Iranian Banking Industry Research Articles

Enhancing the participation intention and improving customer satisfaction in the banking industry by utilizing social media technology due to the mediating role of value perceived by customers

This research was designed to examine the effect of using social media technology on improving participation and customer satisfaction in the banking industry due to the mediating role of value perceived by customers of the studied banks. The present study was an applied and descriptive-surveying research in terms of objective and methodology, respectively. The research statistical sample consisted of 235 senior managers of state and private banks in the banking industry of Iran. A questionnaire was employed to collect the research data, and its validity and reliability were con and Cronbach's alpha indices. The structural equation modelling method was used in the SmartPLS software to test the research hypotheses once the data was gathered. The results of testing the hypotheses demonstrated that the use of social media technology has a positive impact on improving participation intention, satisfaction, and value perceived by customers of the studied banks, which directly predicts 0.486, 0.551, and 0.568 of changes related to the participation intention, satisfaction, and perceived value, respectively. The results analysis also revealed that social media technology has a positive impact on participation intention and customer satisfaction through the value perceived by customers. Hence, the use of social media technology through the mediating variable indirectly predicts 0.517 and 0.449 of changes related to participation intention and customer satisfaction, respectively. Accordingly, one may acknowledge that the studied banks can move towards sustainable improvement of customer participation and satisfaction by accurately utilizing social media technology such as social networks aimed at boosting the continuous relationship with their customers as well as improving the capabilities of customer relationship management by related technologies.

The Phenomenon of Credit in the Perspective of Religious Culture

Relevance. The article notes that usury can pose a threat not only to public morality, but also to state security. Meanwhile, in Russia, interest-bearing lending has become a significant part of banking activity, and loans are often imposed on citizens. This article is devoted to the norms of bank lending, which are studied in the context of religious cultures. Purpose. Due to the fact that the phenomena of social and economic life are especially useful in accordance with the norms of culture, it is proposed to explore such ways of development of the banking sector of the economy, in which they would be consistent with the principles of traditional culture, which are expressed in world religions, primarily Christianity and Islam. The objectives of the article correlate with its purpose and suggest identifying ways to eliminate usury and replace it with more effective means of developing banking business. Methodology. The methodological basis of this article is the dialectical unity of induction and deduction, analysis and synthesis. The comparative method is also used. Results. It is emphasized that usury is considered a serious sin in both Christianity and Islam. Using the example of the banking system in Iran, the article suggests mechanisms for bringing the principles of lending to business projects in accordance with ethical and religious canons. In a sense, these canons correspond to the principles of the socialist economy and are consistent with the norms of the welfare state. Conclusions. The main idea of the article is that banks abandon usurious activities and invest capital in projects, from the net profit of which they also have a certain income. In this case, the bank itself is interested in the success of the business in which it invests funds. Accordingly, with this approach, the level of risks is significantly reduced and doing business acquires real partnership foundations.

Inverse data envelopment analysis optimization approaches with flexible measures

PurposeThe purpose of this study is to estimate inputs (outputs) and flexible measures when outputs (inputs) are changed provided that the relative efficiency values remain without change.Design/methodology/approachA novel inverse data envelopment analysis (DEA) approach with flexible measures is proposed in this research to assess inputs (outputs) and flexible measures when outputs (inputs) are perturbed on condition that the relative efficiency scores remain unchanged. Furthermore, flexible inverse DEA approaches proposed in this study are used for a numerical example from the literature and an application of Iranian banking industry to clarify and validate them.FindingsThe findings show that including flexible measures into the investigation effects on the changes of performance measures estimated and leads to more reasonable achievements.Originality/valueThe traditional inverse DEA models usually investigate the changes of some determinate input-output factors for the changes of other given input-output indicators assuming that the efficiency values are preserved. However, there are situations that the changes of performance measures should be tackled while some measures, called flexible measures, can play either input or output roles. Accordingly, inverse DEA optimization models with flexible measures are rendered in this paper to address these issues.

Designing a model for organizational socialization of employees in Iran's healthcare system

Background. Organizational socialization is a process of teaching employees to successfully integrate into a new organization. Socialization needs to be presented in the form of a coherent pattern. Methods. This study aimed to design a model for the organizational socialization of employees in Iran’s healthcare system using the grounded theory method. Semi-structured interviews were used to extract the main factors influencing the socialization of employees. In-depth interviews were conducted with 19 experts, including specialists, managers, and employees of the healthcare system using the purposeful sampling method. We extracted 49 concepts and 19 categories using the foundation data method in the open coding stage. Results. The findings showed that developing a model for organizational socialization in Iran's banking system requires the senior managers’ constant support, social responsibility, and socializing organizational culture. The values, norms, and roles expected from the individual should be transmitted clearly. Conclusion. An organizational socialization model can enhance the socialization of employees in Iran’s healthcare system. Practical Implications. The development of socialized human resources, socialized competitiveness, and socialized basic management requires the Bdesign of socialized human resources processes, an evaluation system, a resource allocation system, socializing succession, and value creation.

Applying the Balanced Scorecard and the Delphi Method to Determine the Key Performance Factors for the Banking Industry in Iran

The lack of having an anchored, strategy management performance infrastructure prevents leaders from evaluating the performance strengths of the organization’s strategic priorities. Evaluating the strategic performance of an organization is critical to the success and sustainability of a high-performing organization. The key is to evaluate the strategic performance of an organization using a strategy management performance system that consistently provides leaders with valid information to make informed strategic decisions. The Balanced Scorecard (BSC) is one of the leading strategy management performance systems that provides the infrastructure for evaluating the strategic performance of an organization. The BSC is a multidimensional strategy management performance system that links tangible financial assets with intangible nonfinancial assets in a cause-and-effect logic to evaluate the success of a strategy. The aim of this study was to identify the objectives and key performance factors (KPFs) for the banking industry in Iran. The population for this study consisted of 20 experts from multiple banks in Iran. A purposive judgmental ample was used to arrive at the sample of 20 participants. A questionnaire was used to collect the data in the study. The Delphi method was employed as the analysis mechanism to arrive at a consensus. The study concluded that the success of the banks in Iran depends on four financial perspective objectives and four KPFs; three stakeholder perspective objectives and five KPFs; three internal process perspective objectives and six KPFs; and three learning and growth perspective objectives and three KPFs. The identified objectives and KPFs are characterized as the strategic performance priorities for success in the Iranian banking industry.

Using the Balanced Scorecard and the Analytic Hierarchy Process to Rank the Key Performance Factors in the Iranian Banking Industry

Ranking the appropriate Key Performance Factors (KPFs) for banks in Iran is vital for determining the focus of the bank’s economic growth and development. Although identifying the appropriate KPFs is important for the outgrowth of the Iranian banks, one of the most critical performance drivers is establishing the appropriate strategy management framework and infrastructure to drive strategic performance in Iranian banks. The Balanced Scorecard (BSC) methodology is a multidimensional strategy management performance system that provides leaders with tools to identify industry forces, to develop a strategic plan with causal linkages, to align an organization, to drive performance, and to evaluate organizational growth and development. The BSC was the conceptual framework used in this study along with the Analytic Hierarchy Process (AHP) method. The population of this study consists of 25 professionals of the Iranian Banking Network (IBN). A purposive judgmental sample was used to arrive at the sample size. The aim of this study was to identify, rank, and prioritize the appropriate KPFs to determine the best path forward to advance the bank’s economic goals and to strengthen the nation’s economy. The AHP method guided the decision of the banking professional in determining the KPFs for the Iranian banking industry. The KPFs were grouped together according to the BSC’s four perspectives: financial, customer, inner process, and learning & growth. The study provided implications for decision makers in the Iranian banking industry that the highest KPFs for the financial perspective is economic value-added, for the customer perspective is future years profit, for the internal process perspective is given facilities, and for the learning and growth perspective is the average work life of an employee.

Proposing a model for accepting core banking system in Iran using fuzzy DEMATEL technique: a case study

Proposing a model for accepting core banking system in Iran using fuzzy DEMATEL technique: a case study

Investigating the Role of Factors Related to Jihadist Management and Organizational Spirituality in Iran's Banking System (Case Study: Sepah Bank Employees in the Southeast Region)

Investigating the Role of Factors Related to Jihadist Management and Organizational Spirituality in Iran's Banking System (Case Study: Sepah Bank Employees in the Southeast Region)

Can the transition from Basel II to III change the monetary policy impact on the Iranian economy and banking system?

Using a dynamic stochastic general equilibrium (DSGE) model, we analyzed the impact of the Basel II and III capital requirements regulations on the effects of monetary policy shocks on the behavior of the macroeconomy and the Iranian banking system. According to the structural shocks, four observable variables including output gap, bank capital adequacy, inflation and money base growth rate during the period from 2004Q1 to 2020Q4 were included in the Bayesian estimation process along with some other predetermined parameters. Finally, the impulse-response functions of the model were interpreted in two scenarios Basel II or III to the capital adequacy ratio. The results suggest that if banks operate under the Basel II capital regulations, the central bank’s use of money supply may lead to low growth in the economy in the short-run, but in the medium- and long-run, the negative effects will be much larger. However, with the introduction of Basel III regulations for banking business, the output fluctuations will be reduced by the expansion of money supply. The results also show that a shock to the money supply leads to a sharp increase in inflation, and it is noteworthy that the introduction of Basel II or III does not affect the nature of the inflation response to monetary policy. Finally, we found that in both scenarios of the introduction of Basel II and III due to a monetary policy shock, bank profitability falls sharply in the short-run. However, with the adjustments that the bank makes to interest rates, it quickly returns to profitability.

Enhancing financial performance by applying knowledge management and new financial technologies in the banking industry

Considering the mediating role of the new financial technologies, this paper aims to study the relationship between the use of knowledge management (KM) and the enhancing financial performance of banks in the banking industry of Iran. In terms of purpose, the paper was applied and correlational one in terms of descriptive method. The statistical sample was made up of 180 senior and middle managers of active banks in Iran with at least 5 years of work experience (tenure) in KM and new financial technologies. Moreover, A questionnaire was applied to collect research data, and the validity and reliability were confirmed through CVR and Cronbach's alpha indices. Upon collecting the data to test the research hypotheses, the structural equation modeling method was applied in the SmartPLS. The results showed that KM holds a positive and significant effect on enhancing financial performance and 0.682 directly predicts the changes related to the financial performance of the studied banks. Furthermore, further analysis of the results showed that KM through modern financial technologies holds a positive and significant effect on the financial performance of active banks in the banking industry of Iran. Consequently, applying KM dimensions (use of knowledge, acquisition of knowledge, and integration of knowledge) along with modern financial technologies - such as cloud computing technology, smart contracts, and artificial intelligence – is likely to enhance the financial performance of banks and provide sustainable profitability.

COVID-19 management in Iran and international sanctions.

Iran has one of the highest death rates from COVID-19 among Middle Eastern countries. In addition to having a better disease registration system compared to neighboring countries, many factors including economic conditions, have played an important role in increasing the number of mortality rate. This is while that during the Corona pandemic, Iran has been undergo severe sanctions by the United States, that has faced this country with a severe economic crisis. Considering the role of sanction on the country's health management in our study, we examined Iran's management plans against the Corona pandemic and the effect of sanctions on it. Quarantine and corona restrictions, on the one hand, and international sanctions, on the other hand, have put double pressure on the Iranian government. Although drugs and basic medical equipment are exempted from economic sanctions, direct and indirect effects of the sanctions have limited Iran's banking system and created widespread restrictions in the fields of trade, production, and investment. Fortunately, despite the sanctions, many hospitals had an appropriate performance in line with the health promotion program. It is obvious that economic sanctions have severe and harmful effects on public health and have led to poor health consequences in Iran, but attention to planning, standards and improving the quality of the hospital is an important issue in Corona management. Despite multiple mutations, this virus is likely to face with a more dangerous virus in the world future. Now, it is time to take appropriate management measures to remove these sanctions by relying on international solutions and interactions.

Stress test of Liquidity risk in Iran's banking system: Calculating of loss distribution of banks' liquidity risk with Monte Carlo simulation method

Stress test of Liquidity risk in Iran's banking system: Calculating of loss distribution of banks' liquidity risk with Monte Carlo simulation method

Application of viable system model in diagnosing defects and problems of the credit supply chain network in the Iranian banking industry

AbstractThe present study attempts to study the credit supply process in the Iranian banking industry by using the viable system model (VSM) to identify its vulnerabilities and improve the financing system. The method used in this study consists of three steps: (a) identification of system, (b) diagnosis of system and (c) control of information flow, communication channels and frequent errors. In this research, 37 credit experts from 17 different bank branches were interviewed about the process of granting facilities, and SPSS 23 was used to examine research objectives through the Delphi method. The results show that the structure of Iran's credit supply chain network suffers from such problems as deviation in the appropriate use of allocated credit resources, structural faults of the banking system and lack of administrative health, high bureaucracy, directed facilities, etc. In the end, some suggestions are provided for redesign and optimization of the credit supply network.

The Resilience of the Iranian Banking System to Macro Shocks with an Emphasis on Credit Risk

The Resilience of the Iranian Banking System to Macro Shocks with an Emphasis on Credit Risk

The Impact of “CAMEL Composite Index” on Income Diversification: A Case Study of the Iranian Banking System

The Impact of “CAMEL Composite Index” on Income Diversification: A Case Study of the Iranian Banking System

Measure TOPSIS Model for Evaluation and Selection of Resilient Banks in the Iranian Banking Industry

Measure TOPSIS Model for Evaluation and Selection of Resilient Banks in the Iranian Banking Industry

Diagnosing of human resource performance management based on lack of ambidextrous learning themes: a case study of public Iranian banking system

PurposeWith drastic changes in the external environment, many organizations today cannot continue their activities and create sustainability in achieving long-term goals without having carefully designed and coordinated systems with each other. The human resource performance management system is considered as one of the most important process pillars of any organization that without any specific strategic mechanism, such as inclusive learning, faces challenges and harmful conflicts. The purpose of this study is to diagnose human resource performance management based on the lack of ambidextrous learning themes in the banking system.Design/methodology/approachIn this study, theoretical screening based on similar research was used to identify the components (diagnosing of human resource performance management) and research propositions (ambidextrous learning themes). Then, Delphi analysis was used to determine the reliability of research components and propositions by the participation of 13 management specialists and experts. In the quantitative part, the components and propositions identified in the form of matrix questionnaires were evaluated by interpretive analysis by 18 managers of banking system.FindingsThe results showed that the proposition of lack of strategic tendencies in learning is considered as the most effective theme of ambidextrous learning in reinforcing the damage of strategic incompatibility in the performance functions of human resource management (HRM).Originality/valueThis result shows that the lack of strategic orientations due to the ineffectiveness in identifying environmental capacities in the banking system in the field of HRM performance is a new challenge.

Organizations Assessment Based on EFQM Excellence Model Using Neutrosophic Logic (Case Study: Iranian Banking Industry)

ازآنجاکه ارزیابی مدل­‌های تعالی، به‌ویژه مدل تعالی EFQM، با رویکرد منطق رادار مبتنی بر قضاوت ذهنی ارزیابان است و در فضای عدم‌­قطعیت رخ می­‌دهد، هدف پژوهش حاضر ارزیابی دقیق‌­­تر سازمان­‌ها بر اساس مدل تعالی EFQM با استفاده از منطق نوتروسوفیک در صنعت بانکداری است تا مقادیر برآوردی ارزیابی را به روشی دقیق‌تر انجام دهد. در این پژوهش ارزیابی سازمان بر اساس مدل تعالی EFQM با استفاده از منطق نوتروسوفیک که یک منطق سه‌­ارزشی در فضای عدم‌­قطعیت است، صورت گرفت. ابتدا یک ابزار ارزیابی برای سنجش با منطق نوتروسوفیک طراحی شد. روایی سازه و محتوای پرسشنامه به‌­دلیل استفاده از چارچوب مدل تعالی EFQMدر طراحی آن و همچنین تأیید خبرگان حوزه ارزیابی، قابل­‌قبول بوده و پایایی آن با روش دستیابی به مشابهت نظر خبرگان و اتفاق­‌نظر آنان بر پایا­بودن پرسشنامه تأیید شد؛ سپس سازمان­‌های منتخب که شامل سه بانک دولتی، خصوصی و شبه‌دولتی بود با استفاده از این ابزار توسط گروه ارزیابان منتخب جایزه ملّی تعالی سازمانی ارزیابی شدند و درنهایت مقایسه‌­ای بین نتایج این ارزیابی با منطق رادار صورت گرفت. بنا بر نظر خبرگان ارزیابی جایزه ملّی تعالی EFQM و همچنین محاسبات انجام‌شده، ارزیابی سازمان­‌های مورد­مطالعه با رویکرد منطق نوتروسوفیک دقیق­‌تر از ارزیابی با رویکرد منطق رادار است.

Empirical evaluation of structure-conduct-performance paradigm as applied to the Iranian Islamic banking system

PurposeThis paper aims to investigate the impact of market structure and market share on the performance of the Islamic banks operating in the Iranian banking system based on the structure-conduct-performance (SCP) paradigm.Design/methodology/approachThe Iranian Islamic banking system’s market structure is evaluated by using the econometrics method to test the validity of the traditional SCP paradigm. For this purpose, the authors estimate a simple regression model that is consisted of several independent variables, such as the market share, bank size, real gross domestic product, liquidity and Herfindahl-Hirschman index as a proxy variable for concentration and one dependent variable, namely, the profit as a proxy for performance. The panel data includes a data sample of 22 Islamic banks operating from 2006 to 2019. Data are extracted from the balance sheet of Islamic banks and the time-series database of the Central Bank of Iran and World Bank.FindingsThe study’s findings indicate that both concentration and market share have a positive impact on the performance of banks in the Iranian Islamic banking system. This result is contradicted with both traditional SCP and efficient structure hypotheses; however, it confirms the existence of oligopoly or cartel in the Iranian Islamic banking system that few banks try to gain the highest share of profit and maintain their market share by colluding with each other. This result is in contradiction with other research studies about the market structure in the Iranian banking system that claimed that banks in Iran operate under monopolistic competition. In addition, it shows that the privatization of some banks in Iran does not improve and help competition in the Iranian banking system.Originality/valueThis paper is a pioneer empirical study analyzing the market structure, concentration and collusion based on the SCP paradigm in Iranian Islamic banking. The results of the study support the existence of collusive behavior among the Islamic bank in Iran that is not aligned with Sharia. This study clearly shows the difference between ideal Islamic banking and Islamic banking in practice in Islamic countries. This clearly indicates that only prohibiting some operations like receiving interest, gambling and bearing excessive risk is not enough. In fact, the Islamic banking system should be based on the Sharia rule in all aspects and much more modification and study have to be done to achieve an appropriate Islamic banking system. These possible modifications to overcome the issues of cartel-like market structure and collusive behavior in the Iranian Islamic banking system include making the Iranian banking system more transparent, letting foreign banks enter the Iranian banking system and minimizing the government intervention in the Iranian banking system.

Bank Competition and Risk-taking in the Iranian Banking Industry

Bank Competition and Risk-taking in the Iranian Banking Industry