Presence Of Banks Research Articles

Banking on distant shores: a comparison of the development of foreign banks in pre-World War I China and Japan

Abstract This article provides the first in-depth systematic comparison of foreign banking in pre-World War I China and Japan. As the article shows, after their entry into China and Japan, the presence and activities of foreign banks in China and Japan differed markedly, with these banks developing a much more prominent position in China. Making use of sources in German, English, Chinese, and Japanese, this article aims to explain why foreign banks in China and Japan developed so differently before World War I. It does so by first providing an overview of the development of foreign banks in both countries and then discussing their activities and development with regards to Chinese and Japanese financial institutions, trade finance, and public finance. The article shows that it was Japan's emphasis on financial reforms that led to the limited presence of foreign banks in that country.

Local credit and international trade

AbstractThis study investigates the relationship between local access to credit and exports. A model of finance‐constrained exporters and bank entry decisions generates trade equations that we estimate with a panel of Brazilian municipal‐level trade and banking data. Literature in the financial development field has struggled to deal with the endogenous relationship between finance and economic outcomes. To untangle this reverse causality, we instrument bank presence by using geographic characteristics particular to the bank branching decision. The results show that local bank access matters: increases in bank branches per person increases bilateral exports and varieties at the city‐ and industry levels. The effect is even stronger for industries where the credit constraint binds, specifically those that use less internal funds and have more difficulty producing collateral.

Unexpected and Extraordinarily Shallow Coralligenous Banks at the Sinuessa Site, a Heritage of the Campania Coast (SW Italy, Mediterranean Sea)

Coralligenous bioconstructions are biogenic calcareous formations developing at low irradiance on littoral rocky cliffs or on the deeper sub-horizontal bottom in the Mediterranean Sea. Unusually shallow coralligenous banks on the sandy coast of Sinuessa (Mondragone City, Gulf of Gaeta, SW Italy) were investigated. Their communities and the surrounding biogenic detritus were characterized. Geophysical and acoustic data revealed the presence of coralligenous banks between 7.5 and 15 m depth, showing constant thickness and sub-horizontal geometry, incised by sub-perpendicular channels. Sediment deposits ranging from silty sands to bioclastic gravel occur in the area. The biogenic detritus of the soft bottom sampled around the coralligenous banks is highly heterogeneous. Through the thanatocoenosis analysis of macrozoobenthos, different biocenoses were detected, among which the coralligenous and photophilic habitats are mainly represented, followed by the well-calibrated fine sands and the relit sands. A total of 16 different species and 10 epimegabenthic morphological groups (MGs) were detected on the coralligenous banks, of which 4 are included in European regulation for threatened species. The density of epimegabenthic organisms has an average of 10.34 ± 5.46 individuals or colonies/100 m2. Cladocora caespitosa is the dominant species, with a height of 17 ± 5 cm. This and other structuring species (SS) were larger in size in the sampled sites than in the literature data. Overall, coralligenous had a “medium” health status, with 52% of the individuals or colonies in healthy conditions, compared to 47% with epibiosis phenomena and 1% with entanglement. Longlines were the most common anthropogenic litter, with a density of 2/100 m2. Ad hoc monitoring programs and conservation measures would be desirable to protect and guarantee the well-being of these sensitive and rare shallow bioconstructions.

The Role of Innovation in the Competition Between Fintechs and Traditional Banks in Brazil

The Brazilian banking market has distinct and peculiar characteristics, resulting from its historical evolution, specific cultural traits and control exercised by the Central Bank. This article aims to analyze, from the perspective of one of the largest Brazilian banks, the role of innovation, products and processes, in the competition between fintechs and traditional banks. The methodology used was a single case study, qualitative and descriptive approach, with data collection through interviews with managers and customers of Alfa Bank and internal and external documentary survey. It has been evident that the emergence of Fintechs, with its flexible business model, with reduced operational costs, provided by product and process innovation, impacted the banking market in Brazil, traditionally dominated by a small number of large banks, which operated in a traditional way. The analyzed bank, known as Alfa, follows technological developments and improves its main products and services, taking into account suggestions from both employees and customers. The results also showed that Brazilian customers recognize the importance of innovation, especially technology-based, but also value the physical presence of traditional banks, which inspires more confidence in them than Fintechs, which operate online.

Exploring Trends in Financial Performance Metrics: An In-Depth Study of Nepalese Banks Over the Past Decade

This study investigates the trends in Return on Assets (ROA) and Return on Equity (ROE) within Nepalese banks over the past decade, while also assessing the growth of banking infrastructure, including branches, ATMs, and card usage. Utilizing a descriptive and correlational research design, secondary data spanning from fiscal years 2070/71 to 2079/80 was analyzed, drawing on monthly records from 20 commercial banks to yield 2,400 observations. Data was collected from annual reports, the Nepal Rastra Bank, the Central Bureau of Statistics, and economic surveys. Results revealed a significant initial rise in both ROA and ROE, indicating robust profitability, followed by notable declines that suggest underlying structural weaknesses in the banking sector. The expansion of banking infrastructure was substantial, with a marked increase in branches and ATMs between 2074 and 2075, positively correlating with financial performance indicators such as total deposits and loans. The study concludes that enhancing banking infrastructure is crucial for improving financial stability and performance in Nepal's banking sector. The findings highlight the interconnectedness of physical banking presence and financial health, emphasizing the need for strategic reforms. The novelty of this research lies in its comprehensive analysis of the relationships between banking metrics and financial outcomes in the Nepalese context, providing valuable insights for policymakers and financial institutions aiming to navigate current challenges and foster sustainable growth.

The Legal Position of the Indonesian Ulema Council in Applying the Principles of Islamic Law in Islamic Banking Operations in Indonesia

National economic development through the establishment of Islamic Banks is an implementation of Article 29 of the 1945 Constitution of the Republic of Indonesia. The presence of Islamic Banking in the national economy is a strategic legal policy of the government because its operations are based on the principles of Islamic law, namely principles derived from the Qur'an, Hadith, Ijma', and Qiyas. However, in its application, these principles of Islamic law are manifested in the form of fatwas issued by the National Sharia Council-Indonesian Ulema Council (DSN-MUI) as a source of positive law for Islamic banking. Therefore, this study raises legal issues related to the legal position of the Indonesian Ulema Council in the application of sharia principles to Islamic Banking operations in Indonesia. This study aims to analyze and determine the legal position of the Indonesian Ulema Council in the application of sharia principles to Islamic Banking in Indonesia. The research method used is normative research, which provides answers to the problems raised with the perspective of what should be done. The results of the study indicate that the DSN-MUI fatwa has a crucial role as a positive legal basis in the operation of Islamic Banking in Indonesia, although formally it is not a statutory regulation. The implications of this study indicate the importance of recognizing and strengthening the role of the DSN-MUI in the national legal system to ensure compliance of Islamic Banking operations with applicable sharia principles.

Disentangling the impact of foreign bank presence on domestic banks performance: Does the degree of foreign ownership in domestic banks matter?

While extant studies typically measure foreign bank presence only considering the percentage share of foreign-owned banks among the banking industry of one country, there comes one interesting question: whether the impact of the micro-level foreign presence, i.e. foreign investment in domestic banks, may be similar? Drawing on theoretical arguments from FDI spillover and corporate governance, this paper hypothesizes that macro-level foreign bank presence mainly threatens domestic banks’ performance due to increased competition, whereas micro-level foreign presence enhances banks’ efficiency. Empirical analyses based on a cross-country bank-level dataset from 2002 to 2020 support these hypotheses. The mechanism analysis shows that macro-level foreign presence hampers domestic banks’ outputs, while micro-level foreign presence helps reduce banks’ input prices. Furthermore, the impact of macro-level foreign presence is more pronounced in less developed economies, while the positive impact of micro-level foreign presence is significant in more developed economies or those with low banking concentration. Our findings enrich the literature on foreign bank presence by considering micro-level foreign investment in domestic banks, and expand the FDI and corporate governance literature by incorporating the banking context.

Bank Sampah Graha Sewaka Dharma sebagai Alternatif Pengelolaan Sampah Perkantoran di Kawasan Pemerintahan Kota Denpasar

Purpose: This research provides an alternative strategy in waste management by educating employees through the Graha Sewaka Dharma (GSD) waste bank in the Denpasar City Govermance area in Lumintang which is integrated with the 4R principles. Research methods: This research uses qualitative methods with observation and documentation data collection. The researchers use SWOT analysis (strengths, weaknesses, opportunities and threats) so that it solutions or alternative policy strategies can be found in managing office waste at the GSD Waste Bank. Results and discussion: The presence of the GSD waste bank is able to provide education on sorting waste, raising awareness among employees about collecting waste in a timely manner. Apart from that, employees who hand over waste will receive additional income which can be used for shopping at the Dharma Wiguna Cooperation. Implications: The existence of the GSD waste bank which is integrated with education regarding 4R principles provides basic knowledge for employees to manage waste from its source, namely households and office areas, empowering employees to have knowledge and skills so they are able to sort organic and non-organic waste.

Bridging the credit gap: The influence of regional bank structure on the expansion of peer-to-peer lending

This paper investigates the extent to which the regional credit market structures, characterized by the presence and lending capacity of traditional banks, shape the growth of online lending marketplaces using peer-to-peer (P2P) lending data. Using an instrumental variables (IV) approach, our study suggests that areas underserved by traditional banks witness more significant growth in P2P lending. This impact is more pronounced in regions with a lower presence of small bank outreach. Furthermore, we find that an increase in P2P lending is associated with a reduced risk of borrower default. Our findings also show that the expansion of online lending marketplaces positively impacts borrowers’ financial well-being by improving their credit scores.

Wadiah Savings Fund Strategy and Bank Products at Bank Syariah Indonesia

This study aims to find out about the development of Islamic banks in Indonesia. This research is qualitative descriptive. This study included literature to examine the written sources such as scientific journals, books referesni, literature, encyclopedias, scientific articles, scientific papers and other sources that are relevant and related to the object being studied. As for the object of study of this research is in the form of texts or writings that describe and explain about the development of Islamic banks in Indonesia. Results from this study is Indonesian banking now enlivened by the presence of Islamic banks, which offers financial products and investment in a different way than conventional banks, as Indonesia is the largest Muslim country in the world. The development of Islamic banking in Indonesia has become a benchmark for the success of the Islamic economic existence. Bank Muamalat as the first Islamic bank and a pioneer for other Islamic banks in Indonesia.

Cross-border banking and bank stability: evidence from Sub-Saharan Africa

AbstractBased on bank-level data from 29 Sub-Saharan African countries between 2005 and 2019, we apply panel fixed effects (FE) and two-step system GMM estimators to investigate whether increased cross-border banking affects domestic banking sector stability. We find significant evidence that the stability of banks in host countries declines with an increased presence of foreign banks—and the impact is more pronounced on banks that are small and less efficient. The stability impact of foreign banks is also found to depend on the quality of governance institutional factors in the host country. The findings shed some important insights on the downside of financial liberalisation policy in developing countries and the need for increased cross-border collaboration between home and host supervisory authorities in the SSA region—especially in jurisdictions where the foreign bank affiliates are systemically important. The domestic supervisory authorities thus need to effectively manage the inherent trade-off between reaping the benefits from international financial integration while effectively safeguarding domestic banking systems against cross-border contagion and fragility.

Determinan Penggunanan Digital Banking Pada Generasi Y Dan Generasi Z Muslim Di Kota Banda Aceh

The development of information technology has given a new face to the financial and banking industry, such as the presence of digital banks. Implementation of Aceh Qanun Number 11 of 2018 concerning Sharia Financial Institutions (LKS) also does not become an obstacle for digital banking, because digital banks do not require physical services to carry out their activities. Currently, more than 90% of digital banks in Indonesia use conventional systems. The movement in the development of digital banks has shown quite significant growth in Indonesia, especially during the Covid-19 pandemic when demands for physical meetings were implemented. This research aims to look at the determinants of digital bank use among generations Y and Z Muslims in Banda Aceh City by analyzing the relationship between eight independent variables, namely economic value, ease of use, social influence, company reputation, promotion, features, curiosity and appreciation. The population in this research is all generations Y and Z Muslims in Banda Aceh City who have used digital banking services for at least 4 months. The sample used was 100 people using a purposive sampling technique. Data was collected by distributing questionnaires using a Likert scale instrument, which was then analyzed using multiple linear regression analysis techniques. The research results show that all variables except the sales promotion and curiosity variable have a significant effect on the intention to use digital banking in the city of Banda Aceh. Keywords : Digital Banking, Generation Y and Generation Z

Foreign bank presence and income inequality in Africa: What role does economic freedom play?

This study contributes to income equality (IE) literature by examining four important issues. First, the study examines the effects of foreign bank presence (FBP) on IE. Second, the paper identifies the minimum threshold level of FBP which can lead to IE. Third, the effect of economic freedom on IE was investigated. Fourth, the paper determines whether economic freedom interacts with FBP to minimise IE. The findings are based on macro data for 33 African countries from 1995 to 2020. The findings from the two-stage system generalised method of moment indicate that unconditionally, FBP reduces income inequality. Also, results from the threshold effect reveal that whilst FBP reduces income inequality, if it exceeds 52%, it may contribute to it. Additionally, the study reveals that economic freedom dampens IIE. Furthermore, economic freedom conditions FBP to reduce IE. Based on these findings, policymakers are advised to exercise caution in attracting foreign banks and to promote local financial institutions. Policymakers are also advised to implement policies to promote economic freedom.

The Legal Implications of Establishing Land Bank As An Entity Authorized to Manage Land

Land is an important resource that controls the livelihoods of many people. Land has social, economic, cultural and even spiritual value. The presence of the state based on Article 33 paragraph (3) of the 1945 Constitution of the Republic of Indonesia (UUD NRI 1945) is to regulate land allocation in a fair manner. This is also stated in the UUPA. However, since the presence of the Land Bank, it has actually triggered problems, especially in the normative order, in this case what is highlighted is the conflict of norms. Leads to two problem formulations. First, what is the essence of the Land Bank's regulation as a body that is given the authority to manage land? Second, what are the legal implications of regulating the Land Bank as a body given the authority to manage land? Using normative legal research methods, with a statutory statute approach and theoretical approach. The resulting analysis shows that the current Land Bank regulations in Law no. 6 / 2023 in conjunction with PP No. 64 / 2021, turns out to have closer economic nuances. This also shows a lack of harmony with Article 33 paragraph (3) of the 1945 Constitution of the Republic of Indonesia, UUPA and the objectives of agrarian reform. This regulation has legal implications, both philosophically, normatively and sociologically. Therefore, it is necessary to evaluate and reorganize Land Bank regulations in Indonesia so that they provide legal certainty and more equitable use.

How Does Fintech Lending Affect Islamic Local Banks' Efficiency During COVID-19 Pandemic in Indonesia?

Fintech lending, also known as peer-to-peer (P2P) lending or online loans, refers to lending provided by non-bank financial technology-based companies that provide financial services by connecting lenders and borrowers on a specific online platform. This paper investigates the impact of fintech lending development on the efficiency of Islamic local banks in Indonesia. Local banks are chosen because they differ from national commercial banks in terms of their characteristics and products, and they also serve limited customers in a specific local area (i.e., provincial level). The presence of Islamic local banks in Indonesia is unique because it fills the gap and has a significant contribution to Muslims who do not have (or do not need) access to larger Islamic commercial banks. This is particularly noteworthy given that Indonesia is the most populous Muslim country. Using a sample of 161 Islamic local banks in Indonesia and provincial-level fintech lending data from 2020Q1 to 2020Q4, we find that fintech development in Indonesia erodes Islamic local banks’ efficiency, suggesting that their presence is significant and could also be damaging for local banks. However, our finding reveals that the negative effects of fintech development can be reduced in banks with higher levels of efficiency. Our results call for policymakers to monitor the development of fintech to maintain a lending ecosystem that can ultimately relate to financial service stability.

Financial market discipline on bank risk: Implications of state ownership

This study investigates the link between capital market discipline and bank-level credit risk with a special emphasis on the role of bank ownership structure. Focusing on a large emerging market, Türkiye, characterized by a prominent state bank presence, our baseline regression results indicate that banks' stock price volatility elevates in response to the increases in non-performing loan ratio for the period 2008–2021. More importantly, the extent of capital market discipline on credit risk is amplified for state-owned banks. This finding remains similar against a myriad of robustness checks. To analyze the implications on alternative financial markets, we further extract high-frequency implied volatility measures from options contracts recently traded on individual bank stocks. By utilizing the Covid-19 outbreak as an exogenous shock to local banks’ loan portfolio quality, we perform difference-in-differences estimations for the interval of October 2019–June 2020. Our findings show that the implied volatility for non-private banks increases more in the post-shock phase compared to other bank ownership types.

SMEs and financial dependence: how important are foreign banks?

PurposeThe importance of financial dependence of small and medium enterprises (SMEs) on their performance is a relatively unaddressed area of research. Relatedly, whether and to what extent foreign bank penetration exerts an impact in the presence of financial dependence also remains an open question. The purpose of the paper in this regard is to exploit unit-level data on Indian SMEs and assess the independent and interactive effects of financial dependence on SME behaviour, in the presence of foreign banks.Design/methodology/approachThis study uses fixed effects specification to address the issue. In subsequent analysis, this study also uses an instrumental variable approach for robustness.FindingsThe results indicate that financial dependence improves investment and employment, although there is a decline in productivity. These findings differ across size classes of SMEs. Similar is the evidence in the presence of foreign banks. In particular, foreign bank penetration leads to a decline in investment for micro and medium SMEs, although for small SMEs, the impact is found to be the opposite.Originality/valueTo the best of the author’s knowledge, this is one of the early within-country studies to examine the interface between SMEs and financial dependence and the role played by foreign banks in this regard.

Bank ownership, credit supply volatility, and macroeconomic volatility

We examine the real effects of credit supply volatility in emerging economies. In countries with highly effective governments, government-owned banks play a significant role in reducing the effect of credit supply volatility on macroeconomic volatility. Conversely, foreign banks do not significantly change this effect. Furthermore, the presence of government-owned banks as development banks plays a positive role in stabilizing the economy during a sovereign or currency crisis. In countries where foreign banks dominate the banking sector, these banks amplify the adverse effect of a volatile credit supply on the volatilities in output, consumption, and investment growth rates, especially during a banking crisis.

Islam, Islamic Banking and Entrepreneurship: Evidence from OIC Member Countries

There is a view that Islam hinders entrepreneurship in Muslim societies in general. Unfortunately, there is little empirical work testing the negative effect of Islam as a religion on entrepreneurship. In an attempt to fill this gap, this study aims to reassess this effect in OIC member countries. Specifically, the aim is to assess whether Islam is an impediment to entrepreneurship in these countries and whether the presence of Islamic banking institutions in these countries strengthens or moderates such a relationship. Using multivariate regression analysis, the results indicate that there is indeed a negative relationship between Islam and entrepreneurship in OIC countries where Islamic banking is absent. But, this relationship does not hold where Islamic banking exists. Indeed, the presence of Islamic banks in countries where Islam is the state religion cancels out any negative effect of Islam and has a positive effect on entrepreneurship in the country concerned. The results of this study thus reopen the debate on whether Islam as a religion discourages competition, innovation, entrepreneurship and economic development compared to other religions.

Inter-firm relationships and the special role of common banks

Using a novel dataset that combines information on customer-supplier trade relationships with information on firm-bank lending relationships, we show that common banks that lend to firms at both ends of a trade link grow and strengthen such trade relationships. To establish causality, we use bank mergers, which generate exogenous variations in the presence of common banks, and show that common bank relationships between customers and suppliers increase trade relationships by 49.6%. We find that the role of a common bank is greater when it is more informed and when supply chains suffer from larger information and holdup problems. We also document that suppliers with common banks face lower spillover risks from a distressed customer. Overall, our findings show the unique role of banks in driving inter-firm growth and investment by mitigating information and holdup problems, which arguably leads to greater economic growth.