Management Of Financial Institutions Research Articles

The Impact of Fintech Startups on Financial Institutions’ Performance and Default Risk

Introduction: It is highly important to understand the role of financial technology-based startups in the field of financial support. Thus, the study here aimed to investigate the job of fintech solutions or startups in the performance management of financial institutions and the process they use to mitigate risk in financial matters. Literature Review: The economic contraction was most likely the cause of the decline in the value of investments. Understanding the importance of operational efficiency, traditional financial institutions have embraced technology advancements to automate repetitive tasks, lower errors, and save costs. As a result, overall performance and cost-effectiveness have increased. Methodology: The method of data collection that has been selected to investigate the roles that fintech startups play in reducing financial risk is "primary quantitative." As a result, answers to a questionnaire consisting of 13 questions were gathered from 55 people. Findings and analysis: The statistical analysis revealed that the majority of responses were either in agreement or strongly in agreement. Given that the Pearson Correlation value is greater than 0.8, there is a strong correlation between each variable. Every hypothesis formulated during the initial stage of the study has been approved. Discussion: Fintech, which is a combination of finance and technology, uses cutting-edge methods and instruments to improve the overall effectiveness and resilience of risk management frameworks. However, fintech startups face a variety of obstacles along the way, but they are also presented with opportunities for innovation and growth on their optimization journey Conclusion: The adoption of fintech by financial institutions is expected to create a dynamic risk management landscape that can adjust to new opportunities and challenges in the constantly changing financial sector. The primary quantitative method was selected in order to collect the pertinent data for this investigation. Through statistical analysis, the gathering of quantitative data can assist in projecting real-time information.

THE FINTECH EFFECT ON ORGANIZATIONS MANAGEMENT

The article aims to identify and understand the effects that new financial technologies produce on the management of organizations and analyzes, on the one hand, the evolution over time of these technologies, corroborating the concepts and classifications used in the specialized literature, and on the other hand investigates the factors that influenced their appearance, examining in parallel the possible fields of the most critical technologies existing in the financial industry. This study highlights the production of new Fintech technologies, which results in increased competition for the supply of financial services and products and, in return, potentially disruptive changes in these sectors with a determining effect on the management of financial institutions.

Possible Challenges and Recommendations for Risk Managers in Financial Institutions

The article analyses the importance and potential challenges of risk management in financial institutions, highlights the difficulties financial institutions face in identifying, assessing and mitigating the various risks within their organisations, and makes a number of recommendations to The article analyses the importance and potential challenges of risk management in financial institutions, highlights the difficulties financial institutions face in identifying, assessing and mitigating the various risks within their organisations, and makes a number of recommendations to address these issues.This paper explores these challenges, which include spillover effects, cybersecurity issues, efficiency trade-offs between costs and processes, regulatory compliance, and the impact of globalisation. Recommendations are made to address these challenges, such as adopting standardised procedures, embracing technological innovation, identifying emerging risks, and increasing automation of risk management processes. Effective risk management practices are essential to address the complexity of the financial industry and ensure organisational resilience.

Financial literacy induced financial well‐being in Ghana: Does financial inclusion mediate?

AbstractWe investigated the mediating role of financial inclusion in the relationship between financial literacy and financial well‐being in Ghana. Using PLS‐SEM, we found that financial inclusion indeed mediates financial literacy and financial well‐being in Ghana. We also documented a positive and significant relationship between Ghanaians' financial literacy and financial well‐being. Again, financial literacy has a direct positive effect on financial inclusion. Hence, to enhance the impact of financial literacy on financial well‐being in Ghana, policymakers should grant financial institutions enough freedom to offer a variety of financial services; financial institutions that have lost credibility in Ghana (such as insurance companies) should be put in check to build the trust of Ghanaians in them; and the cost of using a mobile phone and internet services to access financial services in Ghana should be reduced. The management of financial institutions can utilize the freedom offered to them by policymakers to offer various financial services to the public, build trust in customers, and offer lower‐cost services to help improve the financial well‐being of Ghanaians.

Penerapan ISAK 35 terhadap Laporan Keuangan Masjid Studi Kasus di Masjid An Nuur Tulungagung

This research aims to analyze the application of ISAK 35 to the financial reports of the An Nuur Mosque in Tulungagung. ISAK 35, as part of sharia-based Financial Accounting Standards, has the aim of ensuring compliance with sharia accounting practices in the management of funds and assets. The An Nuur Mosque was chosen as a case study because of its central role in providing religious and social services in the Tulungagung community. This research involves an in-depth analysis of the An Nuur Mosque's financial reports, focusing on elements related to ISAK 35, such as recording sharia-based transactions, separating amil and zakat funds, as well as disclosing information in accordance with sharia principles. The case study method is used to understand the implementation of ISAK 35 in a practical context and gain a holistic understanding of mosque financial management. The research results are expected to provide a deeper understanding of the extent to which the An Nuur Mosque has complied with ISAK 35 and its impact on transparency, accountability and public trust. The implications of this research can also provide insight for financial managers of mosques and sharia financial institutions to increase efficiency and compliance in managing religious funds. Through this research, it is hoped that practical recommendations will emerge to improve the application of ISAK 35 in mosque financial reports, with the ultimate aim of strengthening the financial integrity and sustainability of mosques as religious institutions. Thus, this research makes a positive contribution to the development of sharia accounting practices in the context of mosque finances in Indonesia

Is the hybrid method more adequate for measuring operational risk?

Research aims: Risk management in financial institutions struggles with setting suitable capital charges for operational losses, resulting in large, disproportionate reserves that impact profits. This study, therefore, aims to develop a tailored operational risk measurement model for general takaful companies, addressing this challenge and optimizing capital allocation.Design/Methodology/Approach: This study employed a hybrid approach, merging the loss distribution approach (LDA) with historical data and scenario analysis for insurance company loss events. Compiling data into distributions, it utilized Monte Carlo simulations to determine value at risk (VaR). The resulting VaR guided the calculation of operational risk capital charges for future periods.Research findings: Measurement using the hybrid method could produce more adequate operational risk capital charges. These results confirm the acceptability of the VaR calculation and have been validated by the Kupic test.Theoretical contribution/Originality: This research offers a more comprehensive alternative method of measuring operational risk by combining historical company data with expert opinions, making it more likely to be practiced in the industry.Practitioner/Policy implication: The results of this study put forward an alternative, more suitable model for industry and regulators to measure operational risk management in general takaful companies.

Performance and Assets and Liabilities Management in the U.S. Credit Union

Abstract Our main research objective is to study the influence of different decisions inherent to allocating assets, and to the weights given to some types of loans on the profitability of credit unions. Only few studies having been carried out on these financial institutions and on their asset portfolio structural change. Another objective is to analyse the influence of increasing deposits, as part of liabilities, on their financial performance. In order to reach our research objectives, we carried out statistical analyses and panel regressions by using biannual data from a large sample of credit unions in the United States. In fact, we analyzed the influence of the choices of allocating some assets and liabilities, represented by ratios, on the profit of credit unions in the United States for 20 years, represented by the return on assets. The results of our analysis enable us to conclude that attracting more deposits would ensure better profitability for these credit unions. As regards to loan types, the increase of the first mortgage loans weight is a profitable strategy. Our research add value to the field of financial institutions management, since most studies concern banks profitability and cannot be generalized to credit unions. Keywords: Credit unions, Credit unions performance, Credit unions asset portfolio structure, Credit union deposits, Assets and liabilities management in banking industry, First mortgage loan.

PRMIA Hungary Chapter and the 2023 Research Conference

Financial risks are a constant challenge for business organizations, and failure to manage them properly often has unforeseen consequences, as many crises have shown. In recent years, the regulation of risk management in financial institutions has increasingly focused on optimizing specific metrics, while a holistic approach, a classic risk management attitude, is necessary to understand and address the challenges of the operation on time. This paper describes the main activities of the Hungarian Chapter of the Professional Risk Managers’ International Association (PRMIA), through the events of the past years. The focus is on the annual research conference of PRMIA Hungary, a selection of articles from which are included in this issue. In recent years, the spectrum of programs offered by the organization has developed and become more colorful, thanks to the voluntary work of the steering committee and the support of corporate partners and sponsors. Our aim is to connect and develop the risk management community, and we welcome all contributions.

Sukuk Türlerinin İkincil Piyasalarda İşlem Görebilmesi ve Borç Satışı Yasağına Göre Analizi

Faizsiz finans kuruluşlarının likidite yönetimlerinde önemli bir rol oynayan sukuk türlerinin ikincil piyasada işlem görebilme kabiliyeti bu kuruluşlar için hayati önem taşımaktadır. Sukuk sertifikalarının ikincil piyasalarda işlem görebilmesi için sukukun borca dayalı değil varlığa dayalı olarak ihraç edilmiş olması gerekir. İslami Finans Kuruluşları için Muhasebe ve Denetim Kurumu (AAOIFI), sukuk hakkında bir standart yayınlamış olup, bu standardın açıkça anlaşılması, sukuk ihraç eden ve likidite yönetiminde kullanan faizsiz finansal kurumlar için oldukça önemlidir. Bunun nedeni, borç satışının fıkhen yasak olması nedeniyle bu finansal kuruluşların bazı sukuk sertifikalarını ikincil piyasada alıp satmamaları ve likidite yönetiminde kullanmamaları gerekliliğidir. Makalenin yazılma amacı; çeşitli ülkelerin devlet kurumlarının ihraç ettikleri sukuk türlerini araştırarak, bu sukuk türlerinin AAOIFI sukuk standardına ve borç satışı (bay’al-dayn) yasağına göre ikincil piyasada alınıp satılmaya uygun olup olmadıklarını tespit etmektir. Makalede bu sukuk türlerinden bazılarının fıkhi açıdan ikincil piyasaya uygun olmadıkları halde likidite yönetimi amacıyla piyasaya sürüldükleri belirlenmiştir.

BMT's Role as a Strategic Partner of Sharia Banks: Reviewing the Effectiveness of Channeling Programs in Creating Islamic Financial Inclusion

This study aims to examine the role of Baitul Maal wa Tamwil (BMT) in increasing the liquidity of Islamic banks in Indonesia. This research uses qualitative research methods with a case study approach. The data used in this study came from several BMTs that have cooperation with Islamic banks in terms of liquidity. The data collection techniques used in this study were observation and documentation. The data analysis technique used in this study is qualitative data analysis with a descriptive analysis model. The results of this study show that BMT acts as a strategic partner of Islamic banks in terms of liquidity, both through the placement of deposit funds, the purchase of Islamic money market instruments, the distribution of productive financing, and the development of Islamic financial inclusion. BMT also has a fairly high liquidity performance, with ratios that show good numbers and are in accordance with standards set by relevant authorities. BMT is influenced by internal and external factors that affect its liquidity, such as BMT size, capital, profitability, asset quality, market sensitivity, and macroeconomic conditions. BMT has differences and similarities with Islamic banks and other non-Islamic bank financial institutions in terms of liquidity, depending on its characteristics, scale, and scope of business. This research provides theoretical and practical implications for the development of theory and practice of liquidity management of Islamic banks and non-Islamic bank financial institutions in Indonesia, as well as providing suggestions for further research.

EVALUATING THE IMPACT OF MARKETING COMMUNICATION MIX ON CUSTOMER SATISFACTION: THE MEDIATING ROLE OF SERVICE QUALITY DELIVERY

Customers are important stakeholders in the financial industry, and therefore management must place a high priority on their satisfaction. In this paper, we investigated the impact of marketing communication mix on customer satisfaction being mediated by service quality within the financial industry. Data was drawn from marketing and sales managers of financial institutions, non-financial institutions, and microfinance companies. A sample of 372 marketing and sales managers participated in this study from financial, non-financial, and microfinance institutions across the three business regions in Ghana. The study deployed the quantitative approach to achieve the objective set. Partial Least Square-Structural Equational Modeling version 3.3 was adopted in this study to analyze the data and its processing. Out of the eleven hypotheses formulated, seven of them were significant, while four were insignificant. According to the findings, firms with greater levels of marketing communication mix should employ this performance metric to attract and achieve high-quality customer satisfaction because customer satisfaction is critical to a company's success. To management, it set a ground for them as superintendents of businesses to tailor-make their products in line with the customers’ preferences and satisfaction. The limitations and future research directions are equally presented in the paper.

The Impact of Transitory Climate Risk on Firm Valuation and Financial Institutions: A Stress Test Approach

Addressing recent calls by European regulatory and supervisory authorities, we develop a new bottom-up climate risk assessment method to examine the resilience of the European banking industry regarding transitory climate risks. We illustrate our approach by estimating the impact of a 50–100 EUR carbon tax per tCO2\\documentclass[12pt]{minimal} \\usepackage{amsmath} \\usepackage{wasysym} \\usepackage{amsfonts} \\usepackage{amssymb} \\usepackage{amsbsy} \\usepackage{mathrsfs} \\usepackage{upgreek} \\setlength{\\oddsidemargin}{-69pt} \\begin{document}$$\ extit{tCO}_{2}$$\\end{document} equivalent on the valuation and default risk of STOXX Europe 600 firms. For about 5% of the sample firms, we find asset devaluation shocks larger than 30% and for about 16% of the firms probabilities of default (PDs) dropping below investment-grade level of 3%. At the sector level, our results yield asset devaluations shocks of 15–36% and new PDs of 5–34% for the six most affected sectors. Running a stress test on credit risk based on these results, we find a decrease in capital ratios between -1.2\\documentclass[12pt]{minimal} \\usepackage{amsmath} \\usepackage{wasysym} \\usepackage{amsfonts} \\usepackage{amssymb} \\usepackage{amsbsy} \\usepackage{mathrsfs} \\usepackage{upgreek} \\setlength{\\oddsidemargin}{-69pt} \\begin{document}$$-1.2$$\\end{document} and -1.6\\documentclass[12pt]{minimal} \\usepackage{amsmath} \\usepackage{wasysym} \\usepackage{amsfonts} \\usepackage{amssymb} \\usepackage{amsbsy} \\usepackage{mathrsfs} \\usepackage{upgreek} \\setlength{\\oddsidemargin}{-69pt} \\begin{document}$$-1.6$$\\end{document} percentage points for key regulatory capital ratios in the most adverse scenario while only addressing 36% of the bank’s total risk-weighted assets. Our analysis sheds light on the substantial transitory climate risk for asset portfolios of banks and contributes to the pressing question how to integrate climate risk into risk management and regulation of financial institutions.

Knowledge Creation and Business Process Re-Engineering Outcomes of Financial Services

Purpose - The researcher investigates the extent to which knowledge sharing moderates the relationship between knowledge creation and business process re-engineering (BPR) outcomes of financial services offered by financial institutions in Uganda. Design/Methodology - The study adopted cross-sectional survey design to collect data at one point in time using self-administered questionnaire to examine the relationship between knowledge creation and business processes. The study at first used statistical package for social scientists to establish clusters among the surveyed financial services and later a model was derived using R programming software to test for knowledge creation and business process re-engineering performance outcomes. Findings - The study found a significant conditional effect of knowledge sharing on knowledge creation and business process re-engineering outcomes. Implying that investment in knowledge sharing creates awareness about the financial services outcomes of financial institutions using business process re-engineering to provide financial services. Originality - This study contributes to business process re-engineering literature by advancing the idea that BPR is an important economic resource that enhanced through instituting knowledge creation and sharing practices in a complex environment. Ideally, creating and sharing knowledge is one of the drivers of customer value, efficiency, and effectiveness of financial services in financial institutions. Practical Implications - Managers of financial institutions need to pay keen interest in managing business processes using relevant knowledge and transforming in new products, new processes, and new markets to boost business process re-engineering outcomes by building a strong knowledge creation system through training and development programs for senior managers.

ANALISIS MANAJEMEN KREDIT GUNA MEMINIMALISIR KREDIT BERMASALAH (STUDI KASUS PADA KOPERASI SIMPAN PINJAM CITRA SEJAHTERA TULUNGAGUNG)

Credit management is an important part of the overall management of financial institutions, because the majority of the income of bank and non-bank financial institutions relies on the credit sector. By implementing maximum credit management, the risk of non-performing loans can be minimized so that the income generated will be maximized. The research method used in this study is descriptive research with a quantitative approach. This data analysis analyzes credit management, the percentage of Non-Performing Loans (NPLs) from 2018 to 2020, and how to save non-performing loans at the Citra Sejahtera Tulungagung Savings and Loan Cooperative. The credit management applied has not been effective in minimizing non-performing loans. This is known from the results of the analysis of the calculation of the percentage of Non-Performing Loans (NPL) of the Citra Sejahtera Tulungagung Savings and Loan Cooperative from 2018 to 2020 continues to increase. Based on the results of the NPL calculation analysis, it shows that in 2018 the percentage of NPL was 0.58%, in 2019 it was 0.93%, and in 2020 it was 7.36%. The way to save non-performing loans carried out by the Citra Sejahtera Tulungagung Savings and Loan Cooperative is rescheduling, restructuring, and providing guidance to customers in resolving their credit arrears.

Financial Management Related to Fiqh Muamalah in Bengkalis City

Humans cannot fulfill their needs only by their own efforts. There are times when you need things that are owned or managed by someone else. So to facilitate the exchange system required money. While institutions related to money are financial institutions. This research is a literature study on fiqh muamalah money and financial institutions, so that it can be seen what discussions have been researched and discussions that need to be researched. This study uses a qualitative approach. There are 30 articles published in 2021 to 2022 which are grouped into two main topics, namely the topic of money and the topic of financial institutions. The topic of discussion of money is then grouped into three sub-topics, namely: 1) dinar dirham, 2) the use of E-Money, and 3) virtual currency (cryptocurrency). And the topic of discussion of financial institutions is also grouped into three sub-topics, namely: 1) implementation of contracts at financial institutions, 2) management of financial institutions, and 3) supervision of financial institutions. The topic of financial institutions with sub-topics of contract implementation at financial institutions is the most articles with a 33.4% presentation. While the articles that were the least discussed were the dinar and dirham sub-topics on the topic of money, with a presentation of 3.3% of the overall theme of money and financial institutions. Discussions that need to be researched, such as: the law of buying and selling currency in Islam, the exchange rate in the perspective of Islamic economics, monetary in the view of Islam and the relationship between money and financial institutions in fiqh muamalah.

Issue of Ukrainian financial sector information security

Protection of financial resources is one of the priority tasks of the state, which determines its independence and subjectivity. This is especially relevant in the case of Ukraine, which is conducting full-scale military operations, therefore the study of the cyber security problem of the financial sphere of Ukraine and the formulation of recommendations for their solution became the purpose of this study. Methods of statistical analysis, systematization and synthesis were used to analyse the dynamics in the field of protection of critical information, whereas the intelligence method, based on open sources, was used to reveal the main trends, methods, and tools of modern cyber fraud. As a result, a list of problems and threats to the financial sector of Ukraine was formed. An assessment of existing trends in the effectiveness of countering such challenges is given, and several recommendations have been developed to prevent the leakage of personal data and the vulnerability of financial structures. Such recommendations included the introduction of clear algorithms for personnel behaviour, separation of subsystems with different levels of access and their restriction of access to external networks, as well as personal digital security rules – use of two-factor authentication, prohibition of transmission of passwords and temporary codes, etc. In the context of the dynamics of the growth of the number of Internet users over the last five years in the world, the international principles of ensuring information security and the legislation of Ukraine, which regulates actions to protect against cyber-attacks, were analysed. The practical significance of the research lies in finding ways to solve problems in the field of information security of the financial sector and forming recommendations that may be useful to the management of financial institutions

RISK MANAGEMENT IN AFRICA'S FINANCIAL LANDSCAPE: A REVIEW

This review paper examines the critical role of risk management in Africa's financial landscape. It sets out to achieve three primary objectives: to explore the historical development of the financial sector in Africa, review the literature on risk management in financial institutions, and evaluate the effectiveness of regulatory measures in ensuring financial stability. The study uncovers key findings that underscore the growing significance of effective risk management practices in African financial institutions. It highlights adopting advanced technologies and regulatory harmonization as pivotal factors shaping risk management approaches. Additionally, the research underscores the importance of sustainable finance and the integration of Environmental, Social, and Governance (ESG) factors into risk assessments. These findings emphasize that risk management not only ensures financial stability but also contributes to sustainable and responsible financial practices. The broader implications of this study extend to economic stability, investor confidence, and cross-border cooperation. Effective risk management practices mitigate financial risks and support the ongoing regional integration efforts in Africa, such as the African Continental Free Trade Area (AfCFTA). Ultimately, the study underscores that the future prosperity of African economies is closely tied to embracing evolving risk management practices, fostering a resilient financial landscape in the region.
 Keywords: Risk Management, Financial Institutions, Africa, Financial Stability, Regulatory Framework, Sustainable Finance, Regulatory Compliance, Cybersecurity, Crisis Management, Data Privacy.

Reward Management and Employee Commitment in Financial Institutions in Uganda: A Case of Postbank Uganda Limited, Loan Department in Northern Uganda

Reward Management and Employee Commitment in Financial Institutions in Uganda: A Case of Postbank Uganda Limited, Loan Department in Northern Uganda

Board Characteristics and Bank Performance after the Global Financial and Economic Crisis – Do People Matter?

The study focuses on the impact of board characteristics on the performance of major international banks following the global financial crisis of 2008. Aspects such as the stability of governance structures, gender equality policies, and the correlation between board composition and key success indicators are analyzed. The relationships between efficiency, age, and gender of board members are explored, emphasizing the significance of dynamics in these structures for successful financial institution management. The study refrains from explicitly mentioning specific banks, providing insights into the broader issues surrounding governance in the post-crisis banking sector.

In the pursuit of financial innovation-Led financial inclusion: A proposed construct for financial trust

The study develops a comprehensive scale of trust in the financial system, to account for its various dimensions. A multistage approach is adopted in the study for this purpose. After reviewing relevant literature and conducting focused group discussions, we collected data from investors through a questionnaire. Finally, we use principal component analysis (PCA) to perform exploratory factor analysis (EFA) in order to investigate the relevant items in each dimension with confirmation of reliability and validity. Our results suggest that 48 items, distributed across five sub constructs of trust, can be applied to assess trust in the financial system. Among the many sub constructs of trust, we ultimately conclude that structural assurance, competence, integrity, benevolence, and transparency are most applicable to financial trust. Because trust is an important consideration along with other barriers to financial inclusion, the study offers many insights for managers of financial institutions, regulatory authorities, and policy makers.