Egyptian Banks Research Articles

Basel Accord and Lending Behavior: Evidence from Mena Region

In 1988, an agreement was reached in Basel to set the common requirements of bank capital towards promoting the soundness and stability of the international banking system. Banks are required to hold capital in proportion to their perceived risks, which may have caused a credit crunch, resulting in a significant reduction in the supply of credit. We investigate the direct link between the implementation of the Basel Accord and lending activities using a data set spanning annual observations covering 1989-2004 for banks in Egypt, Jordan, Lebanon, Morocco, and Tunisia. The results provide clear support for a significant increase in growth following the implementation of capital regulations, in general. Despite higher capital adequacy ratio, banks expanded and assets growth. Credit growth appears to be driven by demand fluctuations attributed to real growth, cost of borrowing and exchange rate risk. Overall, the effects of macroeconomic variables, in contrast to capital adequacy, appear to be more dominant in determining growth, regardless of the capital adequacy ratio, and variation across banks by nationality, ownership, and listing.

Neural nets versus conventional techniques in credit scoring in Egyptian banking

Neural nets have become one of the most important tools using in credit scoring. Credit scoring is regarded as a core appraised tool of commercial banks during the last few decades. The purpose of this paper is to investigate the ability of neural nets, such as probabilistic neural nets and multi-layer feed-forward nets, and conventional techniques such as, discriminant analysis, probit analysis and logistic regression, in evaluating credit risk in Egyptian banks applying credit scoring models. The credit scoring task is performed on one bank's personal loans' data-set. The results so far revealed that the neural nets-models gave a better average correct classification rate than the other techniques. A one-way analysis of variance and other tests have been applied, demonstrating that there are some significant differences amongst the means of the correct classification rates, pertaining to different techniques.

Competition and Privatization Of the Egyptian Banking

Egypt's efforts to liberalize its financial sector in the 1990s have been impressive. Egyptian authorities have been successful in reversing more than three decades of interventionist policies. The fundamental building blocks of this liberalization process now seem solid. They include a reduced fiscal deficit, and the unification and freeing of exchange rates, interest rates, and lending decisions from administrative control. The initial privatization of large banks has removed some of the extensive ownership links between banks—one likely cause of uncompetitive banking. The benefits of reform are beginning to show: inflation control consistent with growth rates, confidence in local currency, and buoyant stock market activity buttressed by numerous prominent privatizations. Capital flows into the economy have also been much stronger. Nevertheless, the transformation of the Egyptian financial sector into a modern marketoriented system is still in its infancy. In the future, economic changes which policies can affect should go hand in hand with institutional and attitudinal changes which are potentially more difficult to bring about. Policy makers must continue to work hard to build on the foundations they have laid thus far.

Privatization, State Ownership, and Bank Performance in Egypt

Summary In this study, we address the financial and operating performance of a sample of 12 Egyptian banks from 1996 to 1999, during which time control was transferred from the state to the private sector. Following privatization, the results indicate that some profitability and liquidity ratios for privatized banks decline significantly, but other performance measures are virtually unchanged. Antithetically, the results indicate that the relative performance changes of privatized banks were better than those of mixed banks with majority state ownership but worse than those of banks with other ownership forms (private, state-owned, and mixed private ownership). However, the study finds a strong evidence to support the theory and previous empirical findings that banks with greater private ownership perform better.

Best practices: Research, finance, and NGOs in Cairo

In this article, I examine how artifacts of social-science research were incorporated into survival strategies of poor residents of the global South in the 1990s under neoliberalism. I draw on ethnographic research in Cairo among bankers, borrowers, and nongovernmental-organization (NGO) members to engage recent debates in anthropology about finance and knowledge practices. I argue that the incorporation of “best practices” and microenterprise lending into banking in Egypt helped create a new kind of “multiplier effect” related to the one made famous by John Maynard Keynes in economics and to the conviction among some Egyptians that research artifacts held the key to improvement of their life chances.

The Impact of Capital Requirements on Banks' Performance: The Case of Egypt

In 1991, the Central Bank of Egypt increased the minimum capital requirements for the banking industry vis-a-vis risk weighted assets to 8 percent, along the lines of the Basle Committee on Banking Supervision. We investigate the effects of capital regulations on cost of intermediation and profitability. A number of factors have pushed up an increase in the cost of intermediation in the post-capital regulation period: higher capital to assets ratio, an increase in banks' size and a reduction in inflation. The reduction in banks' concentration and output growth countered these effects. A number of factors contributed positively to banks' profitability in the post-regulation period: higher capital requirements, the reduction in implicit cost and the increase in banks' size. The reduction in economic activity had counter effects on bank's profitability. Overall, the results support the Central Bank's efforts to enforce capital regulations towards improving the performance of the banking sector in Egypt.

A Study of the Perceived Security Threats of Computerized Accounting Information Systems: The Case of Egyptian Banking Sector

A Study of the Perceived Security Threats of Computerized Accounting Information Systems: The Case of Egyptian Banking Sector

Perceived Security Threats of Computerized Accounting Information Systems in the Egyptian Banking Industry

This paper investigates the perceived security threats to computerized accounting information systems (CAIS) in the Egyptian banking industry (EBI) by surveying the entire population of the EBI. Differences between the respondents' opinions regarding the perceived security threats have been identified and investigated in the context of the EBI. The results of the study reveal that accidental entry of bad data by employees, accidental destruction of data by employees, introduction of computer viruses to the system, natural and human-made disasters, employees' sharing of passwords, and misdirecting prints and distributing information to unauthorized people are the most significant perceived security threats to CAIS in the EBI. In all cases, the heads of internal audit departments reported higher occurrence frequencies of CAIS security threats compared to the heads of computer departments.

Political Violence and Excess Liquidity in Egypt

In this article we estimate a time-series model of excess liquidity in the Egyptian banking sector. While financial liberalisation and financial stability are found to have reduced excess liquidity, these effects have been offset by an increase in the number of violent political incidents arising from conflict between radical Islamic groups and the Egyptian state. The link between political events and financial outcomes provides a rationale for economic policy interventions by the international community in response to increases in political instability.

Origins and Early Development of Banking in Ethiopia

This paper highlights development of Ethiopian banking from the beginning of XX century to 1936. In fact, the history of banking in Ethiopia dates back to the turn of the century, when, in 1905, the Bank of Abyssinia was established in Addis Ababa, under the reign of Menelek II. This event marked the introduction of banking in the country. National Bank of Egypt having been entrusted of the project, the new institution was chartered in Cairo and its shares were subscribed in a number of countries besides Ethiopia The Bank of Abyssinia was given a 50-years concession and was engaged in issuing notes, collecting deposits and granting loans, but its clients were mostly foreign businessmen and wealthy Ethiopians. A few years later, disappointed by the behaviour of this bank, mainly devoted to profit-making rather than promoting economic development, the Emperor supported the establishment of a wholly Ethiopian bank, the Societe Nationale d'Ethiopie pour le Developpement de l'Agriculture et du Commerce. Haile Sellassie, after acceding to the throne in 1930, could not accept that the country's issuing bank was foreign-owned and, in agreement with National Bank of Egypt, decided liquidation of the Bank of Abyssinia. A new bank, the Bank of Ethiopia, under Government control, was established in 1931 and retained management, staff, premises and clients of the old bank. Italian occupation in 1936 brought the liquidation of the Bank.

Investigating The Security Policies Of Computerized Accounting Information Systems In The Banking Industry Of An Emerging Economy: The Case Of Egypt

Information has become one of the most valuable corporate assets, which should be protected with care and concern because business survival and success are heavily dependent upon the confidentiality, integrity and continued availability of critical information. The reliance on information and rapidly changing technology forces many organizations to implement comprehensive information security programs to protect their information systems. However, the success of implementing such security programs relies largely on employees’ awareness and compliance. The failure to secure information or to make it available when required to those who need it would lead to financial and non-financial losses. The objective of this paper is to explore the main characteristics of security policies of the computerised accounting information systems (CAIS) in the Egyptian Banking Industry (EBI), and to investigate the differences among bank types regarding the existence, implementation, clarity, comprehensiveness, publicity, awareness, management attitudes, and participation in designing, developing and evaluating their banks’ CAIS security policies. The research statistics revealed that the vast majority the surveyed banks has formal written, clear, comprehensive, reasonable and well-published CAIS security policies. Moreover, the majority of respondents believed that there was adequate awareness of CAIS security issues among their banks’ managers and employees and that managers had positive attitudes and paid great attention to security issues. Further, the majority of respondents also claimed that they participated in designing, developing and evaluating their banking CAIS security policies and controls.

Investigating the security controls of CAIS in an emerging economy

Computerized accounting information systems (CAIS) are becoming more readily available to all types and sizes of business. The increased growth in real‐time and online data processing in CAIS has made access to these systems more available and easier for many users. Therefore, implementing adequate security controls over organisations, CAIS and their related facilities has become a necessity. The main objective of this article is to investigate the adequacy security controls implemented in the Egyptian banking industry (EBI) to preserve the confidentiality, integrity and availability of the banks' data and their CAIS through a proposed security controls check‐list. The security controls check‐list of CAIS was developed based on the available literature and the empirical results of previous studies. It includes many security counter‐measures that are empirically tested here for the first time. The entire population of the EBI has been surveyed in this research. The significant differences between the two respondent groups had been investigated. The statistical results revealed that the vast majority of Egyptian banks had adequate CAIS security controls in place. The results also revealed that the heads of computer departments (HoCD) paid relatively more attention to technical problems of CAIS security controls. This study has provided invaluable empirical results regarding inadequacies of implemented CAIS security controls in the EBI. Accordingly some recommendations were suggested to strengthen the security controls in the Egyptian banking sector.

THE IMPACT OF THE TYPE OF STRATEGY ON ENVIRONMENTAL SCANNING ACTIVITIES IN THE BANKING INDUSTRY: AN INTERNATIONAL PERSPECTIVE

This study investigated the impact of the type of strategy on the type of environmental scanning activity of Egyptian CEOs at Egyptian banks. Results indicated that CEOs with a cost‐leadership strategy were involved in environmental scanning activities that provide information concerning threats. Their counterparts with a differentiation strategy were involved in environmental scanning activities that provide information concerning opportunities.

The Relationship Between User Satisfaction and Systems Usage

Evidence on information systems effectiveness measures in environments that differ from those of the U.S. are critical to managing global information systems. The purpose of this investigation was to explore the relationship of user satisfaction to system usage, as measures of information systems effectiveness, in a sample of Egyptian banks. A relatively high user satisfaction was found to be accompanied only by a relatively average usage level. While the positive relationship between user satisfaction and system usage may suggest the use of the two surrogate measures alternatively to measure systems effectiveness, researchers have to be cautious and should adopt measures that fit the human, technological, and organizational characteristics of the systems being measured. This is particularly critical when researchers in developing countries have to adopt measures, that have been originally developed and tested in Western countries to measure systems effectiveness in diverse environments.Request access from your librarian to read this article's full text.

The Relationship of Some Personal and Situational Factors to IS Effectiveness

Most, if not all, of the empirical evidence on information systems effectiveness and its associated factors is confined to the use of data from developed countries, in particular from the USA. The findings of such research cannot necessarily be generalized to other environments where the social, economic, and cultural characteristics are different. Such evidence needs to be first validated using cross-cultural research before it can be used to manage global information systems effectively. This paper reports on the results of research aimed at testing the relationship of user’s age, tenure in the job, organizational level, education, training, duration of system use, and involvement in system development to information systems effectiveness, as measured by user satisfaction and systems usage. Data were collected from 120 managers in 22 Egyptian banks. Age, tenure in the job, and user involvement in systems development were found to be positively correlated with user satisfaction. However, age, organizational level and education were found to be negatively associated with system usage. While beneficial to the Egyptian IS managers, such evidence from developing countries should contribute to the building of a general theory of trans-national global information systems.

Informal finance in Egypt: “Banks” within banks

Policy makers often assume that individuals using informal finance are forced to do so because they lack access to formal financial services. Research in a large agricultural bank in Egypt, however, showed that many of its employees participated in informal finance. Interviews with villagers in a community with a branch of the bank also showed extensive involvement in informal finance. The popularity of informal finance among people with easy access to banks suggests that formal finance in Egypt may not be providing the types of financial services that people demand and they therefore, create these services informally.

AN EMPIRICAL COMPARATIVE STUDY BETWEEN ISLAMIC AND COMMERCIAL BANKS' SELECTION CRITERIA IN EGYPT

The purpose of this paper is to determine the number of selection criteria of Islamic and commercial banks in Egypt and to identify the relative influence that each attribute may exert on the selection process. Findings indicate differences in the important selection criteria of Islamic and commercial banks in Egypt. Although the number of attributes was similar, differences prevailed in the relative importance of selection criteria. This finding could be linked to the fundamental difference between these two banking systems that are widely spread in the Middle East.

The Landlordism and Mortgage Banks in Egypt, 1880-1914

The Landlordism and Mortgage Banks in Egypt, 1880-1914

Islamic Banking and Credit Policies in the Sadat Era: The Social Origins of Islamic Banking in Egypt

Islamic Banking and Credit Policies in the Sadat Era: The Social Origins of Islamic Banking in Egypt

Islamic Banking and Credit Policies in the Sadat Era: the Social Origins of Islamic Banking in Egypt

In 1971 President Sadat charted a new course for the Egyptian economy, away from the socialism of the Nasser era and towards greater encouragement for the development of the private sector and investment by private individuals and companies, whether Egyptian or foreign. Starting gradually, the process of liberalisation gained momentum in the mid-70s. The most important landmark of the new policy came in 1974, when Law 43 of that year was enacted to give major incentives to both foreign and Egyptian private capital to invest in Egypt. One of the most striking consequences of the Inhtah, or open-door policy, was the sudden proliferation of banks, beginning in 1974. lEreviously, there had been in the Egyptian bag system only the four nationalised banks the Bank Misr, the Bank of Alexandria, the Bank of Cairo, and the National Bank of Egypt-and a small number of specialised banks dealing with mortgages, co-operative credit, social security, and the like. In addition to these and operating administratively as foreign banks outside the nationalised banlig system were the Arab African Bank and the Arab Internanonal Bank for Trade and Development. In a special category there was the new Nasser Social Bank, founded in 1971. Of course there was also the Central Bank of Egyptj which like central banks elsewhere, was the banker's bank, controller of the volume of credit, custodian of the buLk of government funds, and the government's agency and adviser in financial matters. After 1974 these organisations were quickly joined by dozens of new banks, which included several private banks as well as banks that were joint ventures between the naiionalised Egypiian banks and foreign partners. In 1980, various new banks were being set up, and it was apparent that the Sadat goverrunent viewed the continued expansion and development of banking as an important component of Egypt's econoniic transformaiion.