Operations Of Financial Institutions Research Articles

Enhancing Financial Advisory Services with GenAI: Consumer Perceptions and Attitudes Through Service-Dominant Logic and Artificial Intelligence Device Use Acceptance Perspectives

Financial institutions are currently undergoing a significant shift from traditional robo-advisors to more advanced generative artificial intelligence (GenAI) technologies. This transformation has motivated us to investigate the factors influencing consumer responses to GenAI-driven financial advice. Despite extensive research on the adoption of robo-advisors, there is a gap in our understanding of the specific contributors to, and differences in, consumer attitudes and reactions to GenAI-based financial guidance. This study aims to address this gap by analyzing the impact of personalized investment suggestions, human-like empathy, and the continuous improvement of GenAI-provided financial advice on its authenticity as perceived by consumers, their utilitarian attitude toward the use of GenAI for financial advice, and their reactions to GenAI-generated financial suggestions. A comprehensive research model was developed based on service-dominant logic (SDL) and Artificial Intelligence Device Use Acceptance (AIDUA) frameworks. The model was subsequently employed in a structural equation modeling (SEM) analysis of survey data from 822 mobile banking users. The findings indicate that personalized investment suggestions, human-like empathy, and the continuous improvement of GenAI’s recommendations positively influence consumers’ perception of its authenticity. Moreover, we discovered a positive correlation between utilitarian attitudes and perceived authenticity, which ultimately influences consumers’ responses to GenAI’s financial advisory solutions. This is manifested as either a willingness to engage or resistance to communication. This study contributes to the research on GenAI-powered financial services and underscores the significance of integrating GenAI financial guidance into the routine operations of financial institutions. Our work builds upon previous research on robo-advisors, offering practical insights for financial institutions seeking to leverage GenAI-driven technologies to enhance their services and customer experiences.

Trách nhiệm xã hội và hiệu quả tài chính của các ngân hàng thương mại niêm yết: Bằng chứng thực nghiệm tại Việt Nam

This article employs panel data regression model to investigate the impact of Corporate Social Responsibility (CSR) on the Corporate Financial Performance (CFP) of 29 listed commercial banks in Vietnam from 2016 to 2022. The research results reveal the positive influence of CSR on ROE and ROA, whereas the relationship between CSR and Tobin’s Q demonstrates a non-significant negative impact. Based on these findings, the study provides recommendations and policy implications to enhance awareness of CSR and establish encouraging policies and support for implementing CSR in the business operations of financial institutions.

Internal CSR Programs in the Context of a Financial Institution Operating in Nepal

This study investigates the internal corporate social responsibility (CSR) practices of employees in commercial banks and explores the relationship between demographic factors and trust. Adopting a quantitative research design, data were collected through a questionnaire distributed to 40 employees representing various levels and departments within the banks. Purposive sampling was utilized, and ethical considerations were strictly followed. Descriptive and inferential statistical analyses were employed to examine the data. Results reveal gender differences in perceptions of company policies, with females generally showing higher agreement on aspects like career development and work-life balance. Married individuals also tended to perceive higher levels of agreement with company policies compared to unmarried counterparts. Moreover, age and years of service exhibited weak negative correlations with various policy aspects, suggesting limited influence on employee perceptions. Overall, the findings emphasize the importance of tailored CSR practices to address diverse employee needs and preferences, irrespective of demographic factors. These insights can inform strategies to enhance employee engagement and organizational performance in commercial banks.

The Effect of Implementing Good Corporate Governance (GCG) on the Financial Performance of Islamic Banks in Indonesia

The implementation of Good Corporate Governance (GCG) in Indonesia's Islamic banking sector is an important step to ensure transparency, accountability and fairness in the operations of financial institutions. As an integral part of the financial system, Islamic Banks not only provide services in accordance with Islamic economic principles but are also expected to implement good corporate practices to maintain the sustainability and reliability of the financial system.Corporate governance in the banking sector gained attention after the 1997 financial crisis, with the establishment of the National Committee on Governance Policy (KNKG) in 1999. Analysis of previous research results shows variations in the effect of GCG implementation on the financial performance of Islamic banks. Some studies found a significant positive impact, while others showed negative or insignificant results. Variations in results are also seen in performance indicators such as CAR, NPF, ROA, and ROE, reflecting the complexity of the relationship between GCG and aspects of financial performance. Therefore, deeper contextual understanding and improved effectiveness of GCG implementation are needed to understand and maximize its impact amidst increasingly complex financial market dynamics.

Exploring the Relationship Between Financial Institutions and Economic Growth from A Profit Maximization Perspective

Financial institutions, as the primary entities within the business sector, strive to achieve profitability and long-term expansion as their core objectives. Examining the reciprocal association between the advancement of financial institutions and economic growth through the lens of profit maximization holds considerable merit in enhancing the oversight of financial institutions. This paper examines the reciprocal relationship between financial institutions and local economic development from the perspective of profit maximization theory. It investigates the connection between economic growth and the profit acquisition activities of financial institutions, aiming to contribute to the advancement of local economic development. From the standpoint of profit maximization, the operations of financial institutions contribute to augmenting the momentum of economic progress. However, it is important to note that the unregulated expansion of financial institutions can also heighten the vulnerability of economic development, with potential consequences for excessive profit-seeking. Hence, with regards to the objective of maximizing profits, it is imperative for local governments to effectively oversee and manage financial institutions, establish a comprehensive market management framework, facilitate the well-regulated functioning of financial institutions, and foster the advancement of the economy towards high-quality development.

Innovative Applications of Financial Mathematics in Economic and Financial Markets

Under the rapid development of the new economic situation, China's financial market is showing a thriving take-off scene, and the theoretical development and practical cases related to finance are also increasing geometrically. Financial mathematics, as an important theory that emerges at the historic moment, advocates the use of mathematical thinking to guide the discussion of financial theory. Taking advantage of the computational advantages of computers and mathematics, financial mathematics can conduct a deeper exploration of securities in financial markets and market equilibrium. Its formation and development provide strong data support for promoting the normal operation of financial institutions. Starting from the connotation of financial mathematics and its current development status, the author deeply analyzes the innovative application of financial mathematics at the financial market level, hoping to promote the orderly development of financial markets.

The role of money and financial institutions in Kalecki and Keynes

Numerous discussions on money and financial institutions have been advanced both between and within economic theories. Heterodox schools of thought consider money to be non-neutral, with causality running from money demand to money supply and the interest rate as a monetary and distributive variable. In this paper we discuss the views of Michał Kalecki and John Maynard Keynes on money and the operation of financial institutions. Kalecki and Keynes formulated the theory of effective demand, specifically in terms of its effects on economic growth and financial instability. Nonetheless, in line with the work of Tracy Mott, we argue that Kalecki’s analyses of the financial system are more profound because they better capture the complexity of the oligopolistic financial system, providing the foundations for Keynes’ liquidity preference theory. As a result, it may be concluded that the main problem of economic growth and investment spending is the structure of corporate finance.

Law enforcement, social demands and reputation risks as drivers of compliance functions: a comparative analysis of the largest banks’ disclosures in the UK and Brazil

Given the recent recurring cases of financial crime worldwide, national and international regulators have enacted new regulatory instruments intended to prevent or inhibit unlawful acts by banks and their representatives. These stricter regulations regarding the operations of financial institutions have reinforced the importance of best practices and the role of compliance within banks. Nonetheless, regulations regarding compliance structures and functions are not yet mandatory and give great flexibility to banks to define how they will set their compliance programmes. This research aims to understand how compliance functions have been implemented in the two largest banks in the UK and Brazil as a governance mechanism to fight financial crimes such as bribery and corruption. Document analyses of websites and financial reports of these banks examine disclosures provided by these corporations and shed light on the main drivers influencing their transparency regarding compliance functions, roles and responsibilities and their connections to the bank’s operations and profitability goals. This research demonstrates that the implementation and enhancement of compliance functions in UK and Brazilian banks are driven by attempts to respond to regulatory requirements, social demands and as a reputational risk instrument, reflecting different levels of development in each institution. The maturity of these disclosures demonstrates that Brazilian banks present a more reactive attitude, justifying their investments in compliance according to minimum law requirements, while banks in the UK tend to have a more proactive perspective on their compliance initiatives, reinforcing their importance for the bank’s competitive advantage and long-term continuity beyond regulatory compliance.

Comparison of different approaches using Random Forest for imbalanced credit data

Abstract Credit scoring models are extensively used in credit risk management of individual customers. These models are based on econometric methods using past data about customers, both defaulters and non--defaulters. These models focus on the optimal separation between good and bad customers taking into account two types of errors that appear, namely: the False Positive (Type 1 error) and the False Negative (Type 2 error). The purpose of the project was to focus on the problem of unbalanced data. Different balancing methods have been applied to the data set obtained from the financial institution operating in the European market. Various levels of unbalance have been considered and different statistical assessment metrics have been compared.

The Influence and Application of Financial Mathematics in Contemporary Financial Markets

The change of times has promoted the rapid development of the economy, and also stimulated the prosperity of the market. As an important component of the economic market, the continuous improvement of the financial economy requires the support of theoretical knowledge in the financial field. As an important theoretical part of financial economics, financial mathematics, relying on its computer and mathematical advantages, conducts a deeper exploration of securities and market equilibrium in the financial market. After decades of research, it has achieved fruitful results, providing strong data support for promoting the normal operation of financial institutions. Starting from the concept and related theoretical composition of financial mathematics, this article mainly analyzes the impact of financial mathematics on contemporary financial markets, and expounds the application of some core theories of financial mathematics at the market level. The article also briefly explains the current situation of financial markets from the perspectives of theoretical innovation and application issues, and describes the prospects of financial mathematics.

Impact of Foreign Direct Investment on Financial Institution Performance in Nigeria: A Study of Jos Metroplolitan City of Plateau State

Financial institutions are confronted thru gradually keen opposition and increasing effect of supervisory necessities, financial plus high-tech innovations, influential grief and new dares which have melodramatic effects on their concerts. The ambition of this paper is to examine impact of foreign direct investment on financial institution performance in Nigeria. The study was grounded on three theories (revenue maximization principle, pecking order theory and Internationalization Model) in relation FDI performance. This study employs a survey design because which aimed at establishing effects of the variables of independence on dependent variable, population of this study was based on 10 selected financial institution operating in Jos Metropolitan city of Plateau Nigeria as at 1^st January, 2022. Each bank is represented by its Chief finance officer (CFO). Primary data and secondary data was obtained thru yearly financial statement of selected financial institution through the respective Chief finance officers also, books, journals and publications, while primary data was obtained via questionnaire. Descriptive statistics and content analysis were used to analyze the data collected. The results reveled that that FDI variables indicates a strong impact on financial institution performance among Nigeria financial institutions, it recommends that solid framework ought to be set up in order to curtails bottle neck and other issues in relation to FDI among Financial institution performance. The study concludes FDI with financial institutions transaction be able to be intermediated thru its dimensions (Foreign exchange, Capital adequacy, Equity capital and Reinvested foreign earning).

Determinants of Going Concern in the Banking Sector: Evidence from Ghana and Nigeria

ABSTRACT Going concern of entity is of much concern to stakeholders, especially investors of financial institutions since the failure of financial institutions affects a wide range of sectors. The study sought to develop a model to predict going concern of financial institutions. The data were collected from the financial statements of selected banks in Ghana and Nigeria. The binary logistic regression model was employed as the data analysis technique. The model used financial ratios as predictors of going concern. The result revealed that working capital and earnings before interest and tax on total assets are crucial financial predictors for going concern in financial institutions. The implication is that management should maintain adequate working capital and improve upon its earning capacity to sustain the operations of financial institutions.

Digitalization of the banking sector in Hungary

During the pandemic period, considerable attention was paid to the online digital financial services. Tangible services provide tangible benefits to both the national economy and citizens. Easily accessible and popular options contribute to reducing the use of cash, expanding e-commerce and administration, and raising financial awareness, as well as creating a sustainable financial system. The widespread use of digital services ensures connection to the global world, more effective use of opportunities, and thus success either as an individual, as a company, or as a government actor. The emergence of FinTech applications has also been helped by the fact that while the operation of financial institutions is strictly regulated and controlled by the authorities, the operation of technology companies in this field is tied to far fewer mandatory regulations. It is important to note that there are still many issues to be resolved, one of which is the issue of equal regulation of FinTech companies and traditional banks. The purpose of the study is to evaluate the current state of digital banking in Hungary in the field of residential services and highlight the paths for further development. The main statements of the paper are the following: Overall, the level of digitization of the Hungarian banking system can be considered medium. In connection with the COVID-19 epidemic, the digitization of customer relations and products has come to the fore in the sector. Among the loan products, the overdraft facility for individuals and the degree of digitization of personal loans are the highest. At the corporate level, online loan applications are even less resolved, largely due to the evaluation and assessment of complex collateral requirements and the low prevalence of digital solutions for contracting and signing. This article proposes more sophisticated regulations, since the regulatory issues in digital financial innovation pose challenges for regulators. The main task should be to create the conditions for the competitiveness and safe operation of the financial intermediation system in the digital age, so the digital interfaces and communication platforms should be standardized. Regarding to the current EU regulation, the security elements of the digital payment system should be strengthened.

Function Extraction Based on CFPS and Digital Financial Index: Data Mining Techniques for Prognosis of Operational Risks of Financial Institutions

Financial deregulation, financial globalization, and the increasing variety and technological sophistication of the commodities offered by financial services have made the operations of financial institutions more complex. Compared with credit risk and market risk, financial institutions’ transaction risk management plays an increasingly important role in financial practice. As an emerging technology, big data mining technology has a unique advantage in optimizing the processing and management of large amounts of data. Big data mining technology not only has the common functions of finding, comprehensively managing all kinds of information, collecting and analyzing data, and conducting statistics but also should have the ability to process information that is hidden and useful in the database through data mining technology. Based on CFPS and data mining technology, this paper analyzes the operational risk of financial institutions, analyzes the causes of the operational risk of financial institutions, discusses the measures to avoid the operational risk of financial institutions, and draws corresponding conclusions.

Process Improvement for Error Records in a Financial Institution with the Analysis of Simulation on Using Value Stream Mapping

Value stream mapping is an important tool used in process improvement in many industries. In this study, the error records opened by the end-users to the developers who developed the screens over the software development process in the Information Technologies (IT) group of a financial institution operating in the field of participation banking were examined. This paper has been addressed in order to reduce the operational risks that may arise during the resolution of the error records encountered during the use of the software. In financial institutions, customer satisfaction is closely related to the continuity of operational processes in financial transactions. First, the authors draw the current value stream map base on the approval and solution process adventure of these error records were handled in the processing logic, analyzed and a value stream map was drawn for the current situation. Then, based on the information obtained from the current situation, approval flow of the error records is simulated with the Arena simulation program. The obtained simulation results were discussed with the stakeholders of the error resolution process. Bottleneck activities have been identified through the current situation simulation outputs. A new value stream map has been prepared, based on the seven wasteful milestones defined in the lean production philosophy. Finally, the working style of the new situation developed was adapted to the process, remodeled on the Arena software and the new model was analyzed. The simulation results showed that the error/help call records decreased by 79.8% in the in-process return volume.

The measurement and dynamics of financial openness of Chinese economy

Currently there are many literatures examining the linkage between financial openness and other economic factors in emerging economies. Nevertheless, the accuracy of measurement of financial openness is the prerequisite of evaluating its effects. Different scholars usually construct different indicators that capture different facets of financial openness, hence yielding systematically different regression results. Therefore, it is necessary to construct a comprehensive indicator and measure the financial openness in an all-around way. The innovation of this paper lies in the concept of “financial opening facilitation” that is newly put forwarded by the author. This paper constructs a new sub indicator: financial opening facilitation. Different from previous literatures, this paper argues that although some factors are not directly related to financial opening, they can facilitate the operation of financial institutions and support the flow of international capital, so they also play an important role. The author measures the financial openness in terms of financial account openness, financial institutions openness, financial opening facilitation. This brand-new method can be conducive to the further researchers when they examine the relation between financial openness and domestic economy. Furthermore, China's experience of financial opening can give many revelations to other emerging countries.

The measurement and dynamics of financial openness of Chinese economy

Currently there are many literatures examining the linkage between financial openness and other economic factors in emerging economies. Nevertheless, the accuracy of measurement of financial openness is the prerequisite of evaluating its effects. Different scholars usually construct different indicators that capture different facets of financial openness, hence yielding systematically different regression results. Therefore, it is necessary to construct a comprehensive indicator and measure the financial openness in an all-around way. The innovation of this paper lies in the concept of “financial opening facilitation” that is newly put forwarded by the author. This paper constructs a new sub indicator: financial opening facilitation. Different from previous literatures, this paper argues that although some factors are not directly related to financial opening, they can facilitate the operation of financial institutions and support the flow of international capital, so they also play an important role. The author measures the financial openness in terms of financial account openness, financial institutions openness, financial opening facilitation. This brand-new method can be conducive to the further researchers when they examine the relation between financial openness and domestic economy. Furthermore, China's experience of financial opening can give many revelations to other emerging countries.

Analysis of the Influence of Intellectual Capital and Working Capital on Profitability of State-Owned Sharia Commercial Banks

State-owned sharia commercial banks are the highest assets of Islamic banking in Indonesia. As a financial institution operating in a country that operates a dual banking system, it is required to compete with conventional banking. Facing fairly fierce competition, Islamic banking is required to manage all its capital to generate profitability. Both non-physical capital, intellectual capital (intellectual capital), knowledge, and physical capital to operate the company, namely working capital. The purpose of this study was to see the effect of intellectual capital and working capital on the projected profitability of Return on Assets (ROA). The research used descriptive statistical method with analysis tools in panel data regression which was processed using Eviews 10 software. Techniques and data used the method of documentation and literature study and sampling with the purposive sampling method so that the number of samples in this study was 72 samples of State-owned Sharia Commercial Banks with quarterly data for the 2015-2020 period. The results obtained indicate that simultaneously the independent variables, namely Intellectual Capital (X1) and Working Capital (X2), have a significant effect on Return On Assets (ROA). The second independent variable can explain the dependent variable by 54.2%, and the remaining 45.8% is another variable that is not included in the model. The study results partially show that Intellectual Capital (X1) has a positive and significant effect on Return On Assets (ROA). However, the Working Capital variable (X2) does not affect the Return on Assets (ROA) of BUMN Commercial Sharia Banks in 2015-2020.

ECONOMIC SECURITY MANAGEMENT OF FINANCIAL INSTITUTIONS AS OBJECTS OF THE STATE CRITICAL INFRASTRUCTURE

The need to form a system of economic security for the effective operation of financial institutions is determined. Peculiarities of ensuring economic security of different types of financial institutions are found out, characteristic features of functional systems of economic security of financial intermediaries are revealed. It is offered to understand the management of economic security of financial institutions as a direction of management activities aimed at achieving a high level of protection of the institution's resources from the negative impact of internal and external threats by implementing a wide range of management decisions to use available opportunities and resources while providing financial services. The basics of the mechanism of economic security management of financial institutions are formed. It is assumed that the organization of the economic security system of a financial institution is carried out in several stages, such as the formation of the economic security system, ensuring the economic security system, identification, assessment, ranking of threats, and development of countermeasures; assessing the level of readiness of institutions to implement a mechanism for managing economic security; assessment of the level of economic security, development of management decisions. It is determined that the purpose of economic security management is to achieve the maximum possible level of realization of the institution's interests and meet the interests and needs of clients with optimal resource costs to minimize the impact of threats that accompany the activities of institutions.

FINANCIAL INSTITUTIONS OF THE RUSSIAN EMPIRE IN DNIEPER UKRAINE IN THE LAST QUARTER OF THE 18TH – EARLY 20TH CENTURY IN MODERN HISTORIOGRAPHICAL DISCOURSE

The purpose of the research is to attempt a historiographical analysis and systematization of scientific research of modern Ukrainian researchers on the history of creation and operation of financial institutions of the Russian Empire in Dnieper Ukraine in the last quarter of the 18th – early 20th centuries, to find out the state of research of the problem and to determine the prospects of further scientific research. The methodology is based on the principles of historicism and objectivity, along with the integrated use of general scientific methods – analysis, synthesis, abstraction; historiographical – concrete-historiographical analysis and synthesis; and historical – comparative-historical, typological and chronological methods. The scientific novelty is due to the lack of special historiographical works on the problem within the specified chronological limits. The article for the first time systematizes and generalizes the scientific achievements of modern domestic scholars on the study of the history and activities of financial institutions of the Russian Empire in the Ukrainian lands in the last quarter of the 18th – early 20th century. Conclusions. Thus, the research degree analysis of the history of the Russian autocracy’s financial bodies in Dnieper Ukraine in modern Ukrainian science showed the lack of generalizing work on this issue. At the same time, the modern historiography accumulated a lot of research on the history of the creation, evolution and activities of imperial financial institutions in Ukraine. The analysis of modern scientific achievements allows us to assert the formation of scientific schools on the history of economic and financial policy – Kyiv Historical School of the Corresponding Member of the NAS of Ukraine O. Reient; Kharkiv Historical and Legal School of prof. O. Holovko; Kropyvnytskyi School of Economic History of prof. V. Orlyk.Among the promising aspects of the problem for further research, in our opinion, there are: the daily life of local financial officials, their participation and role in social and cultural processes in Ukraine, relations between society and financial institutions, study of history and activities of financial authorities in the context of institutions, the use of the anthropological approach to the study of bureaucracy by the scientists.