Corporate Banking Research Articles

Pengaruh Faktor Internal Bank dan Makroekonomi Terhadap Prediksi Krisis Perbankan Syariah di Indonesia Dengan Menggunakan CD Indeks Periode 2016 – 2020

Abstract The purpose of this study is to analyze the Bank's volatility in the face of the banking crisis in the period 2016-2020. This type of research is a type of quantitative research. Research design using kausal research. The population in this study is Indonesia's corporate banking sector in 2016-2020. A sample of 11 banks has published financial reports in 2016-2020. The data analysis technique used in this study is logistical regression analysis and with Crisis and Default Index measurements. The results of the analysis of the data in this study are that there is a negative impact of capital practised by the Capital Adequacy Ratio on the banking crisis. There is no negative impact of asset quality practised by the Non Performing Fund on the banking crisis. There is no positive impact of Management on the banking crisis. There's a negative effect of Earning being practised with Return On Assets on the banking crisis. There is a positive impact of liquidity that is practised with Loan to Deposit Ratio on the banking crisis. There's a negative impact of Sensitivity to Market Risk on the banking crisis. There is a negative impact of the economic growth of the Rile on the banking crisis. There is a positive impact of inflation on the banking crisis.

Risk Management in Lending based on Assets of Small and Medium Enterprises

Bank lending to small and medium-sized enterprises is an established and integral element of Russia's market economy. Over the past three years there has been a positive trend in the development of bank corporate lending, including the introduction into national practice of a new form of asset-based lending (ABL). Scientific works of Russian and foreign economists and lawyers were used as materials for the study. The study was based on the statistical database of the Central Bank of the Russian Federation and the statistics of the national project «Small and Medium Entrepreneurship and Support of Individual Entrepreneurial Initiative». We used general methods of scientific knowledge: methods of empirical (comparison, observation) and theoretical (analysis, synthesis) research to study the main indicators of the lending (financing) market for small and medium enterprises (the dynamics of the volume of loans, the dynamics of the number of loans, the dynamics of the number of SMEs receiving credit, the dynamics of debt on loans granted to SMEs, including overdue). The applied research methods allowed us to analyze the SME lending market and identify the main factors affecting the SME lending market in Russia - high interest rates, as well as the growth of overdue loans. Share of overdue loans has averaged 10-15% in different reporting months over the past two years (the analyzed period from April 2019 to April 2021). This study examines current trends in lending to SMEs in Russia, especially the emergence of ABL, which have been underrepresented in recent literature. Recommendations are developed to increase the share of asset-based lending, as well as to increase its volume. The materials of the study can be useful to scholars dealing with this issue, government regulators, as well as commercial banks (including banks with state participation) and factoring finance companies.

Information Selection in Default Prediction: Sri Lankan Bankers’ Perspectives

This study aims to ascertain the perceptions of bankers in Sri Lanka of the different default predictor information and the prediction performances. In semi-structured interviews, twenty-three credit risk and corporate banking managers from 26 banks in Sri Lanka were surveyed on their perceptions towards the application of accounting, share market and corporate governance information in corporate default prediction. The study follows mixed research design and uses semi-structured interviews to collect information of default prediction. Thematic analysis and t-tests were used to analyse the data. All the previous studies on corporate default prediction adopted quantitative methods to examine the role of different predictor information. This study contributes to the literature on redefining and realigning the corporate default prediction models with empirical quantitative findings. The results indicate that bankers in Sri Lanka have a generally positive perception of accounting information. They perceive governance information as being critical for credit decisions. However, no decisions are made using governance information. The majority of the bankers voiced negative perceptions about applying market information to their default prediction models. Further, bankers limit their default prediction models by devaluing or misunderstanding the role of different predictor information when making corporate lending decisions.

Linking Sharia Bank Corporate Image and Customer Trust with Customer Switching Intention: The Mediating Role of Customer Loyalty

Good service from a bank will be an added value to improve the company's image and is directly proportional to customer loyalty. Customer loyalty can prevent customers from switching to using services from other companies. This study aims to examine the role of the mediating variable, customer loyalty, which relates to the effect of company image and trust on customer intention to switch. The object of this research is the customer of Bank Muamalat Indonesia. After reviewing the literature and formulating hypotheses, the data collected through the questionnaire method were 213 respondents from Bank Muamalat Indonesia customers. The sampling applied the convenience sampling technique. The data obtained were then analyzed using Structural Equation Modeling (SEM), while the hypothesis test used the Smart-PLS 3.0 application. This study indicates that loyalty can fully mediate the influence of company image and trust on switching intention. Creating loyalty means building customer image and trust as a company investment in the long term. Managers need to build corporate image and customer trust to compete in Indonesia's financial industry.

Pengaruh Non Performing Loan (NPL) dan Biaya Operasional Pendapatan Operasional (BOPO) terhadap Return On Asset (ROA) pada Bank BUMN Periode 2014-2020

This study aims to study how non-performing loans (NPL) and operational costs affect the return on assets (ROA) of state-owned banks. Corporate banking from all companies was sampled from four state-owned institutions: Bank Mandiri Tbk, Bank Rakyat Indonesia Tbk, Bank Negara Indonesia Tbk, and Bank Tabungan Negara Tbk. The method used in this research is a quantitative method. The data used to create this visualization is taken from the annual report submitted by the Indonesian Stock Exchange's Financial and Trade Regulatory Agency. The data in this study were analyzed using SPSS, which carried out various tests and statistical analysis, including descriptive analysis, the classical assumption test, multiple regression analysis, and the t test. The results of this study show that non-performing loans (NPLs) have a negative impact on BUMN banking ROA with large margins from 2014 to 2020. This indicates that when non-performing loans (NPL) increase, the return on assets (ROA) decreases, and vice versa. The impact of state-owned banking operational costs on return on assets (ROA) between 2014 and 2020 is negative and substantial. Simply put, the higher the BOPO, the greater the ROA.

The Role of Corporate Social Responsibility on the Performance of Indonesian Banking Corporation

Abstract: Purpose: The study employs Corporate Social Responsibility (CSR) as a moderating variable. We aim to discover the role of CSR on the influence of audit firm rotation (AFR), audit committee gender (ACG), and audit quality (AQ) on banking performance. Methodology/approach: The regression analyses were performed multiple and moderated to exploit the linear model and moderating model, respectively. Results/findings: The results show that ACG has a significant effect on banking performance, meanwhile AFR and AQ have no significant influence on banking performance. Furthermore, the results of the moderated regression analysis revealed that CSR cannot moderate the influence of AFR, ACG, and AQ on banking performance. Limitations: We limited the variables only in terms of AFR, ACG, and AQ for the direct influence on firm performance. Therefore, we did not include determinant variables of firm performance in the model (e.g., firm size, firm age, firm growth, financial ratio). We suggest for further research include these determinant variables as a control variable. Contribution: The study delivers understanding and information on behalf of the influence of AFR, ACG, and AQ on firm performance, particularly for the banking sector in emerging countries. In addition, this research has implications for regulators to improve banking performance. Novelty: We use CSR as a moderating role. To the best of our knowledge, there is no prior study that employs CSR as a moderating role among AFR, ACG, and AQ association to banking performance. Meanwhile, previous studies prove the strong relationship between CSR to banking performance. Keywords: 1. Audit Quality 2. Audit Committee Gender 3. Audit Firm Rotation 4. Banking Performance 5. Corporate Social Responsibility

A New Credit and Loan Lending Strategy and Credit in Banking Systems: An Evolutionary Game Theory Approach

In this paper, authors offer one novel mathematical model of credit lending to customers based on evolutionary game theory, and the model presents an efficient and realistic approach. The purpose of the article is to examine the evolutionary game between banks and customers for granting facilities and credit. Authors assumed that customers are divided into two types. The first type of customers includes individuals or small and medium enterprises (SME), applying for microloans from the bank. The second type of customers includes corporate banking or large enterprises, applying for large loans from the bank. The relationship between the bank and the customers is a double-sided problem. Banks and customers may trust each other or want to behave opportunistically. The results show that the game has two equilibriums, and the optimal equilibrium, which is the best-case scenario, occurs when customers and bank players tending to keep “honest” and to “credit,” respectively. Authors used the evolutionary stable strategy to express the parameters that affect these interactions, and by adjusting some of these parameters, authors move the equilibrium towards the optimal solution of the game. Also, by adjusting these parameters, banks can gain more profitability.

The Impact of Islamic Banking Corporate Governance on Green Banking

The primary purpose of the research is to investigate the impact of Islamic banking corporate governance on green banking in Iraq. In other words, the current study seeks to find an answer to whether corporate governance in Islamic banking can affect green banking in Iraq. For this purpose, the research method is applied based on the objective and descriptive survey. The statistical population of this research is all the managers, employees, and customers of the public and private banks of Iraq, and a total of 70 questionnaires have been completed and analyzed. The sampling method is non-random, and the available population was selected as the sample size. In this research, PLS tests have been used to investigate the effect of independent variables on the dependent variable. The results indicate that corporate governance in Islamic banking has had a positive effect on green banking, meaning that the increase of corporate governance mechanisms in Iraqi Islamic banking increase the level of attention of Iraqi Islamic banks to green banking matters. The current research was conducted in Iraq’s developing or emerging financial markets, which are highly competitive and under insufficient supervision.

The Effect Of Sustainability Reporting Practices On The Quality Of CSR Disclosures In Banking In Indonesia

Corporate social responsibility (CSR) has helped produce corporate banking social responsibility activities. However, even so, some aspects of the disclosure still do not meet the quality of reporting. This study aims to analyze the influence of CSR reporting practices and the quality of disclosures on banking companies in Indonesia. This study used as many as 383 samples of banking companies listed on the Indonesia Stock Exchange (IDX) from 2013 to 2021. This study seeks to investigate the use of three CSR reporting practices: stand-alone reports, assurance, and reporting guidelines. The study results show that banking companies have carried out CSR reporting properly and following the Global Reporting Initiative (GRI) standards but have not fully used assurance services to assess the quality of report disclosures. Banking companies in preparing CSR reports do not present the quality of information properly, so the implementation of sustainability reporting practices has not met the criteria. Banking companies meet the obligation to disclose CSR reports to improve performance. GRI disclosures are more likely to be balanced and have comparative capabilities. The results of this study support the increasing use of CSR reporting practices as a useful tool to improve the quality of CSR reporting in Indonesia.

Cooperative Banking: A Way for Inclusive Growth Through Co-Operative Micro Financing

Abstract: A bank is a financial institution licensed to receive deposits and make loans. Banks may also provide financial services such as wealth management, currency exchange, and safe deposits. There are several different kinds of banks including retail banks, commercial or corporate banks, and investment banks. In most countries, banks are regulated by the national government or central bank. Banking is defined as the business activity of accepting and safeguarding money owned by other individuals and entities, and then lending out this money in order to conduct economic activities such as making profit or simply covering operating expenses. Cooperative Microfinancing a new option for Government & Development Organizations. Micro financing is the provision of financial services to poor and low-income households without access to formal financial institutions. Microfinance is described as banking for the poor. Microfinance programs provide Micro credit/loans, Micro savings, Micro insurance, training to group members and other financial services to low income and poor people for use in small businesses. In Cooperative Micro Financing we are essentially looking at a "double bottom line"— social gains and commercial success. Conventional Micro financing setup is somewhat also lying on the same concept however Cooperative financial system naturally focus on welfare aspect. This paper tries, to inclusive growth among poor people through Co-operative Micro financing. This paper is an attempt to introduce an innovative and productive banking system in Kerala through co-operative micro financing. The author is aiming for the evolution of banking system in India especially in Kerala having an inclusive growth and upfilment and empowerment of poor by introducing new ways in the existing co-operative banking structure through Kudumbashree

Interest Rate Competition among C Banks, S Banks, and Credit Unions

Compared to C corporation banks, S corporation banks and credit unions are considered tax-exempt institutions, with credit unions receiving the greatest tax benefit. Institutions can choose to pass this benefit onto customers in the form of higher deposit rates and lower loan rates. We test this hypothesis by analyzing a dataset of 11 distinct deposit and loan products over 15 years and compare interest rates offered by depository institutions partitioned into three size groups. Overall, our results indicate credit unions offer higher deposit and lower loan rates compared to commercial banks, particularly for timed deposits (CDs), money market accounts, auto loans, and fixed unsecured loans. In contrast, S banks and C banks offer similar interest rates on most deposit and loan products. These findings generally hold across all size groups and differences become more pronounced when comparing larger credit unions to commercial banks. Notably, credit unions in the large size group offer better interest rates to customers for all products analyzed.

Exploring Factors Influencing the Sales Crisis in Iraninan Banking Industry- A Case Study of the Private Commercial Banks

The purpose of this study is to address two questions: Which factors influence the probability of occurrence of the banking sales crisis in the national banking system regarding the private commercial banks? Amongst the influencing factors, which ones have the most influence on the occurrence of the banking sales crisis? To achieve the study purpose, we performed semi-structured interviews with 15 individuals working in the banking society (branch managers, marketing managers, R&D managers, PR managers, and corporate banking managers in private commercial banks). We explored the factors influencing the banking sales crisis in 3 major themes, 5 minor themes, and 67 concepts. Findings showed that the factors influencing the banking sales crisis are as follows: understanding the banking sales crisis, the external drivers, and the internal drivers. The banking sales crisis is most influenced by external drivers, amongst which the economic, political and then, the social factors are the most influencing ones. Following these factors, the internal drivers, such as the lack of professional training in marketing-related fields, the lack of sales experts, and the internal corruption among the banking staff have considerable impacts that exacerbate the sales crisis. Understanding the banking sales crisis is due to the lack of sales knowledge in the banking system.

BAI SAGA: PYRAMID SCHEME, PONZI SCHEME, PONZI-LIKE SCHEME OR POLITICAL VENDETTA AND CONSPIRACY?

This paper sheds light on the collapse of the British American Investment conglomerate in Mauritius also known as the BAI Group. According to the Government of Mauritius, the BAI Group was operating a vast Ponzi Scheme via its banking subsidiary known as the Bramer Banking Corporation Ltd (BBCL). Furthermore, according to the report of nTan Corporate Advisory Pte Ltd which is a consultant of the Bank of Mauritius, the BAI Group’s subsidiaries such as the British American Insurance (BAI Co. (Mtius) Ltd) and Bramer Property Fund (BPF) were operating ‘Ponzi-like Schemes’. A good number of financial analysts, economists, and accountants contrarily stated that the BAI Group was operating a Pyramid Scheme. Whereas many investors of the BAI Group had the firm belief that it was a victim of political vendetta and conspiracy. Which is which? Dyed-in-the-wool prophets of doom such as the former Prime Minister of Mauritius, the current Prime Minister of Mauritius, the former Minister of Finance, Economic Planning and Development, and Foreign Affairs, Regional Integration and International Trade, the former Minister of Financial Services, Good Governance and Institutional Reforms, the leader of the MMM party and the former Governor of the Bank of Mauritius have all without exception subjectively and descriptively painted a black picture of the BAI Group hither and thither. On top of that, they have acted in ‘bad faith’ by misleading the Mauritian nation. This paper analyses the other end of the spectrum from a critical perspective based exclusively upon the Academic Literature and takes up the gauntlet with intrepidity to “Give The Devil His Due”.

Sustainable Development and Corporate Banking Responsibility

Sustainable Development and Corporate Banking Responsibility

Prioritizing operational strategies of saman bank

The extant study aimed to prioritize the identified operational strategies of Saman Bank based on a scientific method considering the effective factors identified inside and outside this Bank. Operational strategies are common banking strategies worldwide that first-class banks implement. The scientific segmentation steps, techniques, and criteria in Saman Bank were described and the identified strategies were tested using a scientific assumptions-based method. The obtained results were analyzed in the next step. The statistical population of the study comprised managers of Tehran branches and staff managers of Saman bank. The data were collected through a questionnaire. Eighty-four questionnaires were gathered from staff and line managers. Regression, Friedman test, and ANOVA were used to test hypotheses considering the questionnaire data. According to findings obtained from hypothesis testing, corporate banking was introduced as the best operational strategy in Saman Bank considering the competitive advantages of this bank and factors affecting the internal and external environment of the bank. Moreover, private banking, investment banking, retail banking, and international banking were at the next ranks of strategies.

Banking Digitalization: (Re)Thinking Strategies and Trends Using Problem Structuring Methods

Digital transformation is becoming more common in an increasingly digital world, which has contributed to significant changes in business processes around the globe. In the banking industry, this approach allows banking institutions to provide improved customer experiences. However, the determinants of successful banking digitalization are still unclear, as are their cause-and-effect relationships. This article sought to apply problem structuring methods, namely, fuzzy cognitive mapping and system dynamics, to develop a conceptual model that can be applied to analyses of banking industry digitalization. The results are based on two group sessions that were held with a panel of decision makers who deal with banking digitalization processes on a daily basis. The findings were validated by a senior staff member responsible for banking project assessment and development at Caixa Geral de Depósitos S.A.—a Portuguese state-owned banking corporation. The approach adopted in this article is unique because digitalization determinants were collected and analyzed based on the participants’ know-how and experience. Static and dynamic analyses produced a deeper, broader understanding of the dynamic cause-and-effect relationships between the identified determinants of banking digitalization, giving rise to a realistic model that can be used to support relevant decision-making processes.

Pengaruh profitabilitas, capital intensity, dan leverage terhadap agresifitas pajak pada perusahaan perbankan yang terdaftar di BEI tahun 2016-2020

This study aims to test whether profitability, capital intensity and liquidity have an effect on tax aggressiveness. This research is included in quantitative research, using secondary data in the form of annual reports or company financial statements. The objects in this study are banking companies listed on the Indonesia Stock Exchange for the 2016-2020 period, with the number of samples used as many as 26 companies. Sampling was carried out using a non-probability sampling purposive sampling method, with the criteria of 1) banking companies that were consistently listed on the IDX for the 2016-2020 period, 2) banking companies that presented financial statements in rupiah currency for the 2016-2020 period, 3) companies banking company banking that has a financial year ending on December 31 for the 2016-2020 period, 4) banking companies that are not at the break-even point or experiencing losses during the 2016-2020 period, 5) corporate banking that does not have an ETR value <0 or > 1. This study uses panel data regression analysis technique using Eviews 12. The results of this study indicate that the profitability variable has a significant negative effect on tax aggressiveness, the capital intensity variable has no significant effect on tax aggressiveness, and the leverage variable is not significant. effect on tax aggressiveness.

Compensation Management and Employee Commitment in Selected Banks in Lagos State

In the global world of today, for any organization such as banks to have competitive edge amidst her competitors, there must be in place a formidable compensation strategy to retain, attract, and motivate people to join the organisation. The ability of bank managers to achieve the bank corporate objectives to a large extent depends on the effective implementation of compensational packages in order to retain and motivate employees within and beyond their expectation. This study is on compensation management and employee commitment in selected deposit money banks in Lagos State, Nigeria. The problem of this research is that many Nigerian banks has failed to ensure the commitment of staff because they do not manage compensations adequately and as at when due. The objective of this study is basically to determine the effect of compensation management on employee commitment in selected deposit money banks in Lagos State. The research adopted survey research design. The population of study was 1100 and a sample of 600 was derived using Taro Yamane ‘s formula and this constitutes employees of selected three banks in Lagos State. Regression analysis test statistic at P-value of 0.05 level of significance was used in testing the hypothesis. The findings shohttps://www.eajournals.org/wp-content/uploads/Compensation-Management.pdfw that compensation management positively influences employee’s commitment in the selected deposit money banks in Lagos State. The study recommended that the management of selected deposit money banks should work on improving employees’ salaries, commissions and other direct compensations.

Streamlining Service Delivery of Final Duties and Taxes in a Private Banking Corporation

This paper discusses the actions taken regarding the slow delivery of final duties and taxes in a private banking corporation. The objectives were to eliminate customer complaints and close all the pending transactions to gain customer satisfaction and increase the percentage of clients and transactions served. After observations, a series of interviews, data collection and documentation, and collaboration efforts with the team members involved, the issue was constructed. Various tools were used in planning, constructing, implementing, and evaluating the streamlined process improvement. Process mapping and lean thinking methodology were applied to know which activity should be eliminated. A workflow instruction was formulated, which improved the cycle time. Time and motion analyses were crafted during the implementation to verify each transaction. Pending transactions, follow-ups, and complaints were compared before and after implementation to confirm if the streamlined process improved the service delivery. It was observed that some of the team members were hesitant to change at first, but by using convincing words and data during the team meeting, all members were convinced that streamlining service delivery is a need. After a month of implementation, the record showed that the streamlined process eliminated complaints, reduced follow-up concerns through telephone calls from clients, and decreased pending transactions by 50%. Through this, relevance of data to support a particular idea is further realized. Furthermore, it was also observed that the streamlined process improvement saved the company time, energy, and even costs. It ensures the fast delivery of products or services, resulting in customer satisfaction.

Stochastic Modeling for the Analysis and Forecasting of Stock Market Trend using Hidden Markov Model

The HMM is generally applied to forecast the hidden system of observation data. In this paper, we deal with the development of HMM for a proper understanding of finance variables in the stock market. Formulation of relationships between and within both the changing share values of Housing Development Finance Corporation Bank Limited (HDFC Bank Ltd) as visible/observed states influenced by the indicators of S&P Bombay Stock Exchange Sensitive Index (Sensex) as invisible/influencing states. Stochastic modeling with hidden Markov models is carried out for exploring various parameters of the model. Mathematical derivations for all the required statistical measures are obtained using the method of moments for the proposed probability distribution. Deducing mathematical formulation of initial probability vector, transition and observed probability matrices were carried out with the empirical data sets. Probability distribution for visible states of various lengths is obtained. It is observed from the empirically analysis that there is the maximum likelihood of rising the share prices of HDFC bank in consecutive two days. Furthermore, an attempt is made to estimate the long-run steady-state behavior of both the SENSEX and HDFC Bank share prices. The share value of HDFC bank will be on rising state from the 19th day onwards and it may be recommended for good investment choice for the long run. The findings of these studies will be valid for effective decision-making in portfolio management.