Bank Behavior Research Articles

Assessing The Effect of Digital Banking Services on Retail Banking Customers’ Satisfaction Levels in Lusaka’s Central Business District

Digital banking platforms have improved the way banks deliver their services to clients which has resulted in the gradual movement from brick and mortar to the use of digital applications such as mobile phones, iPads, laptops and ATM machines. The purpose of this study was to assess the effect of digital banking on retail banking customer service satisfaction levels in Lusaka Town. The study was guided by three objectives which were; to determine customers’ perception of the reliability of digital banking services in Lusaka Central Business District; to assess customers’ perception of the responsiveness of digital banking services in Lusaka Central Business District and, to examine customers’ perceptions of the security of digital banking services in Lusaka Central Business District. This study investigated customers' perceptions of digital banking services, focusing on reliability, responsiveness, and security, using a quantitative approach. Simple random sampling was used to collect data using a structured questionnaire with 5-point Likert scale. The researcher ensured that the respondents remained anonymous to avoid bias and that whatever information they provided would be treated with confidentiality. The researcher did not influence the responses provided by the respondents in anyway. The sample size was 150 and 140 respondents who are bank customers in Lusaka Central Business District responded. The response rate was 93.33%. The data was analysed using descriptive statistics, ANOVA, hierarchical regression, and correlation analysis. The findings reveal that customers generally perceive digital banking services positively in terms of reliability and responsiveness, with significant associations found between these factors and overall customer satisfaction. However, concerns remain regarding security, despite moderate confidence in digital banking security measures. The study underscores the importance of trust, transparency, and technological advancement in shaping customer perceptions. Recommendations for further research include exploring the impact of AI technologies, regulatory frameworks, and demographic differences on digital banking adoption and satisfaction. These findings contribute to understanding customer behaviour in digital banking and inform strategies for enhancing service delivery and customer experience in the financial sector.

Corruption, Funding Structure and Bank Lending of Dual Banking System

The main objective of this paper is to examine the interaction effect of political turmoil on the relationship between funding structure and bank lending behaviour of Islamic (IBs) and Conventional banks (CBs). Political turmoil is measured by corruption (CPI) and election year (ELY) while the funding structure is measured by Total Customer Deposits (TCD) and Total Bank Deposits (TBD). We conducted a panel analysis of Islamic and conventional banks to ascertain whether the funding structure of Islamic banks can sustain financing supply and whether its growth is higher than conventional bank lending growth in times of political turmoil. Using the matched-pair technique, this study utilizes a panel sample of 58 Islamic banks and 58 conventional banks from 18 dual-banking countries from 2006 to 2017. The generalised Method of Moments (GMM) is used to deal with the endogeneity and heterogeneity issues. We observed that corruption and elections affect the amount of lending/financing given to IBs and CBs. The study found that TCD hinders the growth of credit supply for both IBs and CBs during elections. Nevertheless, TBD did not have any influence on bank lending. The study on interaction reveals that political turmoil has affected the relationship between funding structure and bank lending for Islamic and conventional banks. These findings contribute to supporting the Islamic banking system's involvement in financial and economic stability. This suggests that corruption is influencing the funding structure within the banking system, which in turn affects the availability of credit from banks. Future research could investigate whether the governance by the bank’s management leads to credit supply efficiency.

A Psychometric Evaluation of the Couples’ Financial Communication Scale: Findings and Implications from Two Large, Diverse Samples

AbstractCommunicating about finances is essential to develop shared meaning and goals within couple relationships. When couples struggle to discuss finances, they can experience poor couple outcomes. For researchers and clinicians to effectively study and promote healthy couple communication patterns regarding finances, a parsimonious, reliable, and valid measure of couples’ financial communication is needed. This study examined the psychometric utility of the 5-item Couples’ Financial Communication Scale (originally developed for the Flourishing Families Project; Day, R. D., Bean, R., Coyne, S., Dyer, J., Harper, J., & Walker, L. (2017). Flourishing families project: Survey of family life [codebook].) using two large, diverse samples—one of emerging adult individuals in a romantic relationship (N = 1,950) and another of dyads in a romantic relationship (N = 1,252; 69.9% beyond emerging adulthood). Similar findings emerged across both samples. Inter-item correlations, skewness, and kurtosis of the five items were within acceptable ranges. The five items loaded onto a latent construct with robust standardized factor loadings (ranging from 0.63 to 0.90) and sound model fit. Cronbach’s alpha revealed sound reliability (α = between 0.85 and 0.89). Multiple tests of measurement equivalence suggest the measure appears to be reasonably useful across theoretically meaningful groups (gender, age, income, marital status, and joint banking behaviors). Couples’ financial communication and couples’ relationship quality were positively correlated with large effect sizes—showing initial evidence of predictive validity. The parsimonious Couples’ Financial Communication Scale has sound evidence of reliability, validity, and measurement equivalence across two diverse samples, which positions it to be a useful measure in future scholarship to assess the degree to which couples engage in ongoing healthy and cooperative financial communication.

Foreign currency borrowing behaviour of Indian banks: What Matters the Most?

Foreign currency borrowing behaviour of Indian banks: What Matters the Most?

Bank Reputation and Trust: Impact on Client Satisfaction and Loyalty for Portuguese Clients

The aim of this article is to assess the most relevant factors influencing customer trust in the Portuguese banking sector following the Global Financial Crisis. It also aims to evaluate the impact of trust on satisfaction and satisfaction on loyalty. To address the research objectives and the hypotheses posed, a quantitative study with a descriptive design was conducted. Data was collected through an online survey administered to a sample of bank clients residing in Portugal. The findings indicate that respondents generally trust Portuguese banking institutions, although this trust has been affected by the Global Financial Crisis. The bank’s reputation and financial performance were identified as critical factors in the respondents’ choice of bank. Additionally, the results suggest that both global and domestic financial conditions, bank reputation, client satisfaction, and overall trust significantly influence client loyalty to the bank. This study provides valuable insights into client behavior and perceptions of banks, emphasizing the importance of factors such as trust, client satisfaction, and bank reputation in shaping client loyalty.

Green HRM practices, organizational commitment, and citizenship behaviour in banks of Hyderabad, Sindh, Pakistan

The study explores the interplay flanked by green HRM practices (GHRMP) and organisational citizenship behaviour (OCB) in banking institutions in Hyderabad, Pakistan, focusing on the mediating impact of organisational commitment. GHRMP are recognised for promoting environmental sustainability and corporate social responsibility. OCB, reflecting discretionary employee behaviour, is pivotal for organisational success. This research aims to ascertain whether organisational commitment mediates the association between GHRMP and OCB in the banking sector of Hyderabad. Data were collected through closed-ended surveys, employing convenience sampling with 200 questionnaires from banks. Smart PLS software facilitated model development and assumption assessment, while SPSS was used for data analysis. Findings reveal that organisational commitment mediates the relationship between GHRMP and OCB in banking institutions. These results underscore the potential of GHRM to enhance organisational commitment, thereby fostering greater OCB participation among employees. This research contributes to academia by elucidating the connections among bank employee commitment, GHRMP, and voluntary employee behaviour. Banks can use these insights to devise and implement GHRM strategies that support environmental responsibility while enhancing staff engagement and organisational citizenship. Integrating sustainability initiatives into HRM processes can cultivate a culture of organisational citizenship and environmental responsibility.

The Role of Islamic Financial Education in Encouraging Customer Investment Behavior in Islamic Banking in Yogyakarta, Indonesia

This paper investigated the moderating effect of Islamic financial education on the relationship between information management and customer perception regarding the increase in investments at Bank Syariah Indonesia, using conventional sampling techniques for data collection from respondents in Yogyakarta. A closed questionnaire comprising 35 items was prepared and tested before the commencement of the study. Path analysis in PLS was utilized as the primary tool to analyze the 141 respondents who completed the survey. The research revealed that the moderating factors have both direct and indirect moderation effects on customer financial investments in Bank Syariah Indonesia, indicating that information management and customer perception are crucial factors in enhancing customer investments. Accordingly, the study was limited to the collection of quantitative data using a semi-structured questionnaire from Yogyakarta, and there is an opportunity to test these findings in other major cities, including those in other developing countries. From a practical perspective, this study elucidates that Islamic financial education plays a significant role in increasing the value of customer investments in Bank Syariah Indonesia, thereby potentially expanding the market share of Islamic banks in Indonesia.

Role of Digital Financial Literacy for Mobile Banking Adoption in Digital Era

Western Odisha, like many other regions in the country, is currently experiencing significant growth in both financial services and smartphone ownership. This accelerate development highlights the increasing importance of digital financial literacy in influencing the adoption and utilization of mobile banking services. The purpose of this study is to investigate how digital financial literacy impacts the use of mobile banking in Western Odisha. To understand the complex relationship between digital financial literacy and mobile banking behavior, a multifaceted approach was taken, including in-depth interviews. A total of 400 samples were collected from four districts in Western Odisha (Bargarh, Bolangir, Boudh, Kalahandi). The findings of the study reveal the intricate connections between financial literacy, digital literacy, digital financial literacy, and mobile banking behavior. It is crucial to address issues such as the rising rate of cybercrimes, the needs of senior citizens, and urban-rural disparities in terms of network coverage and technical infrastructure to promote equal access to mobile banking services. By addressing these challenges, we can fully leverage the potential of digital financial technologies for economic empowerment. Key words- digital financial literacy, mobile banking adoption. digital literacy

The Impact of Central Bank Policy on Aspects of Bank Sharia Financial Behavior in the Money Market

Central bank policy has an important role in influencing the behavior of banks in the money market. This is important because banking movements can affect market stability and the economy as a whole. Therefore, analysis of the impact of central bank policy on bank behavior is very important to expand understanding of how monetary policy can influence the actions of banks participating in money markets. The research results show that central bank policies such as changes in interest rates, mandatory reserve policies, and market intervention have a significant impact on bank behavior. Interest rates set by the central bank can affect bank lending and investment interest, while mandatory reserve policies can affect banks' liquidity and their risk management strategies in the money market. This study also emphasizes the importance of transparency and communication from central banks in implementing policies. Clarity in policy can indirectly help in managing market expectations and help banks respond to changes in monetary policy. This research can be the basis for further research exploring how central bank policies can improve risk and liquidity management, as well as the stability of money markets and the economy. In conclusion, central bank policy has a significant impact on bank behavior in the money market, and policy communication and transparency are important factors in bank risk and liquidity management in order to maintain money market stability in the future.

The dollar versus the euro as international reserve currencies

We begin by examining determinants of aggregate foreign exchange reserve holdings by central banks (size of issuing country’s economy and financial markets, ability of the currency to hold value, and inertia). But understanding the determination of reserve holdings probably requires going beyond the aggregate numbers, instead observing individual central bank behavior, including characteristics of the holding country (bilateral trade with the issuing country, bilateral currency peg, and proxies for bilateral exposure to sanctions), in addition to the characteristics of the reserve currency issuer. On a currency-by-currency basis, US dollar holdings are somewhat well explained by several issuer characteristics; but the other currencies are less successfully explained. It may be that the results from currency-by-currency estimation are impaired by insufficient sample size. This consideration offers a motivation for pooling the data across the major currencies and imposing the constraints that reserve holdings are determined in the same way for each currency. In this setting, most economic determinants enter with significance: economic size as measured by GDP, bilateral currency peg, and bilateral trade share. While one geopolitical factor (congruence in voting in the UN) is typically significant in the expected manner (with the exception of the US dollar), the other geopolitical factor (sanctions) does not enter with significance.

Market Concentration, Price Dynamics, and Profitability in Indonesian Banking: An Empirical Investigation

This research delves into Indonesia’s banking sector’s competitive landscape, examining bank mergers’ effects on performance through the Structure Conduct and Performance (SCP) hypothesis. By reshaping market structure, bank mergers influence subsequent bank behavior and performance. The findings highlight a discernible pattern: an uptick in market concentration accompanies a decline in prices within the banking sector. This implies that mergers often yield economies of scale, enabling banks to offer more competitive rates. However, this reduction in prices directly impacts bank profitability. Moreover, the concentration ratio, a pivotal metric in market analysis, emerges as a significant gauge of industry competition. Serving as a structural measure of competition, the concentration ratio depicts the market share held by leading banks. Intriguingly, diminished competition, as indicated by higher concentration ratios, correlates with decreased profitability for banks operating within this framework. This exploration of Indonesia’s banking sector reveals a nuanced interplay between market structure, bank conduct, and overall performance. Through the SCP hypothesis, the study elucidates how seemingly routine bank mergers can trigger a cascade of effects, influencing market dynamics, profitability, and competitive positioning. Based on thorough analysis, the study furnishes strategic insights for policymakers, industry stakeholders, and the banking community, offering a comprehensive understanding of the ramifications of market shifts and guiding strategies to navigate Indonesia’s banking landscape adeptly.

Addressing the climate–finance interaction in a new light: From green to brown assets disclosure in the banking industry

AbstractThis paper explores the contribution of the banking industry to the decarbonization of the economy in the aftermath of the Paris Agreement. To this end, two complementary indicators are proposed: a carbon balance and a fossil fuel to equity ratio. The main novelty of these indicators is that, beyond traditional approaches in green finance, they take into account the parallel endeavor of banks in fossil fuel financing (so‐called “brown assets”). The results of the inquiry are presented in various maps and graphs. Both elements show that the bank‐induced process of decarbonization is lagging behind that of other industries, which creates a significant risk of financial instability. Changing this banking behavior necessarily involves a climate‐driven reform of the prudential rules on capital requirements; however, given the magnitude of the problem, this might not be enough. Nor is it the most urgent concern. Above all, what this paper makes clear is that the appropriate measurement and disclosure of financed emissions (both “green” and “brown”) is the first crucial step for the correct assessment of climate‐related risk and forms the basis for subsequent policy action.

Optimal monetary policy and the time-dependent price and wage Phillips curves: An international comparison

We investigate the behavior of central banks in seven advanced economies, focusing on how observed monetary policies align with optimal ones as determined by model-consistent welfare measures. Our approach stands out by emphasizing the importance of inertia’s impact on the output gap and the dynamics of prices and wages. We incorporate inertia into our model using duration-dependent adjustments. By integrating this aspect into a simple New Keynesian model, our analysis aims to identify shared patterns and distinctive features in the monetary policy approach of central banks across different countries.

Navigating the Moral Compass: Business Ethics in the Banking Sector

Abstract The banking sector appreciates business morals greatly; additionally, research has been done to find out their effects on organizational success capacities, stakeholders’ trust and the general stability of the financial system. This is a time of increased intricacy and interrelation which means that financial companies like banks especially worldwide’ economic systems being backbone must be ethically sensitive. The paper examines many aspects of corporate morality while applying them within bank operations one such area being transparency where all things done openly without concealment another fairness between different people so none feels oppressed lastly among others CSR which includes activities that benefit not only customers but also employees or even community. Based on a thorough investigation into academic literature, this article explains the real advantages of moral practices in banking. It looks at how ethical behavior encourages lasting customer loyalty and support from other stakeholders as well as strengthens financial institutions’ ability to endure. Moreover, ethical tests that banks come across during this era of technology are outlined while focusing on implications brought about by advanced systems towards data privacy, cybersecurity and fair lending measures. The urgency for the banking sector to take up and firmly establish moral considerations is underscored in this document, which evaluates reputational damage caused by moral breakdowns within the industry as well as on wider economy scale. The development and implementation of robust ethical frameworks are required, which are built on effective control systems to minimize the risks of unethical behavior in banks’ operating activities. These research findings contribute to the ongoing discourse on the place where business ethics and the banking sector intersect. The comprehension obtained can aid in decision making for policies, laws or strategies by financial institutions that want to foster integrity and responsible entrepreneurship.

Tiers of joy? Reserve tiering and bank behavior in a negative-rate environment

Negative interest rate regimes typically involve reserve tiering to exempt a portion of bank reserves from negative rates. We study the effects on bank behavior of a large and unanticipated change in reserve tiering by the Swiss National Bank that generated substantial variation across banks and was not related to other events. We find a sizable reallocation of liquidity and deposits within the banking system. Higher exemptions reduce the pass-through of negative rates to deposit rates, especially at retail banks with limited access to the interbank market. Effects on lending are moderate and suggest that higher profitability lessens pressure to reach for yield. Our results are informative about the transmission channels of monetary policy through the banking sector more broadly. We discuss how effects of reserve tiering may differ from effects of changes in interest rates, emphasizing that reserve tiering affects the economy through a narrower set of channels.

Neobank adoption: integrating the information systems effectiveness framework with the innovation resistance model

PurposeThis study aims to integrate Delone and McLean’s information system success (DMISS) model with the innovation resistance model to evaluate the relationship between behavioural intention to use (BIU) and innovation resistance in the context of neo-banking. The primary objective of this study is to identify the drivers of neo-banking adoption and the barriers to its adoption and incorporate constructs such as e-trust (ETR) and personal innovativeness (PIV) to provide a more comprehensive understanding of the factors influencing neo-banking adoption.Design/methodology/approachA structured survey-based questionnaire was used to gather data from a diverse sample population in India. The Partial Least Squares Structural Equation Modeling (PLS-SEM) model was employed to further examine the adoption of neobanking services and users' intention to use neobanking services.FindingsThis study reveals a significant correlation between BIU and the uptake of neobanking services, demonstrating the value of consumers' readiness to embrace these offerings. However, resistance to usage has emerged as a major obstacle for consumers concerned about data security, technology reluctance and perceived risks associated with digital-only neobanks.Research limitations/implicationsAnalysing the driving and restraining factors will provide substantial information on the formation of consumers' decision-making processes in the Indian banking industry, which is undergoing rapid digital transformation. This information is of great importance to scholars, practitioners and policymakers, as it highlights the factors that may facilitate or impede the adoption of neobanking in India. The outcomes of this analysis will be of particular interest to researchers, experts and stakeholders in the field as they will provide valuable insights into the dynamics of consumer behaviour in the Indian banking sector.Originality/valueThis study represents an initial effort to examine BIUs and usage resistance within the rapidly developing neobanking sector in India. The findings of this study build on the existing research in this area and contribute to the ongoing discussion on the adoption of neo-banking.

МОДЕЛІ БІЗНЕСУ УКРАЇНСЬКИХ ОЩАДНИХ БАНКІВ

In the banking system, savings banks represent a special component, as they form their resource base mainly due to the accumulation of population savings. Problem Statement. Ukrainian savings banks are a factor in ensuring financial stability, but at the same time they are vulnerable to depositors’ panic in conditions of systemic stresses. Therefore, the analysis of their activities is important for understanding the prospects of the banking system. Savings banks in Ukraine differ significantly in scale and level of business technology. Leading savings banks are planned by the state for privatization, so they are designed to improve their investment attractiveness, at the same time, the status of state ownership gives such banks additional advantages in the market. The purpose is a comparative analysis of the business models of savings banks in Ukraine and the behavior of such banks on the market. Methods. The authors used the methods of comparative analysis, logical generalization, analysis and synthesis. Results. In Ukraine, savings banks are divided by origin into two categories ( state and private capital), and by a business model into those, focused on lending to business clients and those with a balanced composition of the loan portfolio. The monopoly of the state bank was broken by the entry of banks with private capital to the market. Savings banks are identified based on the ratio of funds raised by individuals to the total amount of balances on customer accounts. A blueprint of two business models for the savings bank segment was built, the structure of assets and liabilities, the development of the branch network and market positions in terms of deposits were compared. The analysis of the efficiency of a sample of savings banks was carried out and compared with the indicators of the banking system (profitability, return on operating expenses, profitability of the loan portfolio, cost of funds of individuals, the branching of branch network), as well as the impact of the business model on the investment attractiveness of banks was assessed, the volumes of savings and allocation of funds in loans to individuals were compared. Conclusions. The research made it possible to identify a specific group of banks with heterogeneous business models: firstly, banks that use public funds mainly to finance business clients, secondly, banks that have a relatively balanced credit portfolio for individuals and legal entities. The segment of Ukrainian savings banks is clearly dominated by two large state-owned banks, and given the state of war and citizens' trust in the state itself, there is no reason to expect a change in leaders. Digitization of products and processes will allow savings banks to compensate for the reduction of the branch network, but other banks also take advantage of this opportunity. and return on investment in technological innovation projects will bring effect in the medium term. To a large extent, the amount of savings accumulated by banks depends on two factors - customer trust and assessment of service quality. Savings bank managers should pay primary attention to this. Excessively high dependence of banks on the funds of individuals can be considered as a disadvantage, rather than as an advantage, if a bank itself works inefficiently.

Public Debt and It’s Impact on Bank Behaviour and Financial Efficiency: Ghana in Perspective

This study explored the impact of public debt on bank behaviour and financial efficiency in Ghana amid rising global and national debt levels exacerbated by the COVID-19 pandemic’s economic repercussions. An exploratory research design employing a quantitative approach was used to analyze the perceptions of 201 banking professionals across Ghana. The study utilized cluster and purposive sampling techniques to ensure a representative sample. Data were collected on banks’ risk-averse behaviour, credit availability, interest rates, and investment decisions in relation to public debt levels, using survey instruments and regression analysis to quantify the impacts. The findings reveal significant concerns among banking professionals regarding the influence of high public debt on conservative lending practices, increased interest rates, reduced credit availability, and adverse effects on banks’ profitability and the financial system’s stability. Regression analysis confirmed a negative relationship between public debt and financial efficiency, indicating that rising public debt levels may hinder the sector’s operational effectiveness. These results underscore the critical need for strategic fiscal management to mitigate the risks associated with high public debt levels on financial stability and development. Policymakers and financial institutions are urged to consider measures that promote financial sector efficiency and sustainable debt levels, including fiscal consolidation strategies, diversification of investment portfolios, and enhancement of risk assessment models. This study contributes to the empirical discourse on the effects of public debt on financial development by providing insights specific to the Ghanaian context, which has been relatively underexplored.

Factors affecting Stock Price Behaviour of Commercial Banks in Nepal Stock Exchange

This research investigates how factors such as Dividends Per Share (DPS), Earnings Per Share (EPS), Price-Earnings Ratio (PER), and Net Worth Per Share influence the Market Price Per Share of commercial banks in Nepal. The study analyzed the panel data from four commercial banks, consisting of 40 observations, to evaluate the correlation and influence of factors affecting stock price movements. In this study, secondary panel data covering ten years (2070/2071-2079/2080) has been used. Based on the results of this investigation, there is a significant positive correlation between the Market Price Per Share and the Dividends Per Share, Price-Earnings Ratio, and Net Worth Per Share but a negligible effect of Market Price Per Share and Earnings Per Share of commercial banks.

Economic policy uncertainty around the world: Implications for Vietnam

This paper reviews the literature on the impacts of uncertainty on various aspects of different economies and highlights the need for research to be carried out in the Vietnamese context. The findings of notable theoretical works suggest that high levels of uncertainty can have significant temporary impacts on economic outcomes, including a decrease in total output, employment, and productivity growth. We summarize the effects of uncertainty on firm behavior, bank behavior, and the financial market, factors that affect the economy, starting with the US context. We continue to examine global studies on the international economy and discuss research on the Asian economy, where we find some inconsistent results and discover new insights on the impact of uncertainty on the economy, revealing a need for continued research in each unique country setting. Given the limited evidence of the impact of uncertainty in the Vietnamese context, we highlight the value of further local research, recommend potential areas for future research, summarize the existing measures of uncertainty index, and suggest the construction of a new uncertainty index for Vietnam.