Domestic Financial Institutions Research Articles

PROCESS OF UKRAINE'S FINANCIAL SECTOR INSTUTIONALIZATION AND ROLE OF CORPORATE SECURITIES MARKET

This article deals with the characteristics of the institutionalization process of the financial sector in Ukraine and the role of the corporate securities market in it. It is determined that the modern domestic financial sector is characterized by significant institutional imbalances, primarily due to the insufficient effectiveness of state policy in this area. For many years, banks have been the key players in the domestic financial sector, which significantly reduced the level of financial inclusion. The development of non-banking financial institutions has been fragmentary, significantly undermining public trust in the financial sector. In particular, this concerns the activities of credit unions in Ukraine, where the market volumes of private pension provision have been minimal for a long time. Some existing institutional imbalances were overcome through the rapid digitalization of certain segments of the financial market, but the overall level of financial inclusion remains low. The process of institutionalization of the domestic financial market occurred against the background of the weakness of the corporate securities market. The article notes that this situation was a consequence of the lack of interest from joint-stock companies in market methods of capital attraction. Along with this, domestic financial institutions are not interested in investing in corporate securities. Thus, the reluctance of public corporations to place their securities on the market coincides with a peculiar investment strategy of financial institutions. As a result, the volumes of the primary corporate securities market in Ukraine are minimal (especially in the stock market), and government securities dominate the secondary market for a long time. This situation poses a series of threats to Ukraine's economic development and requires appropriate actions from the state aimed at the activation of the corporate securities market. It can now be stated that domestic public corporations are non-competitive in the global financial space, which destructively affects their market positions.

Does Cross-Border-Establishment Improve Competition and Performance of Indonesia’s Financial Sector?

This study examines the effects of cross-border establishment of financial institutions on competition level in Indonesia’s financial sector. We use sample data on all conventional banks, securities firms, life and general insurance companies from 2013-2020. To measure competition, we use Lerner index, Boone indicator and Panzar-Rosse. Our analysis shows that the entry of foreign financial institutions may increase the competition in the financial sector. Further analysis shows that the increasing competition have positive impact to profitability and intermediation, reflected by the return on asset, loan ratio, transaction value, and insurance premium income to total asset ratio. However, foreign financial firms tend to have higher market power compared to domestic counterparts due to the efficiency in doing their businesses. Hence, domestic financial institutions need to boost efficiency, particularly through the adaption of technology and capacity enhancement of human resources, in order to compete with more advanced foreign financial firms.

Implementation of Aaoifi Standard No.35 by Saudi Islamic Banks: Opportunities and Challenges

Purpose of the study: The research aims to study and analyze the reality of reserves in Islamic banks in light of Financial Accounting Standard No. 35 issued by AAOIFI in 2018. In addition to determining the accounting irregularities or errors, in the practice of accounting and disclosure related to reserves in Saudi Islamic banks. Theoretical Framework: The research is based on the financial standards of the Islamic banks. Recent financial crises have prompted increased attention from the international community on the need for domestic financial institutions to be strengthened in order to better withstand subsequent emergencies. To ensure national and international financial stability, standards have been developed and implemented to encourage better policies and stronger institutional and market foundations. The international standards community's initiatives provide a comprehensive approach to promote the financial standards of the Islamic banks. It is crucial that self-assessments be supplemented with an impartial external check on conformity with standards. Design/Methodology/Population: The researchers applied the inductive analytical approach for evaluating the financial standards of the Islamic banks. The study population consists Islamic banks In Saudi Arabia: Bank Albilad, Al-Rajhi Bank, and Alinma Bank. The research analyzed the financial statements of three Islamic banks. Findings: The research concluded that all Saudi Islamic banks do not apply the accounting standards issued by AAOIFI. These bank's financial statements do not reflect the reality of their financial position, because they only apply traditional accounting standards. The Saudi Islamic banks do not apply the accounting standard issued by AAOIFI Standard No.35. The reasons behind the non-application of Islamic accounting standards issued by the AAOIFI in Saudi Islamic banks are the Saudi Banking Law and the instructions of the Saudi Central Bank. In addition, shareholders in Islamic banks bear all reserves and provisions. Research, Practical and Social Implications: The research suggests that banking supervisory authorities in the Kingdom of Saudi Arabia have to take the necessary measures to amend the laws and instructions related to Islamic banks., and to follow up efforts by AAOIFI with central banks in the countries in which Islamic banks operate to oblige Islamic banks to the accounting standards issued by AAOIFI. Originality/Value: The research is unique in identifying the importance of the AAOIFI standards in improving the financial standards of the Islamic banks.

Is financial technology a complement or substitute for domestic financial institutions in Ghana?

PurposeThis paper aims to examine whether financial technology is complementing the performance of domestic financial institutions or substituting their performance in Ghana.Design/methodology/approachThe paper used data from the Bank of Ghana Payment System Statistics and Time Series Data of the Bank of Ghana from 2012 to 2021, by using autoregressive distributive lags estimation technique.FindingsThe results showed that in both the long run and short run, financial technology has a significant negative impact on bank performance, indicating that fintech serves as substitutes rather than complements for Ghanaian banks. These results suggest that there must be a critical review on the interoperability policy in Ghana and that banks should take advantage of the financial technology to increase profit.Originality/valueBased on the authors’ study, no empirical work has been extensively done in the Ghanaian context by examining how financial technology serves as either a complement or substitute for domestic banking institutions. This paper focuses on exploring the key definition of financial technology in Ghana and how transactions through these media are affecting or improving the performance of banks.

Factors involved in Economic Development and their Impact on State-Building in Malaysia

The successful history of poverty elimination and impressive economic development in Malaysia for the post-colonial period regarded a worth model for growth in developing world. The question raised in this achievement was; how economic development affected on the state-building in the country? Therefore, the motive of the study is to examine the determinants of economic development on state-building. Autoregressive distributed lag (ARDL) model employed to test economic factors affecting the state-building. The study covered data spanning from 1970-2017. The long-run co-integration in the model has confirmed, and econometric diagnostic tests are robust. The study findings show that human capital, oil rent, and per capita income, positively and significantly affect state-building in the long-run. In the short-run, human capital and oil revenue effects positively and significant. Population growth, democracy, inflation, and financial development have confirmed a negative and significant impact on state-building. Policy implication has highlighted the importance of human capital development, macroeconomic stability, and population growth in Malaysia's state-building. Demographic transition exerts a considerable negative effect on state-building in the long-run, affecting the economic health and steady-state growth. Financial development inserting a negative impact on state-building to promote development. The study recommended that the economic policymakers and relevant bureaucracies correct the fiscal deficit and ease domestic financial institutions into the credits based on the findings. Malaysia is facing a demographic threat in the long run due to the aging population and low fertility rate; therefore, it have to re-address the population policy.

Threshold effects of financial development on foreign listing: the roles of venture capital in developed and emerging countries

ABSTRACT This paper examines financing abroad from the perspective of international financial development. We find that foreign listing activities are significantly associated with financial development indices, such as stock trading, domestic credit, soundness of banks, venture capital availability and financing by local equity markets. The spillover effect is more pronounced in emerging countries. A threshold model with a macro dynamic panel of 37 countries from 2006 to 2020 suggests that foreign listings and financial development (stock trading and venture capital availability) follow an inverted U-shaped pattern, while foreign listings and domestic credit follow a diminishing pattern. The policy and managerial implications indicate that countries face varying demands for foreign listings at different stages of financial development. When making decisions on seeking foreign capital policymakers should follow closely the changes in domestic financial development and institutions.

A Study on the Application of Quantile Regression Equation in Forecasting Financial Value at Risk in Financial Markets

Abstract With the development of the times and the progress of science and technology, the financial market is constantly reformed and China’s financial industry is gradually modernized. However, China’s economy has been in the stage of rough growth for a long time, which has led to low efficiency in the allocation of financial resources and unreasonable use of funds, and this has seriously restricted the whole social production activities and the stability and sustainable and healthy development of the national economy, so the prevention and control of financial risks is particularly important.Therefore, how to identify and measure the risks in China’s financial industry and manage and invest them in a reasonable way is a very serious issue facing China’s financial institutions today. On the other hand, due to the continuous development and innovation of the financial market, China’s financial industry has been gradually reformed. However, due to the imperfection of China’s economic system and related laws and regulations, some non-performing assets and irregularities in the operation of domestic financial institutions have emerged, and instability in the financial market has also emerged. These phenomena make China’s financial industry face huge financial risks in the process of development.

Is Financial Institution Management Effective to Reduce Problems Related to Information Asymmetry in Taiwan?

Abstract Thanks to the deregulation of financial regulations since the 1990s, the domestic financial institutions had ever been in excessive amounts for a long time. In order to expand their business scope and market share, they often adopted a looser or simple review mechanism, which led to a decline in the asset quality of financial institutions and an upward trend in overdue loans. As a result, the credit card debt crisis caused by the information asymmetry and the derived serious social problems ensued . Under the pressure of public opinion, the financial authority was forced to promote the debt negotiation mechanism in 2005 and even led passing the Consumer Debt Clearance Regulations in 2007. This article analyzed the statistics of consumer finance related to public and private banks, trying to explain whether the problems related to information asymmetry was reduced and whether financial institution management was effective. The result revealed that the number of valid cards, revolving interest rates, and overdue ratios fell in tandem after the financial authority intervened in the market. Especially when the credit card debt crisis and the social problem were showed under control, it was proven that financial institution management is essential and effective to reduce problems related to information asymmetry in Taiwan. JEL classification numbers: G01,G21,G28. Keywords: Financial Institution Management, Credit Cards, Card Debt Crisis, Information Asymmetry, Adverse Selection, Moral Hazard.

Ways to Reform the Banking System of Ukraine to Ensure the Financial Stability of Economic Entities

The article analyses the main directions of reforming the banking system of Ukraine. The relevance of the study is conditioned upon the need to improve the stability of the country's financial system. The reason for the decline in the economic situation is the political situation in Ukraine. The purpose of the study is to clarify ways to ensure the financial stability of enterprises for long-term and sustainable economic development. In the course of the research philosophical and general scientific methods were used , in particular historical-logical, economic-statistical, factorial methods, including theoretical and comparative analysis. The author assesses the consequences of the application of some methods at certain stages of development of the banking system, identifies the main priority areas of its development; the approaches to definition of essence and features of development of financial resources of the enterprise are analysed; the relationship between the financial stability of the state structure and the financial stability of the enterprise is identified; measures to ensure the financial stability of the enterprise, and opportunities to improve the system of ensuring and forecasting financial stability. The rapid development of information technology, which allows Ukrainian banks to expand the range of services; increasing the financial literacy of clients and implementing programs aimed at maintaining the stable condition of domestic financial institutions. A detailed analysis of management elements, functions and principles of development of financial resources of the enterprise is given. The analysis allows stating that the financial resources of the enterprise should be defined as a set of own funds of the organization and external financing, which can be used to form fixed and current assets needed to conduct business and support expanded production. Having a high transformative capacity, the financial resources of the enterprise are the main component of financial potential, a factor of economic and social development. The article identifies the factors influencing the financial stability of the enterprise, and areas for improving public financial control in the context of financial security of Ukraine. The urgency of the researched problem is determined by the need to develop a strategy of financial security of Ukraine in view of the problems that complicate it. Analysis of the financial stability of the enterprise is the most important step in assessing its performance and financial and economic well-being

РОЗШИРЕННЯ ФУНКЦІЙ ВНУТРІШНЬОГО КОНТРОЛЮ БЮДЖЕТНОЇ УСТАНОВИ ДЛЯ ПРОТИДІЇ КОРУПЦІЙНИМ ЗЛОЧИНАМ

The results of the struggle of anti-corruption bodies against corruption crimes are analyzed. It has been established that corruption crimes are of various natures and have tended to increase rapidly in recent years, especially crimes related to misappropriation, embezzlement or misappropriation of property through abuse of office. At the same time, the number of indictment proceedings and convicted persons (according to the sentences that have come into force) is decreasing from year to year. It has been found that most often corruption crimes are committed by law enforcement officers and most of them are related to bribery. It is established that compliance with international corruption is an effective tool for combating corruption, which, at first, has gained wide practical application as a management technology. It is determined that compliance is currently widely used by domestic financial institutions and companies focused on Western markets in order to prevent, detect and minimize the consequences of corruption schemes. The need for synergies between external and internal control in order to detect and prevent corruption in the use of public funds is pointed out. The necessity of introducing the compliance function into the system of internal control of budgetary institutions in order to combat corruption, which permeates all areas of public finance, is substantiated. It is proposed to entrust the implementation of the compliance function in the budget institution to a specially appointed person or a structural unit. The priority actions of the management of the budgetary institution for the formation of its own unique compliance control system have been identified. It is noted that it is necessary to form the perception of compliance as an integral function in the management of the budgetary institution, especially as a function of assistance, not punishment. Further directions of scientific research related to the development and formation of the compliance function of the internal control of the budgetary institution, aimed at combating corruption and promoting legal, economic, efficient, effective and transparent use of public finances.

ПРИМЕНЕНИЕ ИННОВАЦИОННЫХ ЦИФРОВЫХ РЕШЕНИЙ НА ФИНАНСОВОМ РЫНКЕ

Innovative digital technologies and their application in the management of financial institutions are the trigger for the introduction of new regulatory instruments. The concept, essence and significance of regulatory technologies is determined by the transformation of the economy and the transition to high-tech solutions for business structures. Digital technologies in the financial sector are used not only as auxiliary tools of activity, but also transform the service market itself, determine the trend of development, as well as the nature of interaction of subjects. The article discusses the main types and classes of financial digital regulators, describes the ways of their application in practice. A comparative analysis of the level of digitization of domestic and foreign financial institutions is carried out.

СУЧАСНІ ІНФОРМАЦІЙНІ ТЕХНОЛОГІЇ НА РИНКУ ФІНАНСОВИХ ПОСЛУГ УКРАЇНИ

The main trends in the development of the financial services market of Ukraine are globalization, growing competition, capital consolidation, diversification of services, digitalization, introduction of innovative products and technologies. Thefull-scale armed invasion of the aggressor country into the territory of Ukraine transformed the activities of domestic finan-cial institutions, putting them in front of completely untypical challenges that required prompt response. At the initiative of the National Bank of Ukraine, financial institutions of the state introduced “credit vacations” for clients, but this measure has a short-term character. The country report an increase in credit risk and significant losses. The regulator is expected to take a set of measures to support Ukrainian financial institutions, recapitalize banks and establish a grace period in order to restore their competitiveness in the market. In turn, financial institutions make every effort to adapt to work in martial law. This article substantiates the potential of new information technologies in the development of the modern financial technolo-gy market. The authors focus on describing the role of blockchain technologies, Big Data Analytics, cloud technologies, Arti-ficial Intelligence, Internet of Things in the activities of financial institutions. It is proved that the use of digital technologies can speed up and simplify the process of providing financial services, optimize the cost structure of financial institutions,improve their management, as well as increase the level of household trust to the financial institutions. The expediency of forming long-term partnerships between financial institutions and FinTech companieswas emphasized. Among the prospects for further research, the authors highlighted the need to develop effective mechanisms and tools to protect information sys-tems and data of financial institutions from hacking, leaks and cyber-attacks.

METAPROGRAM APPROACH IN THE PROCESS OF SELECTION AND ASSESSMENT OF PERSONNEL IN FINANCIAL INSTITUTION

The aim of the article is to deepen the theoretical foundations and develop practical recommendations for the use of meta-program approach in the selection and evaluation of personnel in domestic financial institutions. The article summarizes various approaches to the definition of «metaprogram» in the field of personnel management and proposes its own definition of this category; the place and value of metaprograms in the job profile are determined; a standard metaprogram profile of the position of a financial institution risk management specialist is proposed and recommendations are provided for building a competency interview and interpreting its results in order to identify relevant metaprograms of an employee or candidate for this position. It has been proven that the main condition for successful detection of metaprograms in the interview processis the use of the right questions and the correct interpretation of answers to them, which helps to identify stable deep psychological attitudes that determine human perception of objective reality and response to organizational methods. Metaprograms are a kind of filter of information coming from objective reality to human consciousness through the senses, turning it into subjective perception and the corresponding reactions associated with it. The use of a metaprogram approach in assessing a person’s suitability for the position, along with classical, traditional methods, avoids errors in the selection and evaluation of staff. Defining and taking into account employee metaprograms is also the key to more effective management. In addition, it allows him to find a job in which he will be most effective, and the activity itself, in accordance with the internal attitudes of the employee, will bring him maximum pleasure. Taking into account metaprograms allows you to use adequate tools to stimulate work, gives an understanding of the causes of certain interpersonal relationships in the team, helps prevent conflicts and high staff turnover.Keywords: metaprogram, human resources management, personnel, financial institution, job profile.JEL Classification M12, M51, G21Formulas: 0; fig.: 1; tabl.: 1; bibl.: 16.

Investment Analysis for Submarine Power Cable Project Between Belakang Padang Island and Sambu Island

PT Pertamina (Persero) Riau Islands proposed the installation of electrical power for the fuel storage tank terminal on Sambu Island with a capacity of 7 MVA. Currently, Sambu Island is still receiving electricity by operating a Diesel Power Plant (PLTD) with diesel fuel.
 Seeing that the nearest electricity supply from Sambu Island is Pulau Belakang Padang Electricity, then as a business solution to be able to meet the demand of PT Pertamina (Persero), PT PLN Batam will build a submarine cable between Sambu Island – Pulau Belakang Padang to distribute electricity from the Power Plant in Batam to Sambu Island through the Belakang Padang Island.
 PT PLN Batam must obtain a reference regarding the feasibility of investing in the construction of a submarine cable between Belakang Padang – Sambu Island. To get this reference, an investment analysis must be carried out to determine the business feasibility of this submarine cable development.
 The business feasibility parameters to be analyzed are NPV (Net Present Value), IRR (Internal Rate of Return), BCR (Benefit to Cost Ratio) and PBP (Payback Period). To further refine the business feasibility analysis, a sensitivity analysis was carried out to see the effect of changes in investment parameters.
 After conducting investment analysis, it was found that the Capital was carried out with a portion of 30% from equity and 70% loans from domestic financial institutions after comparing with foreign financial institutions, and the construction of this submarine cable was declared feasible because it met all the feasibility parameters. business, where NPV > 0, BCR > 1, IRR > Discount Rate and PBP < Loan Tenor.
 With the construction of the submarine cable, PT PLN Batam will get a potential profit of Rp. 12.358.560.473, - in the first year after the operation of the submarine cable with an electricity tariff of Rp. 2,054 /Kwh. This electricity tariff is cheaper than the electricity tariff using PLTD of Rp 3,000/Kwh.

Foreign direct investment, financial development, energy consumption, and air quality: A way for carbon neutrality in China

Air quality is a social, economical, and health issue for fast-developing countries such as China. Due to the overuse of nonrenewable energy, industrialization, and the population put pressure on air quality, which seriously threatens public health and economic growth. This study focuses on air quality and also aims to investigate the short-and long-run correlation between foreign direct investment, energy consumption, domestic credit, and financial development. The Autoregressive distributed lag model and the Granger non-causality test were carried out over the period from 1985 to 2018. The main findings of this study show a positive and significant long-run impact of energy consumption on air quality. In addition, domestic credit and financial development similarly show a significant positive short-run association with air quality. Moreover, the unidirectional causality correlation running from foreign direct investment and domestic credit to air quality was concluded by the Granger non-causality test. Considering the empirical analysis, this study suggests that domestic financial institutions should offer credit to industries at a low-interest rate in order to help them to switch from non-renewable to renewable energy consumption towards the promotion of sustainable and healthy air quality.

Анализ и оценка киберугроз национальной финансовой системе России в цифровой экономике

The relevance of the topic of this scientific article lies in the need for a theoretical and practical study of the problem of escalating numbers and quality of cyber threats and attacks committed against institutions of the Russian financial system, implying their safe and sustainable development being ensured in Industry 4.0. The purpose of the article is a comprehensive analysis of cyberthreats facing the national financial system of the Russian Federation in the context of economy digitalization. The subject of scientific research is the processes of ensuring national security of the Russian Federation’s financial system in the digital economy. In the process of research, the authors relied on general scientific methods (observation, comparison, measurement, analysis and synthesis, as well as logical reasoning), specific scientific methods (static analysis, expert assessments, and graphical method), and the foresight method. The validity and reliability of the results of scientific research are ensured by the correctness and rigor of the logic and research scheme construction. Scientific and practical research of Russian and foreign scientists in the field of cybersecurity, digital economy and public administration was used as a methodological and fundamental basis of the study. Various approaches to key categories—digital sovereignty and cyberwar—have been systematized, and it has been established that the most pressing financial challenges and threats to the digital economy of the Russian Federation are as follows: hacker attacks, financial sabotage in the financial market, design and launch of social engineering trojans, infrastructure attacks on IoT (Internet of Things) networks, and sale of hacker tools with open source. The authors have analyzed the number and quality of cyberattacks on domestic financial institutions in 2016–2020; summarized the losses caused by cyberattacks to financial institutions; and identified the main scenarios for the development of cyberthreats and cyberattacks for the national financial system. As the main conclusion, the authors determine that further elaboration of the issues of ensuring financial institution cybersecurity in the digital economy requires justification and implementation of specific programs and activities carried out both by commercial banks within the framework of individual strategies for ensuring digital security, and by authorities and management with positions of ensuring the digital sovereignty of the state.

Shadow banking and cross-border capital inflows: Does the development level of financial institutions matter?

This paper examined the individual and simultaneous effects of cross-border capital inflows and domestic financial institution development indicators (depth, access, and efficiency) on the level of shadow banking assets. Using a panel dataset of 23 countries over the period 2005–2017, all three domestic financial institution development indicators are tested while controlling for their interaction with two types of cross-border debt inflows (cross-border debt inflows to banks and other sectors). This study yields three main findings. First, individually, cross-border debt inflows to banks harm the level of shadow banking assets. Second, the development of domestic financial institutions forms the foundation of the shadow banking system. Third, the development level of domestic financial institutions determines, to a large extent, whether cross-border debt inflows will impact the level of shadow banking assets. This study highlights the importance of cross-border capital inflows and the development level of financial institutions to the level of shadow banking assets and how the interactions between these variables contribute to the level of shadow banking assets.

What is the impact of financial depth on economic growth within middle income countries?

This paper utilizes the Least Squares Dummy Variables (LSDV) technique in investigating the effect of financial depth on economic growth within a sample of middle-income countries, over the period 2005–2017. The research finds that financial depth has a negative impact on real GDP growth within middle-income countries. This result is robust to the use of alternative measures of financial depth, the use of per capita GDP growth as a proxy for economic growth, the inclusion of dummy variables to control for the 2007–2010 global financial crisis, the exclusion of countries with high average growth as well as across income levels. Based on its findings, this study recommends the need for robust regulations to ensure that the credit facilities of domestic financial institutions are channeled towards productive investments rather than debt servicing.

THE CONTRIBUTION OF FDI AND FINANCIAL DEVELOPMENT ON ECONOMIC GROWTH IN SRI LANKA

The present study investigates the relationship between financial development, Foreign direct investment and economic growth in Sri Lanka for the period 1980 to 2019 by applying the Augmented Dickey-Fuller Unit root test along with the ARDL approach in process of achieving the desired objective. The outcome of this study shows that except GDP and FDI all other variables such as Capital investment as a percent of GDP (CI), Bank credit to the private sector as a percent of GDP (BCP), net foreign direct investment inflows in % of GDP (FDI) are stationary at first difference. The findings reveal that net foreign direct investment inflows are a positive relationship with economic growth in the long run. It means a one percent increase in net foreign direct investment inflows increases the GDP by 0.826439 percent. At the same time, a one percent increase in bank credit to the private sector decreases the GDP by 0.864320 percent. Moreover, in the short run FDI, CI and BCP have a positive and significant impact on GDP. Diagnostic tests such as normality test, heteroskedasticity and serial autocorrelation are employed to validate parameter estimation outcomes. Further, the stability of the variables confirms by the CUSUM test. The country should propose Strategies to boost the growth of efficient domestic financial institutions and encourage policy to attract greater FDI inflows that meet the needs of the knowledge-based economy.

Exploring Customer Participation and Value

Emerging marketing perspectives show that customer participation creates new opportunities for value creation. A perspective in the marketing section should be highlighted, a new opportunity must be emphasized, and customer participation should be used as a means to define the relationship benefits through their participation. The goal of customer participation is to create a high-value service process by creating cooperation with customers. This study describes and develops hypothesis verification. In the context of professional financial services in Taiwan, this study explores the effect of customer participation on value creation and satisfaction from customer and employee perspectives. It also analyzes the effects of different customer capabilities and employees’ emotional intelligence. The source of data collection is a total of 383 customer questionnaires from domestic financial institutions of two types of bank (public and private) to verify (1) how customer participation affects customer satisfaction and employee job satisfaction through relationship value creation, (2) how customer ability affects the relationship between value creation and satisfaction, and (3) how employees’ emotional intelligence affects the relationship between relationship value creation and job satisfaction. This study uses the structural equation model to verify the research hypothesis and obtains the following results through empirical research: 1. Customer participation affects customer satisfaction through relationship value creation. 2. Customer participation does not completely create positive employee relationship value, which may increase work pressure. 3. Interference results show that customer ability can promote customer satisfaction, whereas employee emotional intelligence does not necessarily affect the relationship between employee relationship value creation and job satisfaction. These results contribute to the banking industry. Customer participation can promote value creation by arranging customers and financial specialists to have an appropriate interactive relationship and professional services