Financial Performance Of Banks Research Articles

Influence of Banking Innovations on Financial Performance of Kenya Commercial Bank

Given the importance of financial innovation in describing banking performance, the impact of innovation on performance remains unclear for two reasons: first, there is a lack of understanding of the sources of innovation; and second, the impact of innovation on bank performance has yet to be tested. The researcher aim was to ascertain what exactly affects the financial performance of Kenya Commercial Bank (KCB) in Nairobi County in Kenya. There are numerous elements that affect performance, this study will focus on banking innovations that are thought to drive financial performance. The study was divided into three main common areas that have recently caught the attention of the banking industry namely internet banking agency banking and mobile banking that affect the financial performance of KCB bank Nairobi County. Nairobi County has been chosen since it is the capital City and an epicenter of numerous commercial activities. The study’s specific objectives were to determine the influence of agency banking, mobile banking, Automated Teller Machines and debit and credit cards on financial performance of commercial banks in Kenya. This study was guided by Agency theory and Schumpeter theory of innovation. The study employed a descriptive research design. The study had a target population of 294 respondents. The sample size was 169 staff of KCB bank spread across the branches in Nairobi County. Respondents were selected using purposive random sampling. Structured questionnaires was used to collect primary data from respondents while secondary data was obtained from KCB, Central Bank of Kenya (CBK), Nairobi Stock Exchange (NSE) and annual financial reports from the KCB bank. Measures of central tendencies was used to describe the results and data presented using graphs charts and tables.The effect and influence of in dependent and independent variable was depicted by use of multiple regression. From the findings, agency banking was found to be the most significant factor influencing financial performance with a p-value of 0.00. It can be concluded from the findings that agency banking has a positively relationship with commissions fee based income and positively relates to interest fee based income. Internet banking positively relates to commissions fee based income and positive relate to interest based income. Internet service has contributed to expansion of the income generating potential of commercial banks. Automated Teller Machine (ATM) system compensates for wrongful deductions and the ATM problems are settled to clients’ satisfaction. Debit & credit cards have had a positive effect of increasing commission fee based income and have influenced positively the increase of interest based income. Further study ought to be conducted on effectiveness of banking innovations on financial performance of other commercial banks since this was a case of KCB bank. This may provide more understanding on how the different banking innovations affect financial performance of the banks. The study recommends that agency banking should be enhanced by increasing the number of agency banking points across the country. The management of the bank should also enhance mobile banking by developing customer friendly mobile applications to enhance transactions by the clients. Therefore the bank management should make sure they increase the ATMs and enhance their innovation that touches on transactions through ATMs. The bank should also enhance the debit and credit cards by liasing with the cutomers to get their suggestions on how to improve the debit and credit cards.

Effect of Customer Involvement Strategy on Financial Performance of Commercial Banks in Nakurucity, Kenya

Organization performance relies on the strategic innovation practices employed by a firm. Organizations are opting for strategic innovation as a response to increasing business environment turbulence and complexity, among them, customer involvement strategy. This study sought to assess the effect of customer involvement strategy on financial performance of Commercial Banks in Nakuru City, Kenya. The research adopted a descriptive research design, targeting 320 staff working at commercial banks in NakuruCity, with a sample size of 178 respondents. The findings established that customer involvement strategies plays a vital role in influencing the banks financial performance positively. The researcher recommends that banks should focus on assimilating customer’s retention strategies which is important in telling the frequent customers, and hence being in better position to understand their needs since they are able to interact with them. Consequently, through this, the customer’s opinions are taken in to account by the banks decision makers, which facilitates improvement in service delivery, translating to improved financial performance.

DAMPAK TATA KELOLA PERUSAHAAN TERHADAP KINERJA LEMBAGA PERBANKAN DI INDONESIA

Corporate governance is an important aspect in the company. The impact and implementation of corporate governance has become interesting for various companies because it substantially controls the management of institutions. This study analyzes the impact of elements of corporate governance (CG) which includes the composition of the board on the performance of banking institutions listed on the Indonesia Stock Exchange (IDX). The research population involved 25 banking institutions which are commercial banks in Indonesia. The data taken has a span of 4 years (2017, 2018, 2019, and 2020). Spearman correlation is used to identify the relationship between corporate governance and banking financial performance. The results of this study indicate that there is a positive relationship or correlation between the number of board personnel and the financial performance of commercial banks. The number of independent directors has a positive significant relationship with ROA, ROE and EPS, job duality has a positive significant relationship with ROA and EPS, and board meetings have no significant relationship with financial performance.

Effect of Fraud Risk Management Skills on Value-Based Financial Performance of Banks in Ghana

Effect of Fraud Risk Management Skills on Value-Based Financial Performance of Banks in Ghana

Intellectual capital and financial performance, measured by camels perspective

This study empirically examines the impact of intellectual capital on banks financial performance in 57 public listed banks from Indonesia, Malaysia, and Thailand over the period of 2019 to 2020. Intellectual capital is measured by Pulic’s Value Added Intellectual Coefficient (VAICTM), while banking performance is measured according to CAMELS analysis method. Through the method of partial least squares analysis to find the path coefficients value of each variable, the results obtained show that there is a significant positive impact of VAICTM on management quality (NPM) and earnings (ROA) in Indonesian, Malaysian, and Thai Banks, and significant negative impact of VAICTM on asset management (NPL) of Indonesian, Malaysian, and Thai Banks. On the other side, VAICTM is considered to have an insignificant impact on the capital adequacy (CAR), liquidity (LDR), and sensitivity to market risk (IER) of the in Indonesian, Malaysian, and Thai Banks in 2019-2020.

The Effect of A Holistic Merger and Acquisition Capability Framework on Value-Based Financial Performance of Banks in Ghana

The Effect of A Holistic Merger and Acquisition Capability Framework on Value-Based Financial Performance of Banks in Ghana

Digital Financial Services on Financial Performance of Commercial Banks in Nigeria

Since the introduction of information communication technology and the widespread use of the internet, the banking business has undergone considerable changes. Information and communication technology (ICT) is at the heart of Nigeria's current worldwide shift curve in the electronic banking system. In light of this, this study looked into the influence of digital financial services (DFS) on the financial performance of Nigeria's publicly traded commercial banks. The study aims to see if there is a link between the dependent variable, which is financial performance as assessed by banks' earnings-per-share (EPS), and the main independent variables, which are the volume of ATM and POS transactions as a proxy for digital financial services (DFS). Secondary data was employed in the study. The data was collected from the annual report of target banks and the Central Bank of Nigeria from 2012 to 2020. The study used both descriptive and inferential statistics in analysing the data. In general, the study revealed that digital financial services (DFS) have substantial and significant marginal effects on earnings per share in Nigeria’s banking sector. Thus, there exists a positive relationship between digital financial services (DFS) and bank financial performance. In conclusion, electronic banking has made banking transactions to be more accessible by bringing services closer to its customers hence improving banking industry performance. Thus, the study recommends that bank management should enhance digital banking to improve financial performance in commercial banks.

LIQUIDITY MANAGEMENT AND FINANCIAL PERFORMANCE OF LISTED DEPOSIT MONEY BANKS IN NIGERIA

The study investigates the effect of liquidity management on financial performance of listed deposit money banks in Nigeria. Liquidity management was measured and proxy with capital adequacy ratio, liquidity ratio and loan to deposit ratio, however financial performance was proxy with Tobin’s Q. Secondary data source was utilized and it was extracted via the audited published annual reports and accounts of the banks selected covering the period from 2010-2019. Panel multiple regression technique was adopted as the technique of data analysis, while Stata 13 was used as the tool for analysis of data. Robustness tests which include heteroscedasticity, multicollinearity and normality test of standard error were conducted. Findings revealed that capital adequacy ratio have positive and significant effect on financial performance of listed deposit money banks in Nigeria. Liquidity ratio has significant but negative effect on financial performance of banks in Nigeria which connotes that high level of liquidity ratio will lead to low level of performance strategically for banks. Loan to deposit ratio has positive but insignificant effect on financial performance. It is therefore recommended that management of board should pursue increased capital with the Central Bank of Nigeria and the CBN should also make sure that banks met and continually meet the requirements in respect of capital adequacy before giving the license to operate. The management of the banks should ensure that most idle cash are investment into short term portfolios to attract higher returns which will eventually increase the value of the banks.

Crisis And Bank Performance In The Covid-19 Era: Russia Case Study

This study aims to investigate Russia's financial performance during the COVID 19 outbreak and the financial crisis. We use indicators of bank financial performance as the dependent variable in this study. An indication of bank success is bank profit after taxes. As independent variables, general reserves and finance were utilized. For this investigation, the Russian financial services regulator used a sample of all bank transactions across the country that were recorded (Central Bank of the Russian Federation). This study covers a population of all financial institutions in Russia, including those that are registered and those that are not, throughout a monthly time span from January 1995 to January 2021. We found that financing generally has a very favorable impact on Russian banking performance. However, general reserves have a detrimental impact on Russian bank performance. This makes perfect sense since in a stable economy, financing is the spearhead of bank income with measurable risks so when financing increases, bank income also increases. On the other hand, if the reserves increase, more money will settle and in the end, it will have an impact on the loss of opportunities to earn income. However, during a crisis, financing becomes very risky so it is negatively related to bank performance during a crisis, but it is reserved that are the driving force for bank income from deposits to the central bank.

Pengaruh tingkat suku bunga, inflasi, dan non performing loan terhadap pemberian kredit dan dampaknya terhadap kinerja keuangan

This study aims to analyze the effect of interest rates, inflation, and non-performing loans on lending and their impact on the financial performance of banking companies listed on the IDX. The population of this study were all banks listed on the Indonesia Stock Exchange for the period 2013-2015, totaling 43 banks. Sample selection through purposive sampling method. There are 21 companies that meet the criteria as the research sample so that the research data is 63. The data analysis technique used is the classical assumption test and hypothesis testing. The results of this study indicate that the interest rate has a significant and negative effect on lending. Inflation partially has a negative and significant effect on lending. Non-Performing Loan partially has a negative and significant effect on lending. The partial distribution of credit has a positive and significant effect on financial performance. The interest rate has a positive and significant effect on the company's performance as proxied by ROA. Inflation partially has a positive and significant effect on financial performance. Non-Performing Loans have a negative and significant effect on the financial performance of banks

Mediating effect of risk management practices in Iraqi private banks financial performance

Mediating effect of risk management practices in Iraqi private banks financial performance

The Effect of Managerial Competence on Value-Based Financial Performance of Banks: The Mediating Role of Sustainable Competitve Advantage

The Effect of Managerial Competence on Value-Based Financial Performance of Banks: The Mediating Role of Sustainable Competitve Advantage

Toward a better understanding of social impact, CSR reporting and firm performance: a look at the ASEAN banking industry

PurposeThis study aims to investigate the relationship between social impact, corporate social responsibility (CSR) reporting and firm performance in the context of the Association of Southeast Asian Nations (ASEAN) banking industry, providing insight into CSR-performance nexus debate, especially for non-environmentally sensitive industry (NESI).Design/methodology/approachWe use a sample of 27 publicly listed banks in five ASEAN member countries (i.e. Indonesia, Malaysia, Singapore, Philippines and Thailand), with the period of observations ranged from 2011 to 2019 year. This study also carefully accounts for endogeneity issues and the dynamics of social impact – CSR reporting – bank financial performance relationship.FindingsThe results show that social impact (performance) and CSR reporting negatively associate with bank performance, either measured by accounting performance or market performance. The negative association between social performance and bank financial performance also persists in a longer-term relationship. This result implies that social performance and CSR might not have the expected result for banks in ASEAN developing countries and the expected effect also does not manifest in the following periods.Practical implicationsThe negative association between social performance and financial performance implies that banks’ CSR in ASEAN might be misstargeted or that it takes more time to manifest the expected outcome. Therefore, banks should be able to foresee if social investment will finally offset the opportunity cost from diverting financial resources away from their core activities. On the other hand, policymakers must standardize the reporting related to social activities for banks and should bring the environmental and social issues to the depositors’ attention to show that these issues are also relevant in the banking industry.Originality/valueTo the best of the authors’ knowledge, this study is among the first to provide empirical evidence on the direct relationship between social impact, CSR reporting and firm performance in the context of ASEAN’s NESI. The results should be of potential interest value to ASEAN’s banks, regulators and shareholders.

Islamic Financial Bank Performance in Indonesia and Malaysia

The increasing popularity of Islamic banks with the opening of various Islamic banks, both independent and as one of the long-established subsidiaries of conventional banks, seems to show that the banking industry, which applies Sharia principles in every business step, promises profitable business expansion opportunities. The purpose of this study is to compare the financial performance of Islamic commercial banks that were established in Indonesia and Malaysia in the 2016 – 2018 period using general financial ratios, namely the ratio of CAR, ROA, FDR and Total Asset Turnover. The research sample was taken by purposive sampling. The data obtained were analyzed by descriptive statistical methods to see the overall performance of banks both within and between countries, then the independent sample t test was used to see the significance of the differences in the performance of each type of banking industry in each country, both in Indonesia and Malaysia. This study shows that the financial performance of Islamic commercial banks in Indonesia and Malaysia has significant differences.

Financial Technology (FinTech) and Its Impact on Financial Performance of Islamic Banking

As a financial services provider, Islamic banking must be able to keep up with the times by responding to challenges and establishing a competitive advantage through the development of innovative financial products and services using Fintech. The goal of this research is to examine how FinTech services affect Islamic banking's financial performance. With a case study at Bank Syariah Indonesia (BSI), this study used a quantitative-descriptive research design. Financial ratios such as CAR, ROA, ROE, BOPO, FDR, and Finctech service were used as secondary data. The data is in annual time series format ranging from 2016 to 2020. In this study, the program SPSS 21 was used to process the data to perform the Classical Assumption Test, Simple Linear Regression, t-Test, and Coefficient of Determination Test. Finding of current research proves that Fintech service has an impact on the financial performance of BSI in terms of CAR, ROA, ROE, BOPO, and FDR

Impact of Earnings Management on Profitability of Commercial Banks: Evidence from India

This article assesses the impact of earnings management on bank’s current and future financial performance. A bank-specific model, invented by Beatty et al. (2002, Accounting Review, vol. 77, pp. 547–570) and modified by Mangala and Singla (2021; Vision: The Journal of Business Perspective, vol. 25, pp. 159–167), is applied to measure earnings management. Cross-sectional regression is applied to analyse the impact of earnings management on the financial performance of banks for a time period of 7 years (from 2012–2013 to 2018–2019.). The results exhibit that Indian banks actively manage earnings. Earnings management reduces current year’s return on equity, return on assets and net interest margin. Current year’s earnings management also negatively influences following 2 years’ return on equity and net interest margin. Thus, earnings management has major negative implications on banks’ financial performance, not only in the year of earnings management but also in the years to come. In order to curtail earnings management, while examining the financial statements, auditors should be vigilant, and the Reserve Bank of India (the apex regulator) should take punitive actions against such malpractices.

Analysis Of Bank Performance Before And After Covid 19 In Banking Companies Listed On Idx

This study aims to analyze the banking performance before and after covid 19 in banking companies listed on the IDX. In this study, the banking performance indicators analyzed are the CAR (Capital Adequacy Ratio), BOPO (Operating Expenses to Operating Income), NIM (Net Interest Margin), LDR (Loan to Deposit Ratio), and ROA (Return On Assets). The sample used is banking companies listed on the Indonesia Stock Exchange (IDX) in 2019 and 2020 with the total of 43 banks. This study an event to examine the differences or changes in banking financial performance, before covid 19 and after covid 19. The data analysis technique used is the average difference test using SPSS program. Based on the test results, it was found that the COVID-19 pandemic caused the BOPO, NIM, LDR and ROA ratios to decrease or worsen, while the CAR ratio increased.

E-PAYMENT INNOVATION IN IMPROVING BANK INDONESIA'S FINANCIAL PERFORMANCE

Business competition in the financial services industry keeps the banks constantly innovating in services and products. One of the innovations made by the banking industry is e-payment.This study aims to determine the effect of e-payment on financial performance with moderated bank size. The population in this study is banking companies listed on the Indonesian Stock Exchange (IDX) in 2014-2016 as many as 43 banks. Sample selection method used is purposive sampling, so that obtained the number of samples of 10 banks. The data obtained were analyzed using Moderated Regression Analysis (MRA). The results of this study indicate that e-payment has a significant positive effect on financial performance and bank size strengthen the relationship between e-payment to financial performance. The results indicate that innovation in adopting e-payment can improve bank financial performance. The banks need to pay attention to innovation in financial services as a competitive strategy to improve financial performance.

The Effect of Bank Indonesia 7-Day Reverse Repo Rate on Profitability and Banking Capital in Indonesia

Changes in the reference interest rate of Bank Indonesia from the BI Rate to the BI 7-Day Reverse Repo Rate cause differences in the tenor of depositing funds in Bank Indonesia Certificates, percentages, and interest income earned, which will cause differences in bank financial performance, particularly in bank profitability and capital. Bank profitability is measured using ROA, ROE, NIM, and bank capital is measured using CAR. The purpose of this study is to analyze the differences in banking profitability and capital before and after the BI 7-Day Reverse Repo Rate so as to determine the effect of the BI 7-Day Reverse Repo Rate on banking profitability and capital in Indonesia. The sample in this study is 4 bank through purposive sampling at state-owned commercial banks that were registered on the Indonesia Stock Exchange and had published quarterly financial reports at the Financial Services Authority in the period 2012-2020. This study uses non-participant observation methods and the Wilcoxon Signed Rank Test. The results show that there are significant differences in banking profitability and capital in Indonesia before and after the BI 7-Day Reverse Repo Rate, thereby proving that the BI 7-Day Reverse Repo Rate has a significant effect on banking profitability and capital in Indonesia.

The impact of intellectual capital on commercial banks' performance: evidence from Bangladesh

PurposeIntellectual capital (IC) and financial performance is now a very contemporary issue in the banking sector. The purpose of this study is to investigate empirically the impact of IC on financial performance of all the listed commercial banks of Bangladesh.Design/methodology/approachBangladesh Bank database and financial statement of the listed commercial banks of Bangladesh for the period of 2014–2018 have been used to collect data. Value added intellectual coefficient (VAICTM) methods have been used for measuring the performance of banks. VAICTMdetermined IC and its three major components like structural, human and capital employed.FindingsThe results suggest that human capital efficiency (HCE) and capital employed efficiency (CEE) have statistically significant relationships with bank performance, but when VAICTMis divided then structural capital efficiency (SCE) does not have a significant relationship with bank performance.Research limitations/implicationsThe study uses only listed banks, but it does not include all the commercial banks specially nationalized commercial banks.Practical implicationsThe findings allowed banks to focus more on human capital (HC) and structural capital, because in the present world, HC is considered one of the key factors for the success in business. This study also provides an awareness on how good IC of the banking companies will bring more assistance to a better life of a society.Originality/valueThis is one of the very few studies which examine the impact of IC on bank financial performance in Bangladesh.