-23DOI: 10.1504/ijbaaf.2021.116190
I. Song
This paper examines the association between property-casualty insurer accruals quality and analysts' earnings forecasts (i.e., accuracy and dispersion of forecasts). Using insurer-specific accruals, loss reserves, we calculate accruals quality which can be decomposed into its innate and discretionary components. Our results provide evidence that higher accruals quality - as measured by lower standard deviation of loss reserve errors - is positively associated with analysts' forecast accuracy. In other words, our results suggest that analysts provide less accurate forecasts for firms with higher reserve error volatility. Also, we show that lower accruals quality is associated with higher forecast dispersion indicating more disagreement among analysts. Our results hold consistent with decomposed components of accruals, innate and discretionary, and conclude that both managerial discretion and basic operations of firms affect insurers analysts' earnings forecasts.
{"title":"Accruals quality and analyst forecast accuracy: evidence from the property-casualty insurance industry","authors":"I. Song","doi":"10.1504/ijbaaf.2021.116190","DOIUrl":"https://doi.org/10.1504/ijbaaf.2021.116190","url":null,"abstract":"This paper examines the association between property-casualty insurer accruals quality and analysts' earnings forecasts (i.e., accuracy and dispersion of forecasts). Using insurer-specific accruals, loss reserves, we calculate accruals quality which can be decomposed into its innate and discretionary components. Our results provide evidence that higher accruals quality - as measured by lower standard deviation of loss reserve errors - is positively associated with analysts' forecast accuracy. In other words, our results suggest that analysts provide less accurate forecasts for firms with higher reserve error volatility. Also, we show that lower accruals quality is associated with higher forecast dispersion indicating more disagreement among analysts. Our results hold consistent with decomposed components of accruals, innate and discretionary, and conclude that both managerial discretion and basic operations of firms affect insurers analysts' earnings forecasts.","PeriodicalId":53549,"journal":{"name":"International Journal of Banking, Accounting and Finance","volume":"1 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-04-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42925628","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 : 2021-04-23DOI: 10.1504/ijbaaf.2021.116189
Mohamed Chakroun, M. Gallali
This study aims to identify the risk factors amplifying the contagion risk between the Islamic to conventional banks. Using the copula approach and the panel VAR model, findings justify the presence of a dependent relationship between the two types of banks, where the sense of causality of this phenomenon is unidirectional derived from conventional to Islamic banks. Hence, our results indicate that the market risk, the credit risk and the size of the financial institution represent the major factors triggering the contagion risk between both types of banks. To this extent, Islamic banks should consider more restricted standards to be able to ensure their independence and to handle their contagion risk.
{"title":"Dependence between Islamic banks and conventional banks and risk factors","authors":"Mohamed Chakroun, M. Gallali","doi":"10.1504/ijbaaf.2021.116189","DOIUrl":"https://doi.org/10.1504/ijbaaf.2021.116189","url":null,"abstract":"This study aims to identify the risk factors amplifying the contagion risk between the Islamic to conventional banks. Using the copula approach and the panel VAR model, findings justify the presence of a dependent relationship between the two types of banks, where the sense of causality of this phenomenon is unidirectional derived from conventional to Islamic banks. Hence, our results indicate that the market risk, the credit risk and the size of the financial institution represent the major factors triggering the contagion risk between both types of banks. To this extent, Islamic banks should consider more restricted standards to be able to ensure their independence and to handle their contagion risk.","PeriodicalId":53549,"journal":{"name":"International Journal of Banking, Accounting and Finance","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-04-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44149748","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 : 2021-04-23DOI: 10.1504/ijbaaf.2021.10037347
D. Anastasiou, Konstantinos Drakos
Given that lenders and borrowers interact in the same (credit) market, an interesting research question that arises is whether the demand side of the market correctly comprehends the actual credit market conditions that are primarily shaped by the supply side. We explore this by utilising available surveys conducted separately for the two sides of the credit market and empirically investigate whether, and by which mechanism, demand-side perceptions relate to supply-side credit conditions. Our results indicate that demand-side perceptions do not match one-for-one supply-side conditions, but are rather described by an adaptive mechanism. This mechanism suggests that demand-side perceptions are modified every period by a fraction of the last period's perception error. Additionally, we find that demand-side perceptions systematically overshoot the actual conditions, and this overshooting is accentuated for periphery countries and smaller firms.
{"title":"Borrowers' perceptions of lending conditions: worlds apart or closer than close","authors":"D. Anastasiou, Konstantinos Drakos","doi":"10.1504/ijbaaf.2021.10037347","DOIUrl":"https://doi.org/10.1504/ijbaaf.2021.10037347","url":null,"abstract":"Given that lenders and borrowers interact in the same (credit) market, an interesting research question that arises is whether the demand side of the market correctly comprehends the actual credit market conditions that are primarily shaped by the supply side. We explore this by utilising available surveys conducted separately for the two sides of the credit market and empirically investigate whether, and by which mechanism, demand-side perceptions relate to supply-side credit conditions. Our results indicate that demand-side perceptions do not match one-for-one supply-side conditions, but are rather described by an adaptive mechanism. This mechanism suggests that demand-side perceptions are modified every period by a fraction of the last period's perception error. Additionally, we find that demand-side perceptions systematically overshoot the actual conditions, and this overshooting is accentuated for periphery countries and smaller firms.","PeriodicalId":53549,"journal":{"name":"International Journal of Banking, Accounting and Finance","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-04-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43138174","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}
Purpose: The objective of the study was to investigate the duplicity in regulation and performance of the financial sector in Kenya. The specific objectives were; to review and identify regulation duplication/competition in existing regulatory framework for the financial sector in Kenya; to describe how regulatory effectiveness has been measured in empirical literature; to assess whether the current regulatory structure has affected the performance of the financial sector in Kenya and lastly to suggest potential ways of enhancing regulatory effectiveness in Kenya. Methodology: The paper used a desk study review methodology where relevant empirical literature was reviewed to identify main themes and to extract knowledge gaps. Findings: The study found out that financial sector in Kenya and other developing economies have reported losses on a large scale due to under regulation and regulator duplicity. Some of these have become insolvent, or have had to be taken over or rescued by their governments. A single market regulator clearly has its own advantages over multiple regulators. But it is more suitable for well-developed and mature markets which are smaller in size, like the UK. The study also found out that Kenya’s economy and political arena are not mature enough to handle a single financial market regulator. In this light it can be asserted that even mature economies such as the United States still have multiple regulators. Unique contribution to theory, practice and policy: Adherence to principles of open government, including transparency and participation in the regulatory process to ensure that regulation serves the public interest and is informed by the legitimate needs of those interested in and affected by regulation. Governments should ensure that regulations are comprehensible and clear and that parties can easily understand their rights and obligations. Organizations should create personalized technology systems that create a demand adaptation of ICT at every level of the organizational operations
{"title":"DUPLICITY IN REGULATION AND PERFORMANCE OF THE FINANCIAL SECTOR IN KENYA","authors":"Dr.Agnes Ogada","doi":"10.47941/IJF.553","DOIUrl":"https://doi.org/10.47941/IJF.553","url":null,"abstract":"Purpose: The objective of the study was to investigate the duplicity in regulation and performance of the financial sector in Kenya. The specific objectives were; to review and identify regulation duplication/competition in existing regulatory framework for the financial sector in Kenya; to describe how regulatory effectiveness has been measured in empirical literature; to assess whether the current regulatory structure has affected the performance of the financial sector in Kenya and lastly to suggest potential ways of enhancing regulatory effectiveness in Kenya.\u0000Methodology: The paper used a desk study review methodology where relevant empirical literature was reviewed to identify main themes and to extract knowledge gaps.\u0000Findings: The study found out that financial sector in Kenya and other developing economies have reported losses on a large scale due to under regulation and regulator duplicity. Some of these have become insolvent, or have had to be taken over or rescued by their governments. A single market regulator clearly has its own advantages over multiple regulators. But it is more suitable for well-developed and mature markets which are smaller in size, like the UK. The study also found out that Kenya’s economy and political arena are not mature enough to handle a single financial market regulator. In this light it can be asserted that even mature economies such as the United States still have multiple regulators.\u0000Unique contribution to theory, practice and policy: Adherence to principles of open government, including transparency and participation in the regulatory process to ensure that regulation serves the public interest and is informed by the legitimate needs of those interested in and affected by regulation. Governments should ensure that regulations are comprehensible and clear and that parties can easily understand their rights and obligations. Organizations should create personalized technology systems that create a demand adaptation of ICT at every level of the organizational operations","PeriodicalId":53549,"journal":{"name":"International Journal of Banking, Accounting and Finance","volume":"110 1","pages":"39-53"},"PeriodicalIF":0.0,"publicationDate":"2021-04-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87599361","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}
Purpose: The study sought to establish the effects of blockchain technology on the performance of financial markets in Kenya. Methodology: The study adopted an explanatory research design. The study target population was drawn from the commercial banks located in Nairobi County, Kenya. The study targeted 84 bank managers in the IT and finance department of the 42 commercial banks in Kenya. Thus the target population of the study was 84 financial market managers selected. The study population was grouped into simple identifiable group called strata and adopted a stratified simple random sampling technique with inclusion of commercial banks. A sample size of a sample size of 50 respondents was arrived at. Data was collected using a structured questionnaire. The data collected was cleaned and coded, quantified and analyzed quantitatively. Quantitative data were analyzed using SPSS 24 where descriptive and inferential statistics were used to capture the data in order to understand the pattern and nature of relationships. Results were presented using tables. Findings: The study findings showed that the correlation analysis showed that the adoption of blockchain technology had a positive and significant correlation to government policy R = 0.240. Adoption of blockchain technology had a positive and significant correlation to internet infrastructure by R = 0.293. Adoption of blockchain technology had a positive and significant correlation to transaction cost at R = 0.583. Lastly, adoption of blockchain technology had a positive and significant correlation to risk analysis at R = 0.507. Unique contribution to theory, practice and policy: The study recommended that there should be policy review on issues relating to risk analysis so as to curb illegal money transfers and enhance performance of financial markets in Kenya. The study recommends for a thorough scrutiny by the government and ensures such issues are keenly analyzed to help bring peace and stability in the world. The aspect of having good internet connectivity is beneficial to the nation in that access to proper information will be available and it enables many users to have wide access to services as well as creation of employment. There is need to conduct a study on stability of blockchain technologies use and their impact to the economic growth. The study incorporated Technology Acceptance Model and Innovation Diffusion Theory to link the study topic to the concepts
{"title":"EFFECTS OF BLOCKCHAIN TECHNOLOGY ON PERFORMANCE OF FINANCIAL MARKETS IN KENYA","authors":"Sarah Aketch, Felix G. Mwambia, Bernard Baimwera","doi":"10.47604/IJFA.1237","DOIUrl":"https://doi.org/10.47604/IJFA.1237","url":null,"abstract":"Purpose: The study sought to establish the effects of blockchain technology on the performance of financial markets in Kenya. Methodology: The study adopted an explanatory research design. The study target population was drawn from the commercial banks located in Nairobi County, Kenya. The study targeted 84 bank managers in the IT and finance department of the 42 commercial banks in Kenya. Thus the target population of the study was 84 financial market managers selected. The study population was grouped into simple identifiable group called strata and adopted a stratified simple random sampling technique with inclusion of commercial banks. A sample size of a sample size of 50 respondents was arrived at. Data was collected using a structured questionnaire. The data collected was cleaned and coded, quantified and analyzed quantitatively. Quantitative data were analyzed using SPSS 24 where descriptive and inferential statistics were used to capture the data in order to understand the pattern and nature of relationships. Results were presented using tables. Findings: The study findings showed that the correlation analysis showed that the adoption of blockchain technology had a positive and significant correlation to government policy R = 0.240. Adoption of blockchain technology had a positive and significant correlation to internet infrastructure by R = 0.293. Adoption of blockchain technology had a positive and significant correlation to transaction cost at R = 0.583. Lastly, adoption of blockchain technology had a positive and significant correlation to risk analysis at R = 0.507. Unique contribution to theory, practice and policy: The study recommended that there should be policy review on issues relating to risk analysis so as to curb illegal money transfers and enhance performance of financial markets in Kenya. The study recommends for a thorough scrutiny by the government and ensures such issues are keenly analyzed to help bring peace and stability in the world. The aspect of having good internet connectivity is beneficial to the nation in that access to proper information will be available and it enables many users to have wide access to services as well as creation of employment. There is need to conduct a study on stability of blockchain technologies use and their impact to the economic growth. The study incorporated Technology Acceptance Model and Innovation Diffusion Theory to link the study topic to the concepts","PeriodicalId":53549,"journal":{"name":"International Journal of Banking, Accounting and Finance","volume":"23 1","pages":"1-15"},"PeriodicalIF":0.0,"publicationDate":"2021-03-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"86665747","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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