Public Banks Research Articles

Managerial insight on triple bottom line reporting – an analysis of the Indian banking sector

Purpose Reporting on triple bottom line (TBL) practices has emerged as an essential aspect in banking sector due to evolving social and environmental concerns. Engaging in social and environmental activities is a strategic means to uphold dynamic alliances with stakeholders and eventually attain sustainable development. Furthermore, perception towards social and environmental practices is strategic to satisfy stakeholders’ interests. This paper aims to examine managers’ perception about reporting on social-environmental performance and its impact on financial performance (FP) in Indian banking sector. Research further assesses moderating effect of gender and experience in influencing the relationship between the constructs and also determines importance and performance of the constructs. Design/methodology/approach A well-structured questionnaire was distributed to 400 bank managers across India’s public, private, regional-rural, foreign and cooperative banks. The collected data were analysed through Smart PLS structural equation modelling. The moderating effect of demographics of bank managers in influencing the relationship was assessed using PLS-multi-group analysis (MGA). Besides, importance performance map analysis (IPMA) was used to understand the importance and performance of the constructs. Findings Findings indicate that bank managers believe that social and environmental activities strengthen relations between banks and stakeholders, resulting in better FP, thereby endorsing the stakeholder theory. Results of MGA suggest that gender and experience of bank managers are not effectual moderators in determining relationship between the constructs. Using IPMA, findings advocate that managers perceive environmental performance as a relatively high performance and a more important construct in influencing FP than social performance. Social implications Research would pave the way for banks to effectively communicate their commitment to sustainable development goals, engage stakeholders and demonstrate their commitment to creating positive social and environmental impacts. Furthermore, managerial perceptions can have a marked effect on customers’ understanding of social and environmental practices. This may influence customer satisfaction, conviction, commitment and constancy. Besides, a better understanding of the performance on social and environmental aspects over and above the FP of banks would facilitate the investors to make more informed and effectual decisions. Originality/value Considering the paucity of studies on the managerial perception of social and environmental activities and determining how the perception affects financial success, this study makes significant contribution to the literature. It would facilitate banks to design appropriate strategies and legislations to incorporate reporting on TBL practices for improved performance analysis. This would eventually ensure profitability along with sustainability in the Indian banking sector.

Pengaruh Kredit Macet, Tingkat Efisiensi dan Likuiditas Terhadap Profitabilitas: Studi pada Perbankan Umum Konvensional yang Terdaftar di Bursa Efek Indonesia Periode 2020-2022

The purpose of this study was to determine how the influence of Bad Debt, Efficiency Level and Liquidity on Profitability both partially and simultaneously. The data used in this study are secondary data in the form of financial statement data on conventional public banking companies listed on the Indonesia Stock Exchange for the period 2020-2022. The research methods used are descriptive and associative methods with a quantitative approach. The sampling technique used in this study used a non-probability sampling approach with purposive sampling method. The data analysis techniques used are multiple correlation coefficient test, coefficient of determination, multiple linear regression test, partial test (t test) and simultaneous test (f test). Based on the results of the study, it shows that from the partial test (t test) Bad Credit (NPL) shows a result of 0.294 where tcount 1.065 < t table 2.024 with a significance value of 0.294, then the Efficiency Level shows a result of 0.000 where tcount 22.440 < t table 2.024 with a significance value of 0. 000, then Liquidity shows a result of 0.002 where tcount 3.396 < ttable 2.024 with a significance value of 0.002. the conclusion is that Bad Debt partially has no effect on Profitability while the Efficiency Level, Liquidity partially has an effect on Profitability.

A BRIEF ANALYSIS OF THE BANKING INDUSTRY IN INDIA

This research paper explores the evolution and current dynamics of the Indian banking sector, focusing on the role of digital transformation and the performance of public, private, and foreign banks. Focusing mainly on the decadal data from 2013 to 2023, the study analyzes the growth of bank assets, the Credit-Deposit (C-D) ratio, and the penetration rate of online banking. The findings demonstrate that the banking sector in India has undergone significant changes, with technological advancements driving increased efficiency and customer reach. Public sector banks faced challenges due to non-performing assets (NPAs), while private sector banks showed robust asset growth, recovering quickly from the economic impact of the COVID-19 pandemic. Foreign banks also displayed resilience, with steady growth in assets. The research highlights the critical role of digital banking in modern banking services, contributing to financial inclusion and economic growth. KEY WORDS: public, private, foreign, assets, Credit-Deposit ratio, online banking

A comparative study on the impact of service quality on customer satisfaction: Survey of joint venture and government banks in Nepal

This study explores the relationship between customer satisfaction and service quality, of the inquiry is the evaluation of client satisfaction regarding the caliber of service rendered by Nepalese commercial banks. The study attempts to determine the effect of focusing on how important it is for service quality to influence customer contentment. The primary focus service quality on customer satisfaction within the Nepalese banking industry is by using descriptive and causal comparative research techniques. A total of 383 samples were taken from six joint venture banks and three public (or Government ownership) banks in Nepal. Using primary data obtained from a survey with a five-point Likert scale, correlation and regression analysis are used in the study to examine the impact of several service quality parameters on customer satisfaction. The results show that, in the Nepalese banking industry, responsiveness, reliability, assurance, and empathy have a positive and significant association with customer satisfaction. However, responsiveness does not significantly affect customer satisfaction.

An Evaluation of Assets Quality of Selected Public and Private Sector Banks in India

The banks performance within a nation needs to be thoroughly assessed, as it plays a crucial role in influencing the country's economic health. This study aims to analyse and evaluate the asset quality of sample Indian public and private sector banks over a ten-year period, from the year 2013-14 to 2023. Banks were chosen based on their market capitalization and net profit, including major public sector banks such as SBI, BOB, and PNB, alongside leading private sector banks like HDFC, ICICI, and KOTAK Bank. The financial performance analysis employs the CAMEL rating model, focusing on the acronym "E." The CAMEL model parameters include Capital Adequacy Ratios (C), Asset Quality Ratios (A), Management Efficiency Ratios (M), Earnings Quality Ratios (E), and Liquidity Ratios (L). The results are analyzed using descriptive statistics. Data for this study were gathered from bank websites, and the CAMEL Model Asset Quality Ratios were applied after processing and organizing this information. Hypothesis testing involved calculations using simple averages and One-way ANOVA. The analysis of the data indicated that private banks excelled in all the ratios of the Asset Quality Parameter than the public banks. Hypothesis testing showed that there is no significant difference between the performance of public and private sector banks when it comes to the asset quality parameter.

A comparative study on the efficiency of the public and private sector banks post-merger: A Data Envelopment Analysis

The paper compares the operation efficiency of the public service banks against the private service banks post-merger. The paper also makes an attempt to rank the individual banks in the years before and after mergers. Hence, the study taken a period of five years from 2017 to 2022. The researchers employed the data envelopment analysis (DEA) methodology to calculate the efficiency. From this viewpoint, the merger of the public service banks enhanced their performance but still lagged behind the private sector banks.

A HOLISTIC APPROACH TO THE BANKING SECTOR: PERFORMANCE AND EFFICIENCY ANALYSIS OF TURKISH BANKS USING CoCoSo AND DEA METHODS

The banking sector is a vital component of global economies, playing a critical role in ensuring financial stability by gathering savings, providing credit, and facilitating various financial transactions. Banks not only support economic growth but also act as intermediaries between surplus and deficit units within the economy. Therefore, evaluating their financial performance and efficiency is crucial for understanding the overall health of the financial system. This study analyzes the financial performance and efficiency of the top 10 banks in Turkey, which are ranked by asset size, over a 10-year period from 2013 to 2022. Using the Combined Compromise Solution (CoCoSo) method, the study ranks these banks based on various financial criteria, such as capital adequacy, asset quality, liquidity, and profitability. CoCoSo is a multi-criteria decision-making method that allows for comprehensive performance analysis by considering multiple factors simultaneously. In addition to CoCoSo, Data Envelopment Analysis (DEA) is used to evaluate the efficiency of these banks in utilizing their resources to generate financial outputs. The study’s findings reveal that privatelyowned banks, particularly Akbank T.A.Ş., consistently rank at the top in terms of both financial performance and efficiency. Akbank’s strong performance is attributed to its effective resource utilization and strategic management decisions. State-owned banks, on the other hand, generally show lower financial performance, even though they exhibit high efficiency levels. This discrepancy suggests that public banks may be focusing on non-profit-driven projects that contribute to public welfare, which in turn affects their overall financial performance. Foreign-owned banks, such as Garanti Bankası and Denizbank, also demonstrate strong financial performance but show varying degrees of efficiency, with Denizbank being relatively less efficient in resource utilization. By employing both the CoCoSo and DEA methods, this study offers a unique dual-method approach that provides a comprehensive evaluation of the Turkish banking sector. The combination of these two methods allows for a more nuanced understanding of both financial performance and efficiency, offering valuable insights for policymakers, bank management, and researchers. The study not only highlights the strengths and weaknesses of individual banks but also underscores the importance of efficient resource management for sustaining competitive advantage in a highly dynamic banking environment. The results of this study can serve as a robust framework for future research on bank performance evaluation, especially in emerging markets. Moreover, the study’s methodology can be applied to other sectors or countries to provide cross-sectional and time-series analysis, contributing to the broader literature on financial performance and efficiency.

Sector and employee withdrawal behavior: evidence from licensed public and private sector commercial bank staff of Sri Lanka

Employee well-being and organizational effectiveness are seriously threatened by withdrawal behavior in the ever-changing business environment. This study explores the complex link between the banking sector (public and private) and employees' withdrawal behavior. Further, which sector of banking staff has more withdrawal behavior is investigated in this study. Regression modeling and quantitative analysis are used in this study to provide persuasive insights into how the sector affects physical and psychological withdrawal behavior (WBP and WBS). Primary data is used in this study, collected through a Likert scale questionnaire from 131 banking staff. The results show a significant and positive relationship between sector and withdrawal behavior. Moreover, the results confirm that private-sector banking staff show higher levels of WBP and WBS than the public sector. Results of the study suggest that both sectors' top management ought to consider some strategic human resource management practices to retain their employees, especially private licensed banks must consider more impressive supervision and motivation strategies to reduce employee turnover because private sector banking staff have a higher level of withdrawal behavior than public sector banking staff.

Liquidity Risk Management and Profitability in Egyptian Banking: A Comparative Study of Public and Private Banks

Liquidity Risk Management and Profitability in Egyptian Banking: A Comparative Study of Public and Private Banks

Investigating Age as a Moderator of the Relationship Between Glass Ceiling Beliefs and Career Advancement Satisfaction Among Female Managers in Egyptian Public Banks

Investigating Age as a Moderator of the Relationship Between Glass Ceiling Beliefs and Career Advancement Satisfaction Among Female Managers in Egyptian Public Banks

COMPARATIVE ANALYSIS OF SERVICE QUALITY IN PUBLIC SECTOR BANKS AND INDIA POST’S FINANCIAL SERVICES USING SERVQUAL MODEL

Financial services which often involve sensitive transaction such as savings, insurance, loans and investments need to be high in service quality to build trust and credibility among customer. In financial transactions customers need to feel secure that their investments are managed with care and expertise. Service quality of financial services plays a fundamental role to the functioning of modern economies. The present study compares the service quality of Public Banks and India Post Office Financial Services using the SERVQUAL model which assesses five dimensions of service quality: tangibles, reliability, responsiveness, assurance and empathy. The present study employs a cross-sectional survey approach with data collected from 200 respondents through a structured questionnaire. The findings of the study reveal significant differences in service quality perceptions between the public banks and India Post’s financial services. Public Banks are perceived to offer better tangibles and higher levels of empathy compared to India Post which indicates superior physical facilities and more personalized customer services by public banks. However no significant difference in reliability, responsiveness and assurance between the two service providers is found. The study finds a significant positive relationship between service quality dimensions and overall customer satisfaction which highlights the importance of tangibles and empathy dimension in enhancing customer satisfaction. The research intends to shed light on the differences in service quality of public banks and India post. The recommendations based on the study result will help both the service providers to understand customer priorities and enhance their satisfaction.

The role of diversification in stabilizing bank credit over the business cycle

AbstractWe investigate whether diversification stabilizes bank lending cyclicality on a sample of 25 conventional and 18 Islamic banks from Malaysia spanning 2008 to 2021. Our findings reveal that both bank types are nonlinearly procyclical during economic expansions, with Islamic banks also exhibiting countercyclical behavior during economic contractions. Diversification is positively associated with credit growth in conventional banks and Islamic bank subsidiaries, and it amplifies procyclicality across all Islamic bank types. Conversely, loan concentration stabilizes credit in Islamic banks. These results are robust to an alternative credit measure. Further analyses indicate that public and foreign banks are procyclical during booms and countercyclical during busts. At the same time, diversification heightens procyclicality in private, local, and foreign banks, whereas concentration mitigates it in public and local banks.

BANKING ON GREEN: THE MODERATING ROLE OF BANK TYPE IN GREEN HUMAN RESOURCE MANAGEMENT AND CORPORATE SUSTAINABILITY

This study examines the moderating role of bank type in the relationship between green human resource management and corporate sustainability, based on the AMO (Ability-Motivation-Opportunity) theory. Both quantitative and qualitative methods were adopted in the study. A 5-point Likert-type questionnaire was used to collect data from both public and private banks. The study's sample consisted of participants holding various positions in the banking sector. A total of 151 participants responded to the questionnaire. The survey data were analyzed and interpreted using IBM SPSS Statistics 26.0 and PROCESS Macro (Study 1). To support the quantitative study, content analysis was conducted by coding the sustainability reports of the same banks. The findings suggest that both private and public banks can benefit from implementing GHRM initiatives, albeit with some differences based on their organizational characteristics.

“Impacts of neo-banks on North African migrants’ remittances and financial inclusion”

This study examined remittance trends and financial institution preferences among North African migrants in Europe and assessed neobanks' potential to foster financial inclusion and cost reductions. The main objetive was to explore how neobanks can alleviate economic pressures on North African migrants and help achieve the World Bank Group's goal of reducing remittance costs to 5 % and the UN-SDG target of 3 %. Exploratory in nature, both surveys and interviews were used for data collection. The sample consisted of 64 North African migrants from Morocco, Tunisia, and Algeria (North Africa) residing in France, Spain, and Italy (EU). Key findings revealed that North African migrants had diverse remittance behaviors, with varying frequencies and amounts sent home. Trust in traditional banks remained high due to familiarity, cultural norms, and accessibility issues in rural areas. However, neobanks offered significant cost savings, with potential annual savings ranging from €30 to €134 depending on the monthly remitted amount that ranges between a €100 and a €1000 . Adoption of neobanks was higher among younger, and digitally literate migrants with better access to technology. Barriers to wider adoption of neobanks included limited digital and financial literacy, lack of necessary technology in home countries, and cultural resistance to change. High regulatory and compliance costs for traditional banks also contributed to inflated remittance fees. To address these issues, the paper recommends enhancing market competition, improving access to new payment technologies, encouraging larger remittances through incentives, learning from successful public bank models like France's La Banque Postale, and fostering financial literacy and digital inclusion. Additionally, it suggests building trust and cultural sensitivity, investing in robust cybersecurity measures, and developing offline transaction capabilities to increase accessibility for migrants in remote areas.

Impact of Core Banking Solutions in Public Sector Bank comparison with HDFC Bank

A study has been analysed the “Impact of core banking solutions in public sector bank comparison with HDFC bank.” There is no significant relationship between customers perception towards dimensions of service quality of core banking solutions offered by public sector and private banks. A method was used to random sample was conducted on 2 respondents selected from Bhagalpur district and the primary data was collected from 60 respondents (customers) of core banking solutions, public sector and HDFC banks selected from Bhagalpur district. In order to draw the conclusion, the primary data collected through interview schedule from the customers of core banking, public and sector banks comparison with HDFC bank and analysed with the help of statistical tools. The study reveals the respondents positively view about the core banking services offered by public and HDFC bank respondents positively view about the customers using selected channel of core banking services towards public bank and HDFC bank.

The Effect of the Current Expected Credit Loss Approach on Banks’ Lending during Stress Periods: Evidence from the COVID-19 Recession

ABSTRACT In the wake of the financial crisis, policymakers expressed the concern that the incurred loss model delays loan loss recognition to economic stress periods and thereby exacerbates banks’ lending contraction during these periods. Addressing this concern, the FASB issued Accounting Standards Update 2016-13, which requires large public banks to accrue for loan losses using the current expected credit loss (CECL) approach starting in January 2020. We hypothesize and find that banks that adopted CECL prior to the COVID-19 pandemic increased loan loss provisions and reduced loan growth during the accompanying recession more than other banks. The lending contraction is stronger for adopting banks with low regulatory capital and low loan impairment and is primarily driven by commercial loans. Lastly, we find that counties in which CECL-adopting banks have higher market share experience larger increases in unemployment rates during the recession and slower subsequent recoveries. Data Availability: Data are available from the public sources cited in the text. JEL Classifications: E32; G21; G28; M41; M48.

A non-linear Lasso and explainable LSTM approach for estimating tail risk interconnectedness

ABSTRACT Tail risk inter-connectivity is a significant aspect and a risk indicator that should be focused on. Many of the previous works have shown potential non-linearity in tail risk contagion. With the recent advancements in deep learning, Long-Short Term Memory (LSTM) networks have played an important role in sequential data prediction. We experiment with LASSO-based neural networks and interpretative LSTM model along with other machine learning approaches for investigating tail risk interconnectedness among the public banks of Japan. We also investigate the risk reception from large overseas banks in United States finding that medium-sized banks are more likely to receive international risks. Our studies show that LSTM-based model is an excellent fit for the scenario and total connectedness goes up during an economic crisis. The banks having larger market capitalization are more prone to emission and reception of tail risks. This is accompanied by exhibiting the impact of some major economic distresses on Japanese banking system. These results provide important information to regulators and policy makers.

Exploring customer retention dynamics: A comparative investigation of factors affecting customer retention in the banking sector using mediation-moderation approach

The purpose of this research is to explore the impact of service quality, customer trust, and cultural disparities on customer satisfaction within the banking sector. Additionally, the study examined the mediating effect of customer satisfaction and the moderating effect of financial technology. Data for this investigation were gathered from customers utilizing services offered by public banks in Pakistan and China. The analysis was conducted using the Smart-PLS software, with 281 samples from Pakistan and 312 samples from China being included in the study. Results show that service quality, customer trust, and cultural differences positively affect customer satisfaction in the context of Pakistan and China. Results also reveal that service quality and customer trust have a positive effect on customer retention behavior in China, but customer trust has an insignificant impact on customer retention behavior in Pakistan. Analysis specifies that customer satisfaction positively mediated the relationship between service quality, customer trust, cultural differences, and customer retention behavior in Pakistan and China. More importantly, financial technology moderated the relationship between customer satisfaction and customer retention behavior, but it was insignificant in the context of China and Pakistan. The study seeks to provide significant insights for strategic decision-making and improve customer relationship management techniques in the dynamic field of financial services by including mediating and moderating elements.

Impact of somatic complaints on the mental health of bank sector employees: An empirical study

Somatic complaints refer to bodily symptoms that people encounter that don't have obvious biological origins, such as headaches, digestive issues, and musculoskeletal discomfort. There is a scarcity of research explicitly concentrating on the banking industry, despite prior studies looking at the connection between somatic symptoms and mental health in a variety of professional circumstances. This study explores somatic symptoms' impact on banking sector employees' mental health. The research initiative intends to collect quantitative data through questionnaires using a mixed methods approach to determine the incidence and severity of somatic symptoms experienced by bank personnel. Questionnaires (n=196) were distributed amongst different public and private banks of Southern Punjab. The data was analyzed using a reliability test, linear regression model, and correlation to find the relation between somatic complaints and mental health issues. The results show that there is a positive relationship between somatic complaints and mental health issues, i.e., a person having somatic complaints will also suffer from mental health issues, hence, satisfies the research hypothesis. Moreover, according to the study, greater levels of somatic complaints among workers in the banking industry are correlated with higher levels of stress, anxiety, and depression. The association between somatic symptoms and mental health was also examined with respect to potential moderating factors such as company culture, workload, and job satisfaction. In a nutshell, enhancing an employee's psychological health may benefit their work happiness, productivity, and overall organizational performance.

Bank intermediation efficiency and liquidity risk in Egypt: a two-stage non-parametric analyses

This is a pioneering study that undertakes a comparative analysis assessing the annual intermediation efficiency of public versus private banks in Egypt. Moreover, liquidity risk is a major threat facing banks in their efforts to sustain financial stability. Thus, this study is the first to model the determinants of liquidity risk in public and private banks in Egypt while examining the impact of banks’ intermediation efficiencies on their liquidity risk levels. The study employs advanced nonparametric econometric approaches on a sample of Egyptian public and private banks from 2014 to 2022. The data envelopment analysis is used in estimating banks’ intermediation efficiency scores, while the quantile regression analysis is applied to examine the impact of bank intermediation efficiency on liquidity risk under different liquidity risk quantiles. The findings indicate that public banks show consistent superiority in terms of their financial intermediation efficiency levels compared to private banks. Moreover, the paper findings demonstrate the negative significant relationship between bank intermediation efficiency and liquidity risk while highlighting the higher significant positive impact of intermediation efficiency on reducing the liquidity risk of banks that are characterized by undertaking high liquidity risk levels. Furthermore, contrary to general assumptions, this study’s findings demonstrate that the significance of micro- and macro-level determinants of a bank’s liquidity risk is dependent on its prevailing liquidity risk level. Hence, the positive impact of equity capital, asset concentration, size, and growth in gross domestic product and the negative effect of asset quality on bank liquidity risk vary under banks’ different liquidity risk quantiles.