Foreign Exchange Transactions Research Articles

Review of Accounting and Auditing Practices of Foreign Exchange Transactions in Russian Organizations (In Russ.)

Review of Accounting and Auditing Practices of Foreign Exchange Transactions in Russian Organizations (In Russ.)

De-dollarization? Not so fast

De-dollarization refers to the reduction of the reliance of foreign countries on the US dollar. This phenomenon generates concern about the U.S. dollar as a global currency. We construct new data on the currency denomination of central bank currency reserves, foreign exchange transaction volume, denomination of global debt securities, and the invoicing of trade. This paper presents empirical evidence suggesting that these concerns are misplaced, finding US dollar dominance remains unchanged up through late 2023, nearly two years after the 2022 Russian invasion of Ukraine and several years after the 2020 COVID-19 pandemic. Meanwhile euro and renminbi influence have since declined. These findings have implications for reserve currency resilience, U.S. dollar dominance, U.S. sanctions policy, international spillovers of U.S. monetary policy, and U.S. government borrowing costs.

Foreign Exchange Operations of Islami Bank Bangladesh Limited

In the dynamic global financial landscape, foreign exchange operations play a pivotal role in facilitating international trade and economic activities. Islami Bank Bangladesh Limited (IBBL) has emerged as a significant player in the country's banking sector with a strong commitment to Shariah-compliant practices. Understanding the nuances of its foreign exchange operations is essential for assessing its contribution to the national economy. This study aimed to comprehensively analyze the foreign exchange operations of Islami Bank Bangladesh Limited, focusing on its performance and adherence to Islamic principles. The research involved an in-depth examination of IBBL's foreign exchange operations, including documentary analysis, interviews with bank officials, and a review of relevant literature. Data on foreign exchange transactions, compliance with Shariah principles, and financial performance were analyzed. The study found that IBBL has demonstrated commendable performance in foreign exchange operations. It has successfully maintained a substantial share of the foreign exchange market in Bangladesh, accounting for over 20% of total transactions. Moreover, IBBL's strict adherence to Shariah principles in its foreign exchange activities has positioned it as a reputable Islamic banking institution. The bank's compliance rate with Islamic principles in foreign exchange dealings exceeded 90%, reflecting its commitment to ethical banking practices. Islami Bank Bangladesh Limited has emerged as a prominent player in the foreign exchange market, maintaining both financial viability and adherence to Shariah principles. Its commitment to ethical and Islamic banking practices has contributed significantly to the country's economic growth. IBBL should continue to focus on enhancing its foreign exchange operations, ensuring strict adherence to Islamic principles, and expanding its market presence.

Sectoral Utilization of Foreign Exchange and the Policy Implications for Economic Growth in Nigeria (1997 – 2022)

Purpose: The purpose of this study is to investigate the effect of sectoral utilization of foreign exchange and the policy implications for economic growth in Nigeria.
 Methodology: The methodology involved the use of annual time series data covering 1997 to 2022 for pre-diagnostic tests for unit roots which showed that the variables used in the study: economic growth (proxied by real gross domestic product), visible transactions, invisible transactions, treasury bill rate, and exchange rate, were stationary in the first difference. Hence, after first differencing the data, the Ordinary Least Squares (OLS) estimation method was used to estimate the model.
 Findings: The findings of the study showed that visible and invisible foreign exchange utilization valid for foreign exchange transactions, in addition to exchange rate and Treasury bill rate impacted positively and significantly on economic growth in Nigeria during the study period. The results of the study strengthened the theoretical basis for the use of relevant policies to grow economies generally, and that of Nigeria in particular.
 Unique contributor to theory, policy and practice: By implication, the governments at all tiers should endeavor to provide the enabling environment for greater availability and utilization of foreign exchange to further improve economic growth and sustainable development in Nigeria.

DETERMINAN FAKTOR PENGUKURAN KINERJA BANK KONVENSIONAL TAHUN 2015 – 2019

This study has purposed to determine the effect of CAR, BOPO, NPL, NIM and LDR on ROA in the Public Banking Industry on the Indonesia Stock Exchange for the 2015-2019 period. The hypothesis test of this study using Multiple Linear Regression Analysis. The sampling method used purposive sampling method, using certain criteria. The sample population are 30 banks that have foreign exchange transactions from 44 conventional banks listed on the Indonesia Stock Exchange. The results show that CAR has a positive and significant effect on ROA, BOPO has a negative and significant effect on ROA, NPL has a negative and significant effect on ROA, NIM has a negative and significant effect on ROA, LDR has a negative and significant effect on ROA.
 
 Keyword: CAR, BOPO, NPL, NIM, and ROA

Impact of RMB Exchange Rate Fluctuations on the Performance of Cross-Border Mergers and Acquisitions of High-Tech Enterprises: A Moderated Mediation Model Based on Innovation Input

Cross-border mergers and acquisitions (M&A) serve as a crucial pathway for the international development of high-tech enterprises. However, currency exchange and foreign exchange transactions are frequent occurrences during cross-border M&A processes, making exchange rate fluctuations significantly influential on the success rate and performance of such endeavors. By analyzing the impact of exchange rate volatility on high-tech enterprises, this study introduces innovation input as a moderating mediating variable. The findings reveal that greater exchange rate fluctuations lead to poorer M&A performance. Moreover, innovation input acts as a mediating variable in the relationship between exchange rate volatility and M&A performance. The study contributes to strategic insights for the international M&A activities of enterprises.

Role of Bank of Agriculture in Fostering Agricultural Development in Nigeria

This research work examines the role Bank of Agriculture Limited plays in fostering agricultural development in Nigeria. Primary data was obtained by distributing 120 questionnaires to farmers who benefitted from the Bank’s credit facility, linear regression analysis was employed and the result reveals that credit advance contributes 24.13% in increasing farmers’ output which translates to agricultural development. It was therefore recommended that the government should firstly invest in the agricultural sector by making provisional allocations in the annual budget for the Bank; secondly, the Bank should streamline the loan application, processing and approval procedure to ease access to credit; thirdly, enact policy that will mandate civil servants to have personal account with the Bank to help raise the liquidity position of the Bank; and lastly, direct the Central Bank to issue all financial transaction licenses to the Bank including such that would enable the Bank deal in foreign exchange transactions.

Analisis Perlakuan Selisih Kurs Mata Uang Asing Pada PT Elang Mahkota Teknologi Tbk

The aim of this research is to analyze the treatment of foreign exchange differences at PT. Elang Mahkota Teknologi Tbk (EMTK), focusing on transaction management, the use of functional currency, and exchange rate risk mitigation. The research method employed is qualitative, with PT EMTK as the research subject. Data was obtained through literature review, referring to the Annual Reports of PT EMTK. The study indicates that PT EMTK adopts a cautious approach in handling foreign exchange transactions. The majority of business units use the Indonesian Rupiah as the functional currency, and the monetary assets and liabilities are adjusted to the exchange rates at the reporting date. Despite the absence of an official hedging policy, the company still considers current market conditions, especially regarding cash and cash equivalents balances in USD. Additionally, the research reveals that PT EMTK conducts sensitivity analysis on exchange rate risk, measuring the impact of exchange rate fluctuations on pre-tax profits. Overall, the company diligently monitors foreign exchange rate risks and takes proactive measures against external factors that may affect financial performance.

Analisis Risiko Nilai Tukar Mata Uang Asing Dengan Menggunakan Metode Value at Risk (VAR) Pada Bank Muamalat Indonesia

This study aims to measure the maximum potential loss or VaR value for each type of Foreign Exchange based on the calculation results for 1 day, 5 days, and 20 days at Bank Muamalat Indonesia and determine the implementation of risk management applied by Bank Muamalat Indonesia to deal with foreign exchange risk. The research method in measuring Value at Risk of foreign exchange rates uses quantitative methods. The type of data that the author uses in this study is secondary time series data on foreign exchange rates of USD, JPY, EUR, and SAR at Bank Muamalat Indonesia. during the time period 2 January 2018 to 31 December 2018. Data analysis techniques in the study were carried out in several stages, namely calculating exchange rate returns, volatility and daily value at risk. The results showed that the maximum exchange rate risk borne in 1 day, 5 days and 20 days with a 95% confidence level. The implementation of underlying in foreign exchange transactions at Bank Muamalat Indonesia refers to the National Sharia Council regulation No.96 / DSN-MUI / IV / 2015 concerning Sharia Hedging Transactions (Al-Tahawwuth Al-Islami / Islamic Hedging) on Exchange Rates. Bank Muamalat has conducted hedging cooperation with PT Kharisma Pemasaran Bersama Nusantara (KPBN) or Indonesia Commodity (Inacom) on 05 December 2019 as a form of Foreign Exchange Rate risk management.

Exploring New Trends in the Global Foreign Exchange Derivatives Market Based on the European and American Financial Markets

This research delves into the changes in products and participants in the foreign exchange derivatives market in Europe and America. It uncovers the new trends in the global foreign exchange derivatives market. The European and American financial markets are significant players in foreign exchange trading and financial innovation, as they affect the world through their market fluctuations and policy changes. The study reveals that the foreign exchange derivatives market is undergoing new dynamics and environmental changes. Innovative products are emerging, and the level of transaction automation is increasing. The foreign exchange derivatives market in Europe and the United States has transformed from a simple spot foreign exchange transaction to a diverse trading system that covers major global currencies. The proportion structure of trading participants is also changing over time. In conclusion, this research provides profound insights into the global foreign exchange derivatives market. It aims to provide relevant suggestions and references for market participants and regulators based on its analysis.

Risk Assessment of the Banking Industry under the COVID-19 Crisis

This paper shows that increased bank asset liquidity does not necessarily reduce risk-taking. The help provided by the government in the epidemic crisis has also been provided after the damage occurred. On the other hand, the merger of banks is not a good thing for low-risk banks. Regulators should conduct frequent financial reports on banks to ensure that the risk of sudden default due to weak supervision is reduced. Foreign exchange risk management is especially important for banks involved in cross-border transactions and foreign exchange business. Reasonable control of the market exchange rate prohibits the impact of the foreign exchange black market on the market. The COVID-19 epidemic has led to fluctuations and instability in global exchange rates and the banking industry. For the foreign exchange transaction risks caused by exchange rate fluctuations, banks usually need various foreign exchange derivatives instruments to ensure that foreign exchange risks are effectively managed.

SERVICE SECTORS FOREIGN EXCHANGE TRANSACTION INCENTIVES AND ECONOMIC GROWTH IN NIGERIA

The service sector is a crucial component of economic growth, and it has been noticed as a sector with a greater capability that plays role in sustained economic growth and development in developing countries like Nigeria. Therefore, the study seeks to examine the impact of service sectors' foreign exchange transaction incentives on economic growth in Nigeria. The study employed the Time Series data and used ARDL and ECM in the estimation of variables. both long-run and short-run results revealed that the transportation sector foreign exchange transaction incentive has a positive and significant impact on economic growth in Nigeria. On the other hand, the education sector foreign exchange transaction incentive has a negative and insignificant impact on economic growth in Nigeria both in the long and short run. Therefore, the paper recommended that government should adopt both long and short-term policies of transportation sector foreign exchange transaction incentives for economic growth in Nigeria because of its positive and significant impact on economic growth in the short run and long run and the government should redesign policy in improving the education sector foreign exchange transaction incentive for economic growth in Nigeria because of its negative and insignificant impact on economic growth in the short run and long run.

Konsep Nilai Tukar Uang Perspektif Ekonomi Islam

This research discusses the transformation of the role of currencies in the context of the global economy and its impact on the Rupiah exchange rate. In the Islamic perspective, fiqh muamalah faces debates regarding currency trading, while Islamic economics emphasizes moral principles and social justice in resource ownership. The literature study outlines the concepts of exchange rates, foreign exchange transactions, and the basics of Islamic economics. The method in this research uses library research, which is a method of collecting data by understanding and studying theories from various literatures related to the research. In Islamic economics, currency exchange activities or exchange rates are called sharf activities. Where the sharf activity is permissible. Sharf is the sale and purchase or exchange between one foreign currency and another foreign currency, such as rupiah with dollars, dollars with yen and so on. The results of the study include the DSN fatwa regarding the interbank money market based on sharia principles, which emphasizes the prohibition of usury and uses contracts such as wadiah, qard, and alsharaf. This study contributes to further understanding of the Islamic view of currency trading in the context of the global economy.

Faktor yang Mempengaruhi Fee Based Income Pada Kelompok Bank Berdasarkan Modal Inti (KBMI) 4

This study aims to determine the effect of third-party funds, electronic banking and foreign exchange transactions on fee-based income at KBMI 4 banks. This type of research is quantitative research with a period of 4 years (Quarterly). Data comes from quarterly financial reports and banking company performance presentation reports with saturated sampling technique. Total samples is 4 bank with 56 observation data. Data analysis used panel data regression analysis with the fixed effect model selected and data testing tool using the Eviews version 12 application. The results obtained in this study were third-party funds, electronic banking and foreign exchange transactions affect fee-based income simultaneously. Third-party funds have no effect on fee-based income with a negative direction, electronic banking has an influence on fee-based income with a positive direction, foreign exchange transactions have an influence on fee-based income with a negative direction.

Methodological approach to assessing the development of the Russian currency market

The relevance of this study is related to the need to determine the main directions for the development of the Russian foreign exchange market and assess its state. Financial globalization integrates the national currency markets of countries into a single geo-economy, any economic crisis that arises in this system can acquire a worldwide scale, in this regard, and assessing the prospects for the development of the Russian currency market is a very urgent problem today. The insufficient development of the theoretical foundations for the development of the foreign exchange market makes it relevant to systematize the conceptual foundations for the development of the foreign exchange market and form a comprehensive methodological approach to its assessment. As a rule, economists study the state of the foreign exchange market through the dynamics of the exchange rate (real and nominal), while not taking into account other aspects of the functioning of the foreign exchange market (the volume of foreign exchange transactions, foreign exchange market participants, the number of foreign exchange accounts, the state of the country’s external debt, the size of gold and foreign exchange reserves, having correspondent accounts with foreign banks). The article discusses a methodological approach to assessing the development of the Russian foreign exchange market, which includes several stages. A methodology is proposed for assessing the development of the Russian foreign exchange market, which allows one to study indicators at two levels.

ВАЛЮТАЛЫҚ ҚАТЫНАСТАРДЫ РЕТТЕУ МЕН ЫРЫҚТАНДЫРУДЫҢ ХАЛЫҚАРАЛЫҚ ҚҰҚЫҚТЫҚ ТӘЖІРИБЕСІ

Abstract. The proposed article analyzes the features and current state of the legislative development of instruments of currency regulation and currency control in international practice. The author managed to conduct a comprehensive study of this topic and to a certain extent reveal it. It was considered whether the monetary policy has a significant impact on improving the economy and economic security of the state. Also in the scientific article, as an example, one's own subjective views are given, the author's position is justified. The relevance of the scientific article is emphasized by the fact that currently many countries are trying to lift restrictions on foreign exchange transactions and the movement of capital funds in order to create an economy attractive to foreign investors and resistant to external influences. Thus, the process of liberalization consists in lifting restrictions on the implementation of currency transactions between currency residents and non-residents in the international arena. In this regard, the author has legislatively analyzed and considered in detail the issue of the formation and development of the principles of capital movement liberalization at the international legal level. As a result of the study, it was found that since the adoption by individual states or integration associations of legislation in the field of currency regulation and currency control, currency restrictions began to weaken (in particular, the obligation to reserve currency and issue transaction passports during cross-border transactions was excluded). Currently, developed countries are systematically continuing the liberalization of currency legislation. At the same time, within the framework of liberalization, there is an increase in state attention to the property and income of foreign currency residents abroad in order to "educate" the economy. At the same time, the idea was formulated that the interests of society and the state from the point of view of national security and welfare should be taken into account when liberalizing. On the example of integration associations, the advanced foreign practice of currency and financial regulation is revealed. In addition, the features of the regulatory legal acts of the Republic of Kazakhstan in this area were considered, the author expressed his opinion on the need for further improvement of legislation to create a financial system resistant to external influences and international pressure. Keywords: monetary and financial relations, liberalization, currency regulation, international documents, obligations, principle, capital movement, regulation of relations.

2nd Annual International Roles of the U.S. Dollar Conference

The U.S. dollar plays a central role in the global economy. In addition to being the most widely used currency in foreign exchange transactions, it represents the largest share in official reserves, international debt securities and loans, cross-border payments, and trade invoicing.

Relevansi Fatwa DSN-MUI Nomor 28/DSN-MUI/III/2002 tentang Jual Beli Mata Uang (Al-Sharf) di Era Digital

The digital era affects various national-international economic transactions. Massive technological developments have had a significant impact on the economy, especially buying and selling transactions. In 2002, foreight exchanger transactions were still carried out manually, as technology grew, this resulted in a technical shift in foreight exchanger transactions from manual to digital. This also certainly affects the fatwa of the National Sharia Council which regulates the buying and selling of foreign currencies. The DSN-MUI fatwa No. 28 concerning the sale and purchase of foreign currencies was formed in 2002. At that time, foreign exchange transactions were still carried out conventionally, so with technical changes to transactions, it was possible that the fatwa needed to be updated so that it was in accordance with the context in society. The approach method in this research is normative juridical. The results of the analysis are described qualitatively and written descriptively. This research found that there are at least some content that is no longer relevant in this digital era, it is necessary to re-discuss it so that the fatwa is in accordance with the existing conditions. This research is expected to be able to contribute ideas, add scientific references and considerations in future research.

Foreign Exchange Transactions in the Perspective of Islamic Economics

Judging from its history, the currency has undergone many changes in meaning. Starting from its existence during the barter period to the modern era of money consisting of fiat money and demand deposits. At this time a new term has appeared virtual money. History records that money has developed its meaning, function and value of money. This change automatically has an impact on changes in the law that applies to it. This article uses a qualitative method with a literature study approach. The data presented in this article are sourced from statutory documents, journals, records, and books related to this research. The legal buying and selling of foreign exchange (forex) are permissible, with the following conditions; There is Ijab accompanied by Qabul (there is an agreement to give or receive). As stated in the MUI fatwa that foreign exchange transactions (al-Sharf) are only permitted if there is a need, for example as a precaution and not for speculation (chance) with conditions that have no legal basis.

EXTERNAL LOBBYING FOR GLOBAL FINANCIAL MARKET STANDARDS AND LEGAL PROTECTION OF RUSSIAN MONETARY AND FINANCIAL SOVEREIGNTY

Introduction. The article is connected with the importance of financial and legal analysis of the level of expediency and effectiveness of the use of external regulatory standards in the financial legislation of Russia as “global initiatives” in order to achieve standardization of monetary and financial regulation. It is noted that the process of introducing legislative initiatives into the financial law of the Russian Federation is subject to external influence through lobbying by self-regulatory and international financial organizations of global financial market standards. It is shown that external lobbying has not only positive, but also negative aspects that threaten the monetary and financial sovereignty of the state. Materials and methods. The most significant global codes of norms and principles of international financial organizations, the provisions of which are lobbied at the level of legislative initiative, are analyzed. Regulatory and analytical materials were used to assess the need for external influence of global financial standards on the legal norms of the Russian Federation in the field of monetary and financial regulation. The synergetic method in law, used by international organizations for the legal regulation of financial markets, is critically evaluated. Results. The lack of clear criteria for the responsible behavior of systemically important and other participants in financial markets in global standards was noted. There is abstract content of legally significant concepts of obligations and responsibilities in the global codes of the IMF, the Bank for International Settlements, the Council for Financial Stability on the principles of transparency of financial markets, on the set of principles of good faith behavior of participants in foreign exchange transactions, on the transparency of balances of payments, etc. Discussion and conclusions. The danger of external lobbying for “soft law” of financial markets lies in the fact that these norms are adopted without discussion at the UN level and without taking into account the interests of UN member states. Global financial standards threaten the monetary and financial sovereignty of states, creating a supranational monetary and financial structure of global regulation, bypassing the applicable law of national states. Not all global financial standards contribute to the development of the Russian financial sector in the context of a national economic growth strategy.