Bank Managers Research Articles

Factors affecting customer retention in banking sector

The main purpose of this research is to measure customer retention through elements such as switching barriers, customer perception of value, customer satisfaction, online relationships, and trust. Data was collected from 135 customers of banking services in Kosovo using purposive sampling. The statistical software SPSS was used for the analysis. We used multiple linear regression to determine the influence of factors affecting client retention. Based on the research results, we conclude that online relationships, customer satisfaction, and trust positively and significantly influence customer retention. Online relationships, on the other hand, had the most significant influence. Customer retention is negatively impacted by customer value and switching barriers. The research findings provide recommendations for bank managers concerning the services they offer and the technical elements of service delivery. The presented recommendations can be viewed as elements whose implementation enables banks to provide added value to their clients and gain loyal and long-term customers.

Board Structure and Financial Stability of Commercial Banks in Rwanda

Purpose: To assess the relationship between board structure and financial stability has been a subject of extensive research and debate globally. Methodology: The target population for this study consists of the board members from the 13 commercial banks operating in Rwanda. The sample of the study was nine commercial banks based on purposive sampling technique. Findings: Panel regression analysis was used and the findings indicated that board size significant affected financial stability of the banks negatively; board independence insignificantly affected financial stability of the banks positively. The outcome further indicated that board gender diversity insignificantly affected the banks financial stability negatively while board age affected the financial stability of Rwandan commercial banks insignificantly and positively. Unique Contribution to Theory, Practice and Policy: The study recommends that the regulatory bodies and bank management should consider implementing guidelines to optimize board composition. Specifically, banks should aim to establish a more streamlined board structure that balances diversity of thought with effective governance. This could involve setting a maximum limit on the number of board members, ensuring that boards remain manageable and conducive to clear communication and swift decision-making.

Enhancing digital currency adoption: examining user experiences

PurposeThis study aimed to analyse user experiences and perceptions of eRupee banking applications in India, focussing on understanding the key factors driving user satisfaction and dissatisfaction.Design/methodology/approachA comprehensive text-mining approach was employed to analyse 5,176 user reviews collected from the Google Play Store. Sentiment analysis and latent Dirichlet allocation (LDA) were used to classify reviews and uncover prevailing themes.FindingsThe analysis revealed that positive reviews highlighted the themes of usefulness, convenience, satisfaction, app attributes, and ease of use. Negative reviews emphasise issues related to lack of trust, faulty updates, unreliability, security concerns, and inadequate customer support. The Logistic Regression model demonstrated superior performance in predicting user sentiments, achieving an AUC of 0.7926 and an accuracy rate of 77.90%.Research limitations/implicationsThis study was limited to reviews from a single-platform source. Future research could incorporate data from multiple online sources and employ qualitative methods to gain deeper insight. Additionally, longitudinal studies and cross-cultural analyses are recommended to capture evolving user sentiments and global perspectives.Practical implicationsThe findings provide actionable insights for bank managers, app developers and policymakers to enhance eRupee applications by addressing identified issues and leveraging positive aspects to improve overall user experience and satisfaction.Originality/valueThis study makes a novel contribution to the literature on digital currency and advanced text-mining techniques using machine-learning models to analyse user feedback in the context of an emerging economy. The proposed conceptual model and practical recommendations serve as the foundation for future research and practical development in digital financial services.

Analysis of the Current Situation of Liquidity Risk Management in China's Commercial Banks and the Proposed Countermeasures

This paper discusses in depth the importance of liquidity risk management in commercial banks and the challenges it faces at a time of accelerated global economic integration. Financial globalization not only brings unprecedented development opportunities for the banking industry, but also exposes it to more complex and volatile liquidity risks. As an important part of the financial system, the sound operation of commercial banks is crucial for maintaining financial stability and healthy economic development. The article focuses on the current situation of liquidity risk management in Chinese commercial banks and reveals the core issues of weakening deposit base and loan expansion aggravating liquidity pressure through detailed analysis. Subsequently, a combination of literature review and case studies is used to analyze the dual impact of macroeconomic fluctuations and micro-management deficiencies on liquidity risk. Ultimately, the study concludes by emphasizing the key roles of the improvement of the government regulatory system and fintech in optimizing the asset and liability structure of banks and enhancing the efficacy of risk management, which together safeguard the sound operation of the financial system and the sustained and healthy development of the economy.

Food Insecurity, Comorbidities and Intersectorality in Food Banks: A Multiple Case Study

Objective: To develop a system of communication between the sectors (health, social assistance, education) in order to prevent the worsening of the health conditions of those assisted. Theoretical Framework: the text presents the concept and purpose of food banks in Brazil and around the world, their relevance and the intrinsic relationship between food insecurity and comorbidities. Method: Multiple case study involving the Food Banks of Itanhaém-SP, Carinhanha-BA and Rosário do Catete-SE to analyze the situation in different Brazilian states. Results and Discussion: The research indicated that the proposed system proved promising in reducing the distress of the people assisted, highlighting the effectiveness of an integrated approach between the different sectors involved. Research Implications: The research suggests that the proposed communication system can contribute significantly to improving coordination between the different agents of assistance and public policies integrated into the Food Banks, with the potential to improve food security and the health conditions of the people assisted. Originality/Value: The intersectoral approach through more agile communication is an innovation in the management of Food Banks, aligning them more concretely with SDG 2030, especially SDGs 1, 2 and 3.

Optimizing dormant account management in UAE banking: Legal gaps and proposed reforms

The management of dormant accounts and unclaimed balances is a pressing challenge in the banking sector of the United Arab Emirates (UAE), particularly given the complex regulatory landscape. This study analyzes 150 dormant accounts across five major UAE banks (Emirates NBD, First Abu Dhabi Bank, Dubai Islamic Bank, Sharjah Islamic Bank, and Abu Dhabi Commercial Bank) and identifies gaps in the legal framework, including the absence of clear definitions and handling of non-monetary assets.The study investigates the legal framework governing dormant accounts, specifically focusing on the Dormant Accounts System No. 1 of 2020. The results highlight critical issues, including the lack of clear timelines for transferring unclaimed balances and inconsistencies in communication protocols for notifying account holders. Furthermore, the study emphasizes the need for standardized practices across financial institutions in the UAE.To address these challenges, the study proposes legislative amendments to improve asset management and consumer protection. Key recommendations include establishing standardized definitions, implementing automated tracking systems for dormant accounts, and integrating dormant balances into social welfare programs to enhance public trust. These reforms could significantly improve operational efficiency and legal clarity in the UAE banking sector, contributing to a more transparent and effective management of dormant accounts and unclaimed balances. Acknowledgments The authors are thankful to the Deanship of Graduate Studies and Scientific Research at the University of Bisha for supporting this work through the Fast-Track Research Support Program.

Diagnosing the Gap in Operational Requirements for the Compliance Management System According to the International Standard ISO 37301:2021 In the General Management of Al-Rasheed Bank / An Applied Research

The research deals with diagnosing the gap in the 8th requirement (operations) of the Compliance Management System according to the international standard (ISO 37301:2021) at the General Administration of Al-Rashid Bank, which concerns the planning, implementation, and control of processes and procedures designed to address risks and opportunities. The problem of the research lies in the failure to adopt a compliance management system as per the ISO 37301:2021 standard, which has affected the performance of its banking tasks and exposed it to non-compliance risks. Therefore, a compliance management system is required to reduce the likelihood of such risks, which is the main objective of the research. The study compares the current operations of the compliance management system at Al-Rashid Bank with the operational requirements specified in ISO 37301:2021, using audit checklists for this requirement in order to diagnose non-compliance gaps and provide a qualitative analysis of the existing gap. The research relied on percentages and weighted arithmetic means, and found that the application and documentation of the operational requirement at the bank were insufficient, with a gap percentage of 45.84%. Thus, addressing these gaps requires improvements and system reviews to reduce them.

RELATIONSHIP BETWEEN ECONOMIC RISK AND FINANCIAL, PERFORMANCE OF COMMERCIAL BANKS IN KENYA

Financial institutions play a key role in spurring the growth of the economy. Commercial banks operate in a highly volatile environment which threatens their ability to achieve their desired goals. The purpose of this study was to establish the relationship between economic risk and the financial performance of commercial banks in Kenya. The study was anchored on agency and prospect theories. Longitudinal and cross-sectional research design was used. The study population was 42 commercial banks in Kenya. 32 purposively sampled commercial banks which had audited financial accounts for the years 2016 to 2021 were included in the study. Secondary panel data collected using an extraction tool validated by experts from banks and academia was analyzed using R statistical software version 4.3.2. Reliability of the data was ensured by using audited financial reports. Descriptive and inferential data analysis techniques were used. Inferential statistics used were linear mixed effects multiple regression allowing random effects to vary by banks. The study findings showed that economic risk significantly influence financial performance with high liquidity and credit risks associated with lower ROE (beta; -10.36; 95% Confidence Interval (CI): ( -18.45 to -2.27), p-value: 0.012) and (beta: -0.29; 95% CI (-0.46 to -0.13), p-value: 0.001.)The study concluded that there is a statistically significant relationship between economic risk and financial performance of commercial banks in Kenya. Based on the findings from this study, it is recommended that commercial banks may adopt a holistic approach to risk management by emphasizing economic risks. This study may significantly benefit the government, CBK and the commercial bank management in Kenya to inform policy framework as well as the academia and researchers as far as economic risk and financial performance of commercial banks is concerned.

PROFITABILITY DETERMINANTS OF INDONESIAN ISLAMIC BANKS: FINANCING TO DEPOSIT RATIO AND GOVERNANCE

This study examines the impact of the FDR on the profitability of Islamic commercial banks in Indonesia, GCG as an intervening variable. The analysis utilizes financial data from 2015 to 2019, collected from annual reports and financial statements of selected banks. The study employs regression and mediation analyses to test the hypotheses. The results indicate that FDR does not significantly affect profitability, measured by ROA. Furthermore, GCG does not mediate the relationship between FDR and ROA. These findings suggest that other factors may play a more critical role in determining the profitability of Islamic banks. The study underscores the importance of adopting conservative financing strategies and enhancing corporate governance frameworks tailored to Sharia compliance. These insights provide valuable recommendations for bank managers and policymakers to improve financial performance and ensure sustainable growth in the Islamic banking sector.

Factors That Influence Cybersecurity Compliance Behaviours by Bank Employees: A Case of Banks Operating In Kenya

Digitization of transactions in Banks has developed exponentially since the advent of the internet technology. This has brought about efficiency and high quality service delivery at all times. However, cyber threats also continue to grow exponentially in spite of various initiatives to counter the threats. There are numerous technology initiatives to address the issue of cyber threats but the problem still persists. There is very limited research on how to leverage on human behaviours to effectively improve Cyber security compliance behaviours in Banks. Investigating Cyber security Compliance behaviours in Banks has therefore become inevitable. The main purpose of this study was to determine the factors that influence cyber security compliance behaviours in banks operating in Kenya. This was accomplished using a model that was based on an integration of three theories: Institutional Theory, the Protection Motivational Theory (PMT) and the General Deterrence Theory (GDT). In order to empirically test the relationships between the independent and dependent variables, data were collected from 75 purposively selected bank employees in Kenya. The Research was carried out using the mixed (both quantitative and qualitative) approach and survey tools used to collect data were verified for reliability and validity before being used. Data analysis was carried out using SPSS Version 25.0, MS Excel 2013, and WarpPLS (SEM) Version 7.0. The findings of our study indicate that the direct paths from the independent variables “Normative pressure” (p = 0.026, β = 0.213), “Self-Efficacy” (p < 0.001, β = 0.440), “Punishment certainty” (p = 0.024, β = 0.217), “Age” (p = 0.013, β = 0.243), “Prior experience with computers” (p = 0.004, β = -0.284) were found to have a positive, direct and significant influence on a bank employee cyber security compliance behaviours. “Top management commitment” was found to partially mediate between self-efficacy and Cyber security compliance behaviours. Bank management may find the results useful for future policy formulation in relation to cyber-security compliance behaviours. Researchers and scholars may also find the results useful in terms of contribution to the body of knowledge and further investigation to fill the gaps identified by the study.

MANAGING FRAUD IN CONTEMPORARY BUSINESS ENVIRONMENT, THE ROLE OF INFORMATION SECURITY MANAGEMENT: A STUDY OF QUOTED DEPOSIT MONEY BANKS (DMBS) IN NIGERIA

Every economy relies on the banking sector to boost economic growth and development because of its intermediary role. However, the Nigerian banking sector has been plagued with the risk of fraud which has led to the loss of huge amounts of money annually. This challenge has put pressure on the management of banks on how best to curb the fraud scourge. Although several studies which relied majorly on the traditional method of fraud management have been carried out on how to reduce the frequent occurrence of fraud in the banking sector, the problem persists. Therefore, this study took a different approach to examine the role of information security management on fraud risk management in Deposit Money Banks (DMBs) in Nigeria. The study employed a survey research design. The population of the study was 1,030 staff of the Internal Control, Internal Audit and Information Technology departments of DMBs in Nigeria. A sample size of 288 was determined using Taro Yamane’s formula. The respondents were purposively selected from 12 listed banks as at 31st January 2024 due to the role they play in fraud risk management. A structured and validated questionnaire was distributed and 99.7% response rate was achieved. Cronbach’s alpha reliability coefficients for the constructs ranged from 0.864 to 0.952. Descriptive and inferential (multiple regression) statistics were used to analyze the data. Utilizing a regression model, the research examines three key proxies of information security management: Application Security Control (ASC), Access/Authentication Control (AAC), and Network Security Control (NSC) and one proxy (Fraud risk governance - FRG) for fraud risk management The model reveals that both ASC and AAC have significant positive effects on FRG, with coefficients of 0.216 and 0.247, respectively, while NSC, with a coefficient of 0.080, does not significantly influence FRG. The model's adjusted 𝑅2 value of 18.9% indicates that these controls collectively explain a modest portion of the variability in FRG, suggesting the presence of other influential factors. The findings highlight that strengthening ASC and AAC can substantially enhance fraud risk governance in Nigerian DMBs, whereas NSC requires further investigation to understand its role. The significance of the overall model, supported by an F-statistic of 21.939 (p 0.05), underscores the importance of integrated information security management in mitigating fraud risks. Additionally, the study aligns with existing literature advocating for the integration of advanced information security management and traditional fraud management methods. The study recommended that the board of directors of DMBs as part of its oversight function should periodically review the overall fraud risk management framework of the bank to ensure it is current, adequate and effective.

INVESTMENT IN INTELLECTUAL CAPITAL AND ITS IMPACT ON THE PROFITABILITY OF ISLAMIC BANKS IN INDONESIA

Introduction: Islamic banks in Indonesia show significant potential, although their current asset contribution is only 1,9 percent of total Islamic banking asset globally. This is quite a contrast to Indonesia’s title as the country with largest Muslim population in the world, as well as its ambition to become the center of the global sharia economy. One of the efforts that can be made to achieve this goal is by increasing the assets of Indonesian Islamic banks through enhancing their profitability. Methods: This research uses secondary data from eight Sharia Commercial Banks (BUS) in the 2014-2022 period. A static panel regression model is used to examine the impact of Intellectual Capital on the profitability of BUS using Stata 17 application. The dependent variable is profitability, while the independent variables are IC and its components (Human Capital, Structural Capital, Customer Equity, and Relational Capital). The control variables consist of the ratio of total equity to total assets (EQA), non-performing financing (NPF), inflation, and the COVID-19 phenomenon. Results: This study analyzes the impact of intellectual capital (IC) on the profitability of Islamic banks in Indonesia. The results show that IC has a significant positive effect on profitability. The components of human capital (HC) and capital employed (CE) contribute positively, while structural capital (SC) and relational capital (RC) do not have a significant impact. Conclusion and suggestion: Findings of this research indicate that improving human resource competence and optimizing equity capital can enhance the profitability of Islamic banks, whereas investments in organizational structure, technology, and promotion do not yield significant effects. This study also provides policy implications for regulators and bank management in more effectively allocating IC investments. Additionally, the research suggests that Islamic banks should focus on digitalization and financial innovation to strengthen their performance.

Exploring the Mediating Role of New Product Performance in the Link between Service Innovation and Organizational (Financial and Non-Financial) Outcomes in Ghanaian Banks

This study examines the mediating role of new product performance in the relationship between service innovation and both financial and non-financial performance in selected banks in Ghana using the dynamic capability theory as the theoretical lens. The study employed a descriptive research design to frame the study’s methodology. The target population consisted of 159 commercial and community banks in Ghana. Utilizing a quantitative research approach, a structured questionnaire was used to gather data from 113 sampled respondents through purposive sampling, Structural Equation Modeling (SEM) was employed to analyze the data and assess the proposed relationships. The results reveal that service innovation has a direct and positive impact on the financial performance of banks, with a b coefficient of 0.316, affirming its importance in enhancing profitability and market share. However, the relationship between service innovation and non-financial performance was negative. Despite this, new product performance emerged as a significant mediator, strengthening the positive impact of service innovation on financial performance, with a b coefficient of 0.245 and a t-statistic of 2.409. The mediation effect of new product performance on the relationship between service innovation and non-financial performance was also validated, indicating that while service innovation alone may negatively affect non-financial outcomes, introducing successful new products can mitigate this impact. These findings contribute to the understanding of how service innovation influences different aspects of organizational performance in the banking sector. The study offers practical insights for bank managers, emphasizing the need to focus on new product development to maximize service innovation's benefits.

The Impact Of Revenue Diversification On Bank Profitability And Stability: Evidence From Indonesia Banking Industry

Purpose: This study aims to examine the effect of income diversification on the financial health of banks in Indonesia, focusing on income sources that significantly contribute to improving profitability and financial stability. Methodology/approach: This study uses a quantitative approach (positivism) which an associative nature. The research population consists of banking companies listed on the IDX from 2020-2023, with a sample of 168 observations selected using the purposive sampling method. The data analysis technique employs panel data regression using Eviews 12 software. Findings: The results of the regression analysis show that, total revenue diversification has a positive effect on profitability, but a negative effect on financial stability. Meanwhile, the proportion of non-interest income has a negative effect on profitability, but a positive effect on financial stability, with commission income as the most stable component of non-interest income and increasing profitability. Practical implications: This research contributes to helping bank management to be prudent in implementing income diversification strategies, by prioritizing interest income and avoiding high risk in non-interest income. The findings can also be taken into consideration for regulators in encouraging a balanced diversification strategy to maintain financial stability. Originality/value: The update in this study uses additional measurements to reveal the value of diversification that has not been discussed by previous researchers. This measurement is to differentiate diversification conditions that have similar values so that they are not considered the same. In addition, researchers also added control variables to increase the validity of the research

The Role of CSR Report Assurance and ESG Rating in Bank Manager's Judgement on ESG Lending Decisions

The Role of CSR Report Assurance and ESG Rating in Bank Manager's Judgement on ESG Lending Decisions

Enhancing Bank Performance: Integrating Enterprise Risk Management with Mobile Banking Applications

This study investigates how the implementation of mobile banking and enterprise risk management (ERM) contributes to the success of financial institutions in a rapidly evolving financial environment. To understand the relationship between ERM, mobile banking adoption, and bank performance, we surveyed 250 senior bankers from the 25 largest banks in Indonesia using Partial Least Squares Structural Equation Modeling (PLS-SEM). Our findings indicate that effective ERM implementation positively affects bank performance. Mobile banking enhances customer convenience, streamlines operations, and broadens market reach, increasing customer satisfaction, operational efficiency, and profitability. Additionally, using mobile banking applications mediates the positive indirect impact of ERM on bank performance. This research highlights that ERM's effect on Indonesian banking performance is partly mediated by adopting mobile banking applications. The study contributes to the literature on RBV theory, which suggests that banks can create innovative ERM strategies and leverage its unique resources, such as mobile banking, to remain competitive and sustain their performance. The innovation aligns with the principles of TAM, which highlights the significance of perceived usefulness and ease of use in technology adoption.

The Impact of Asset & Liability Management on Profitability: Evidence from Selected Private Commercial Banks in Ethiopia

This research meticulously investigates the intricate interplay between Asset and Liability Management (ALM) practices and the profitability dynamics of selected private commercial banks in Ethiopia over the period spanning 2011 to 2023. Employing a comprehensive fixed effect balanced panel regression analysis across a time horizon of 13 years and encompassing data from ten meticulously chosen banks, this study sheds light on critical aspects of financial management in the banking sector. Utilizing a quantitative approach and an explanatory design rooted in secondary data extracted from audited financial statements, the study rigorously examines a spectrum of key variables. These variables include income diversification, liquidity, bank size, GDP, asset quality, capital adequacy, loan and advance, and operational efficiency, all meticulously analyzed using E-view 12 econometrics software. The research findings underscore the pivotal significance of certain factors in enhancing bank profitability. Notably, asset quality, liquidity ratio, GDP, loan and advance, and bank size emerge as positive influencers on bank profitability, exhibiting statistically significant impacts. Conversely, operational efficiency and income diversification were found to exert negative effects on profitability. Surprisingly, capital adequacy was established as statistically insignificant in this context. This study accentuates the critical importance of asset quality, operational efficiency, liquidity management, bank size, GDP, income diversification, and loans as fundamental drivers of banks' return on assets. By accentuating the strategic significance of these variables, bank managers are equipped to navigate the complex financial landscape, leveraging effective ALM strategies to optimize profitability and ensure sustained financial viability.

Construction and Initial Validation of Measures Regarding Human Milk Donation: An Application of the Theory of Planned Behavior

Objective: to construct and validate measures related to human milk donation (HMD), based on the theory of planned behavior (TPB). Theoretical framework: it is assumed that TPB can be used to explain and predict HMD behavior and the construction of these measures should consider reflective and formative measures. Method: a questionnaire was developed with 12 direct reflective measures and 30 indirect formative measures and applied to a sample of postpartum women eligible to donate. The reliability of the direct measures was verified by the internal consistency criterion, using Cronbach's alpha and composite reliability. The reliability of the indirect measures was verified by the temporal stability criterion, using the test-retest technique and the intraclass correlation coefficient. The construct validity of the direct measures was established through the convergent and discriminant validity of these measures. The construct validity of the indirect formative measures was established through convergent validity, the assessment of collinearity problems and the assessment of the significance and relevance of the formative measures. Results and conclusion: the reliability and validity of the direct reflective and indirect formative measures indicated that they are reliable and acceptable. Research implications: this questionnaire can be used to predict HMD behavior, which in turn can improve donor recruitment management in human milk banks. Originality/value: a questionnaire with direct and indirect measures of the TPB on HMD is unprecedented.

The relationship between technology infrastructure and bank credit: How should management promote ASEAN economies?

Purpose: This study aims to analyze the causal relationship between technology infrastructure and bank credit, as well as the impact of this relationship on economic growth in ASEAN economies. Design/methodology/approach: To achieve this objective, the authors model the simultaneous relationship between these factors using a panel vector autoregressive (PVAR) approach. Findings: The estimation results indicate a positive correlation between technology infrastructure and bank credit. Furthermore, technology infrastructure plays a crucial role in promoting economic growth, while bank credit can indirectly influence economic growth through technology infrastructure, a novel finding compared to previous studies. Besides, the authors identify significant effects of government spending, foreign direct investment, and trade on economic growth. The findings provide a reliable foundation for the ASEAN economies to develop appropriate policies regarding the management of technology infrastructure and bank credit to stimulate economic growth. Originality/value: This study aims to analyze the causal relationship between technology infrastructure and bank credit, while also examining the impact of this relationship on economic growth in ASEAN economies. The findings are also expected to provide ASEAN economies with valuable and meaningful insights.

Exploring the impact of loans on credit risk management in Spanish systemic banks

PurposeThis research analyses the solvency behaviour of systemically important (or systemic) Spanish banks, focusing on their credit risk management during the subprime mortgage crisis and the COVID-19 pandemic.Design/methodology/approachThe top three Spanish banks (BBVA, Banco Santander and Caixabank) were selected as a representative sample. Key indicators, such as the volume of assets, amount of financing or loans to clients, non-performing loan (NPL) ratio, reported volume of write-offs, equity and share capital, were analysed to assess their solvency and credit risk management. Furthermore, from the variables evaluated, a structural equation model has been proposed to evaluate the structural relationships among the variables.FindingsThe results indicate a significant reorganisation of these institutions after the subprime crisis. This reorganisation was crucial for providing the necessary room to manoeuvre to overcome the challenges posed by the COVID-19 crisis. However, the study highlights the importance of implementing preventive management policies to handle future crises effectively.Originality/valueThis study provides valuable insights into the solvency and credit risk management of systemic Spanish banks during two major financial crises. The evidence presented is particularly relevant for bank managers and policymakers, offering guidance on effective credit risk treatment and crisis management strategies.