Banking Industry Research Articles (Page 1)

This study aims to investigate the influence of market concentration, bank capital, and efficiency on bank stability in Indonesia. The research was conducted using 93 banks' data collected from individual bank financial reports on Financial Services Authority (OJK) database report during the 2018-2022 period. Furthermore, panel data regression was used to estimate the parameters. The results suggest that there is a positive relationship between market concentration and bank capital on bank stability, although only bank capital has a significant effect. Whereas concentration implies a negative and strong effect on bank stability in Indonesia. The study indicates that various effects of the chosen variables shed light on the managerial practice, particularly related to risk assessment in the Indonesian banking industry.

ABSTRACT Federated learning can offer improved data privacy compared to centralized approaches, but it may be vulnerable to risks from unreliable or malicious nodes. Blockchain offers a decentralized and secure network that can improve model security. Combining federated learning and blockchain can enhance credit risk assessment, crucial for economic growth and default risk reduction. This research combines federated learning and blockchain to protect data privacy, ensures the confidentiality of sensitive financial information, and provides immutable storage. The credit risk assessment is experimented using Lending Club and Credit Card Limit Evaluation Datasets. The performance analysis conducted in this research revealed that decentralized federated learning achieved an accuracy of 80% and 90% for Lending Club and Credit Card Limit Evaluation datasets, respectively, while centralized machine learning yielded an accuracy of 80% and 88%, respectively. The results indicate that federated learning provides similar or even better accuracy while preserving data privacy. The integration of federated learning and blockchain technology offers a promising solution for credit risk assessment in the banking industry. By retaining data privacy and ensuring model security, this approach can reduce the risk of defaulting and promote economic growth.

This study investigates the impact of Natural Language Processing (NLP) on enhancing customer experience within the Zimbabwean banking industry. Employing a mixed-methods approach with a survey of 385 customers and interviews with bank officials, the research assesses the adoption, effectiveness and challenges of NLP technologies like chatbots and virtual assistants. Quantitative results indicate that NLP users reported significantly higher customer satisfaction scores and a 30% improvement in response times, compared to non-users, demonstrating NLP's efficacy in streamlining service delivery. However, first-contact resolution rates remained similar between groups, suggesting complex issues still require human intervention. Qualitative findings reveal significant implementation barriers, including high costs, a shortage of skilled personnel and integration challenges with legacy systems. Despite these hurdles, the study concludes that NLP holds substantial potential for improving operational efficiency and customer engagement in Zimbabwe. It recommends strategic investments in localized NLP solutions, capacity building and supportive policy frameworks to overcome existing challenges and fully leverage NLP for financial inclusion and competitive advantage in an evolving digital landscape.

This study explores the role of Artificial Intelligence (AI) in enhancing customer experience in Zimbabwean e-commerce platforms, with a focus on the banking industry. The research objectives are to examine the current state of AI adoption, assess the effectiveness of AI-driven customer experience solutions and identify challenges and opportunities for improvement. Grounded in the Service-Dominant Logic (SDL) Theory and the Technology Acceptance Model (TAM), this quantitative study employs a descriptive research design. A stratified random sampling technique was used to select a sample of 250 customers of Zimbabwean banks' e-commerce platforms. A survey questionnaire was used to collect quantitative data, which was analysed using statistical methods. The findings suggest that AI adoption has a positive impact on organisational performance and customer satisfaction and that AI-driven customer experience solutions are effective in improving customer satisfaction and loyalty. However, the adoption of AI-driven customer experience solutions is hindered by significant challenges, including data quality and regulatory issues. The study recommends that banks in Zimbabwe prioritise data quality, invest in AI-powered services and provide training and support to employees to ensure the successful adoption of AI-driven customer experience solutions. This study contributes to the understanding of AI adoption in the Zimbabwean banking industry and provides insights for banks to enhance customer experience and improve operational efficiency.

Purpose: This study aims to examine the impact of digital technology and corporate social responsibility (CSR) disclosure quantity and quality on firm value, as well as to test the role of financial flexibility and firm size as moderating variables in the context of the Indonesian banking industry. Methodology/approach: This study uses a sample of 276 banking companies listed on the Indonesia Stock Exchange during the 2019–2024 period, selected using purposive sampling. Data analysis was conducted using Moderated Regression Analysis (MRA). Findings: The research findings indicate that the disclosure of digital technology and both quantity and quality of CSR disclosure can enhance firm value, but this effect weakens when interacted with financial flexibility. Larger firm size strengthens the influence of both the quantity and quality of CSR disclosures, but not digital technology disclosure. These findings confirm that non-financial information, including both the quantity and quality of CSR disclosures and digital technology, has an impact on firm value. Practical implications: This study provides practical implications for banking management to prioritize verifiable CSR disclosures and the utilization of digital technology, as well as to ensure adequate financial support. Originality/value: This study contributes by integrating digital technology disclosure, quantity and quality of CSR, and firm size to support signaling theory.

This study aims to examine the impact of talent management practices on employee performance in the Islamic banking industry in East Java, Indonesia. Using a quantitative approach, data were collected through questionnaires distributed to 210 employees of Islamic banks. This study employed multiple regression analysis to test the relationship between talent management practices and employee performance. The results revealed that talent management practices, including recruitment, training, career development, and retention, have a significant positive impact on employee performance. These findings provide insight that effective talent management can improve productivity, work quality, and employee commitment to the organization. Therefore, Islamic banks are recommended to continue investing in talent management as a strategic tool to enhance employee performance, while ensuring these practices align with Sharia values to create an ethical and sustainable work environment.

Artificial Intelligence (AI) has become a significant driver of innovation in the banking sector, especially in the context of post-pandemic digital transformation. AI is widely utilized in areas such as fraud detection, credit evaluation, risk management, and customer interaction, attracting considerable interest from both academics and industry professionals. This research explores the recent advancements in AI within the banking industry, focusing on studies published between 2020 and 2025. A bibliometric approach is employed, using data from the Scopus database and bibliometric tools like VOSviewer and R Studio to visualize keyword networks and track emerging trends. The study aims to identify influential authors, journals, and countries contributing to AI research in banking. By analyzing these developments, the research highlights the contributions of AI to improving operational efficiency, data security, and financial inclusion, particularly in the Indonesian context. This work offers valuable insights into the ongoing integration of AI in the banking sector and its potential to shape future financial services, emphasizing its relevance to both global and regional markets.

Malaysia is leading the global Islamic banking and finance industry with a proper and well-designed legal and regulatory framework for Islamic financial institutions in the area of Ibra’ (rebate). In addition, Islamic co-operatives are among the providers of some form of Islamic financial service similar to Islamic financial institutions. An Islamic co-operative conducts activities and business based on Shariah principles. Being a non-banking financial institution, the legal and regulatory framework of Ibra’ for Islamic financial institutions does not apply to Islamic co-operatives. Islamic co-operatives instead have their own legal and regulatory framework of Ibra’ to address the issue. This article embarks on the qualitative and doctrinal approaches involving library-based research because it reflects the sources that the article analyses and the comparative approach as it compares the legal and regulatory framework of Ibra’ that is applicable to Islamic financial institutions and Islamic co-operatives. The current legal framework of Ibra’ indicates that it is applicable in cases of early settlement. It is noteworthy that nearly all of the SKM Guidelines’ content reflects that of the BNM Guidelines, but with specific changes to accommodate the co-operative sector’s comparatively lenient and adaptable characteristics. Despite efforts to rectify the shortcomings in the SKM Guidelines, they remain imperfect. By emphasising the shortcomings of the SKM Guidelines, regulators can proactively address the issues, and recommendations are proposed to address the limitations.

Retraction Note: Exploring the Impact of Geographic Factors on Urban Financial Innovation in China: Insights from the Banking, Insurance, and Securities Industries

This research paper presents a comprehensive evaluation of the Bahraini financial system, grounded in the Central Bank of Bahrain’s Financial Stability Report (FSR), March 2025. The paper systematically examines key developments across various financial sub-sectors, including the banking industry, capital markets, insurance services, monetary indicators, and the growing digital payments and FinTech ecosystem. The analysis focuses on the year ending December 2024. The findings underscore the resilience and adaptability of Bahrain's financial institutions amidst a globally volatile economic environment characterized by geopolitical uncertainties and tightening monetary conditions. The study highlights how strong capital adequacy, diversified financial services, effective supervision, and a commitment to financial innovation have collectively contributed to preserving financial stability. By offering a macro prudential perspective on Bahrain's economy, this research aims to support regional discourse on sustainable financial development and guide policy formulation.

This study explored cloud computing security threats and evaluated cloud security offered solutions in Pakistan. The study was based on a mixed-method study design. The quantitative component was extracted from 200 IT security experts employed in the banking, healthcare, education, and telecommunications industries, while the qualitative component was based on 25 cloud security professionals located in Karachi, Lahore, and Islamabad. Secondary data was information from the literature and cloud security related case studies in Pakistan from the years 2020 through 2024. The study investigated multiple models of cloud services and the common threats such as data breaches, account hijacking, distributed denial of service (DDoS) attacks, and issues of compliance in relation to the regulatory environment in Pakistan. The quantitative data which was analyzed through the use of the SPSS software, showed various threats and security measures to be implemented. The qualitative data provided contextual invaluable insights on security measures that could be employed given the available infrastructures. The results suggest that cloud security within Pakistan was the result of weak security policies, low cloud security awareness, and limited organizational resources. The study suggested the use of internationally accepted security standards, layered security systems, routine security checks, and user training as the best practices. This work highlights the security practices that Pakistan organizations need to consider while adopting cloud computing in order to counter the potential cyber threats.

Total climate change risk and banks' loan portfolios: Fresh evidence and extensions.

Advancing credit risk assessment in the retail banking industry: A hybrid approach using time series and supervised learning models

This research examines the relationship between corporate social responsibility (CSR) and perceived financial performance (FP) in the Saudi Arabian banking industry using the mediating variables of employee engagement (EE) and green creativity (GC). This study is based on the Social Identity Theory and considers CSR as an engine to produce ethical and social results and promote environmental innovation and sustainable competitiveness. According to a survey of 650 banking employees and structural equation modeling (SEM), the results show that CSR significantly and positively affects EE, GC, and FP, with EE having the strongest mediating role. These conclusions highlight the strategic consequence of CSR in advancing sustainability by balancing financial performance, employee welfare, and environmental innovation. This study adds value to the existing body of research because it provides information on the CSR-FP relationship in a developing economy, where such information is scarcely available. Consistent with the definition of sustainability, this study indicates how CSR activities combine social, environmental, and economic aspects to foster long-term organizational sustainability and sustainable development.

Against the backdrop of the current hierarchical development of Chinas financial system and the intertwined demands of the real economy, this study compares and analyzes the business strategies of Quanzhou Bank (a regional bank) and China Construction Bank (a state-owned bank). In the research process, the strategic positioning of the two was first analyzed from the perspectives of development positioning, core resources, and policy dependence. Secondly, the differences in business strategies between the two were compared in terms of market positioning and customer base, product and service innovation, risk management and compliance, and digital transformation. Once again, the driving factors behind the strategic differences between Quanzhou Bank and China Construction Bank were analyzed, including policy orientation differences, resource capacity constraints, market competition pressure, and different customer groups. Finally, research recommendations were proposed from three levels: regional banks, state-owned banks, and regulatory authorities. In order to reveal the collaborative mechanism and conflict nodes of Chinas multi-level financial system, and provide theoretical basis and practical reference for optimizing the division of labor ecology in the banking industry and enhancing the efficiency of financial services for the real economy.

This study aims to examine how Islamic financing contributes to the empowerment of micro, small, and medium enterprises (MSMEs), particularly in the trade sector. MSMEs play a crucial role as one of the main pillars of the national economy; however, they continue to face various challenges such as limited access to capital, inadequate managerial skills, and low levels of financial literacy. Islamic financing emerges as a solution by applying fundamental Islamic principles, including the prohibition of usury (riba), fairness, and transparency in all financial transactions.The research employs a descriptive qualitative method based on a literature review from various reliable sources. The findings reveal that Islamic financing, through contracts such as murabahah, musyarakah, mudharabah, and ijarah, not only provides access to capital but also offers mentoring and training programs to help entrepreneurs manage their businesses more professionally.The positive impact of Islamic financing can be seen in the improvement of business performance, increased turnover, and enhanced welfare among MSME actors. Furthermore, this system contributes to the stability of the Islamic banking industry and promotes sustainable national economic growth. Therefore, further development of Islamic financing is necessary to expand its reach and benefit a greater number of small and medium enterprises across Indonesia.

Opprobrium directed at banks and bankers during economic crises stems from ethical conflicts caused by the primary product of the banking industry: the fractional-reserve demand deposit. There exist two schools of thought on the legality and the ethical nature of this contract. The “essentialist” school views this contract as inherently contradictory due to the conflicting attributes fundamental to its construct. The “nominalist” school views this contract as sui generis —a financial innovation that has passed the market test—holding that while past financial and legal institutions may have been at odds with such a contract, the modern economy is different. In this article we show that the essentialist view on banking contracts is not only defensible but necessary, given the unique attributes of money and perfect money substitutes. This viewpoint allows the resolution of the legal and economic difficulties while improving the ethical standing of banks: it clarifies ownership rights in deposits, and mitigates the risk of bank runs by requiring full reserves.

Purpose A major challenge in aligning leadership styles with organizational performance is the difficulty of matching the appropriate leadership style to the varying needs of employees and the goals of the organization, which complicates achieving consistent results. Therefore, this present study aims to examine the effect of both transformational and transactional leadership styles on organizational performance. The moderating role of human capital development. Design/methodology/approach The research design used was a descriptive survey. Because of the respondents and the nature of the study, a purposive sampling technique was used and the study’s population consisted of 16,000 employees of the First Bank PLC. Krejcie and Morgan’s sample size formula was used to determine the sample size of 375. Information was obtained from the participants using a questionnaire. Lastly, the study utilized partial least squares regression to examine the developed hypotheses and a frequency table to examine the participant profile. Findings The results showed that both the transformational and transactional leadership styles have a positive and significant effect on organizational performance. Additionally, the results revealed that human capital development moderates the relationship between transformational and transactional leadership styles and organizational performance. Originality/value The moderating role of human capital development on the relationship between both transformational and transactional leadership styles and organizational performance within the Nigerian banking industry.

This paper examines how legal frameworks and institutional structures influence accounting practices and financial transparency within the Iraqi banking industry from 2010 to 2024. Based on a balanced panel dataset of 47 banks derived using official data, which comprise the Central Bank of Iraq, and published annual bank data, the study determines some main determinants of transparency. The use of International Financial Reporting Standards (IFRS), strict exercise of anti-corruption, efficacy of audit, and judicial regimes of administration have been identified to drastically improve financial disclosure. The impact of the clarity of the tax law is less extensive, although statistically significant. However, contrary to this, the size of a company does not have a great influence on transparency; thus, the quality of governance is more influential than the size of the organization. In an endeavor to deal with the possible endogeneity of the research and variation over time in the panel data, the research uses the Generalized Method of Moments (GMM) estimation procedure. The approach is more suitable with the lagged financial panel data, as it is used in providing unbiased and efficient estimates. Diagnostic tests indicate robustness in the model, such as the Hansen J-statistic and no second-order autocorrelation. The results have viable suggestions for policymakers and banking regulators in Iraq. The response to this is increasing the enforcement of the law, enforcing compliance with international standards, and enhancing institutional oversight, and as a result, all this has been able to strengthen the credibility and reliability of the financial report. These experiences and lessons are especially useful to new and post-conflict economies interested in modernization of their financial systems and in foreign investment.

ABSTRACT Measuring and improving the efficiency of commercial banks is crucial for promoting the high‐quality development of the banking industry. Bank operations can be divided into a sequential, two‐stage process consisting of a deposit collection stage and a profit earning stage, with deposits as an intermediate measure. Deposits are a limited resource for which banks compete, exhibiting a fixed‐sum characteristic, which must be considered when measuring bank efficiency. To this end, based on the noncooperative game mechanism, we propose a novel two‐stage general equilibrium efficient frontier data envelopment analysis (GEEFDEA) approach considering fixed‐sum intermediate measures. We then apply the model to measure the deposit collection efficiency, profit earning efficiency, and overall efficiency of 56 listed Chinese commercial banks from 2017 to 2023. Further, we employ a fuzzy set qualitative comparative analysis (fsQCA) approach to explore the paths leading to high bank efficiency from a configurational perspective. This study finds that when deposit collection takes priority, 44 banks had an overall efficiency below 1 during the study period, with a deposit collection efficiency of 1.1216 and a profit earning efficiency of 0.7901. When the profit earning stage takes priority, 42 banks achieved an efficiency above 1. The deposit collection efficiency (0.3671) is much worse than the profit earning efficiency (2.8612). Additionally, the configuration analysis shows that high bank efficiency results from the synergistic effects of condition variables. Finally, theoretical and practical implications are discussed.