Sudanese Banks Research Articles

The The Impact of Liquidity, Credit, and Financial Leverage Risks on Financial Performance of Islamic Banks: A Case of Sudanese Banking Sector

This study aims to investigate the impact of liquidity, credit, and financial leverage risks on the financial performance of Islam banks in Sudan during the period of 2008 - 2018. Panel dataset of 143 observations from (13) banks has been used in this study. Two models of ROA and NPM have been constructed using robust random effects estimates for testing the study hypotheses. The independent variables consist of liquidity and credit risks plus the financial Leverage ratio. Credit risk that measured by nonperformance of loan (financing) and provision of loan (financing) loss ratios; while the liquidity risk measured by cash to deposits ratio, liquid assets to total assets ratio and total loan (financing) to total deposits ratio. The financial performance of Islamic banks in Sudan measured by the ratios of return on assets and net profit margin. The results reveal that the credit risk and financial leverage have significant and negative impact on the financial performance of Islamic banks in Sudan, whereas the liquidity risk generally found to be insignificant. Despite that, the liquidity risk in term of liquid assets to total assets ratio provides a significant and positive influence on the financial performance of Sudanese banks. Finally, the importance of this study is that it touches the most significant types of risks that Sudanese Islamic banks face during their operational cycles.

Impact of Risk Management Efficiency on Providing Banking Credit: A Field Study on Sudanese Banks

Impact of Risk Management Efficiency on Providing Banking Credit: A Field Study on Sudanese Banks

The role of continuous auditing in limiting creative accounting practices - A field study on a sample of Sudanese banks -: دور المراجعة المستمرة في الحد من ممارسات المحاسبة الإبداعية - دراسة ميدانية على عينة من المصارف السودانية –

This study dealt with the role of continuous review in limiting creative accounting practices (a field study on a sample of Sudanese banks). The problem of the study is: there are many alternatives to measurement and accounting evaluation that may be used to influence financial data to achieve creative accounting goals, which may affect the interests of some Categories associated with the company. The importance of the study lies in activating the role of continuous review and limiting creative accounting practices in manipulating the list of financial position and income in Sudanese banks. The study followed the descriptive approach, the analytical approach and the case study method, with the use of the (SPSS) program to analyze the data collected by the questionnaire tool from the number (100) random sample from the study population. The study concluded that the continuous verification of the appropriateness of accounting measurement in financial transactions limits the effects of creative accounting in the statement of financial position. Continuous verification of the adequacy of accounting estimates for some financial elements limits the effects of creative accounting on financial statements. The study recommended continuous verification of the appropriateness of accounting measurement in financial transactions limiting the effects of creative accounting in the statement of financial position.

Banks’ Profitability in an Islamized Financial System: Comparative Study between Iran and Sudan

The main objective of this paper is to explore and compare the drives of banks’ profitability in Iran and Sudan as both countries Islamized their financial systems, and according to the best of my knowledge is the first paper to compare banks’ profitability on the only two Islamized financial systems in the world, Iran and Sudan. This study employs panel data techniques specifically one-way fixed effect model, data obtained from Bank scope database, to address this paper title for the period 1992-2008. The descriptive statistics results show that Iranian banks are more profitable and have higher loan to total asset ratio in comparison to Sudanese banks. Contrary, Sudanese banks are more liquid; more capitalized and have higher reserves. The regression analysis reported that capital adequacy (positive), loan intensity (negative), management efficiency (negative), lagged GDP growth (positive) and real interest rate (positive) had the same significant effect on banks’ profitability in Iran and Sudan. Meanwhile, liquidity albeit had the same positive effect on banks’ profitability in Iran and Sudan the results were significant in case of Iran. On the other hand, size, credit risk and industry concentration had opposite effect on banks in Iran and Sudan. The effect of size was negative for Iranian banks and positive and insignificant for Sudanese banks. Also, credit risk was negative and significant for Iranian banks and positive for Sudanese banks (insignificant). The same applies for industry concentration as the variable impacted Iranian banks negatively (significant) and Sudanese banks positively (significant).

Corporate governance, SSB strength and the use of internal audit function by Islamic banks

PurposeThis paper aims to identify the effects of some corporate governance (CG) mechanisms and Shariah Supervisory Board (SSB) strength on the voluntary use of internal audit function (IAF) by Islamic banks in Sudan.Design/methodology/approachBased on Agency and Stakeholder Theories, this paper hypothesizes that IAF is likely used by Islamic banks with strong CG and Shariah governance systems. To test these hypotheses, we examine the annual reports of 14 Sudanese banks for a period of five years following the global financial crisis in 2008, using logistic regression analysis.FindingsThis paper found that IAF is likely used by Islamic banks with higher CG disclosure (CGD) and strong SSB. While the findings showed that the audit committee and IAF are likely used as substitutes, this paper also indicated that there is a negative association between levels of Unrestricted Investment Account Holders’ (UIAH) ownership and the use of IAF. However, the evidence of this study did not find any impact for the board of directors’ strength on the use of IAF.Research limitations/implicationsThere may be better measures for some variables in the study model. Additionally, the restriction of the study sample to Sudanese banks may limit the generalization of the results. Therefore, future studies may refine the model and expand the sample to Islamic banks in other countries.Practical implicationsThis paper highlights the importance of IAF for Shariah governance in Islamic banks. Moreover, the insignificant association between the use of IAF and the strength of board of directors has important implications for the board’s effectiveness in Islamic banks.Originality/valueThis is the first study to investigate the factors associated with the use of IAF by Islamic banks.

Role of Competitive Strategies in Achieving a Competitive Advantage in the Sudanese Banks

Role of Competitive Strategies in Achieving a Competitive Advantage in the Sudanese Banks

The Impact of Liquidity, Credit, Financial Leverage Risks on Financial Performance of Islamic Banks: The Case of Sudanese Banking Sector

This study empirically investigates the impact of liquidity and credit risks plus financial leverage on the financial performance of Islam banks in Sudan during the period from 2008 to 2018. The study uses panel dataset of (143) observations from (13) Islamic banks. Two models of ROA and NPM have been constructed using robust random effects (GLS) estimates for testing the study hypotheses. The independent variables consist of credit risk that measured by non-performance of loans (financing) and provision of loans (financing) loss ratios; and the liquidity risk is measured by three ratios that include cash to total deposits, liquid assets to total assets and total loans (financing) to total deposits; plus, the financial leverage ratio. The financial performance of Islamic banks in Sudan is measured by the ratios of return on assets and net profit margin. The results reveal that the credit risk and financial leverage have a significant and negative impact on the financial performance of Islamic banks in Sudan, whereas the liquidity risk generally found to be insignificant. However, the liquidity risk in term of liquid assets to total assets ratio provides a significant and positive influence on the financial performance of Sudanese banks. The importance of this study is that it touches the most significant financial risks that Sudanese Islamic banks face during their operational and long-term cycles. Moreover, the study can provide insights to policy and decision makers in banking sector in Sudan toward managing aforementioned risks.

Banking Governance Mechanisms and their Role in Attracting Investment: A Case Study of a Sample of Banks Listed on the Khartoum Stock Exchange

The study aimed at identifying the role of banking corporate governance mechanisms in attracting investments to Sudanese banks, so it followed the descriptive method to realize the objectives of this study, depending on the oriented questionnaire of banks sampling registered in the Khartoum stock market. The study reached some important results such as the banking corporate governance mechanisms application led to attracting foreign direct investments and local capital encouragement of investment in various projects, international and local cash flow guarantee. The study concluded with some recommendations such as the Sudanese banks should concern over the banking corporate governance mechanisms that have an effective impact on attracting investments to be traced.

Evaluate the effectiveness of internal control systems and their role in providing an effective governance framework in Sudanese banks

هدفت البحث إلى معرفة العلاقة بين أبعاد نظم الرقابة الداخلية وتوافر إطار فعال للحوكمة بالمصارف السودانية، استعمل البحث المنهج الوصفي والتحليلي لجمع بيانات الدراسة وتحليلها باستخدام برنامج الحزم الإحصائية للعلوم الإجتماعية (SPSS) وتم استعمال الاستبانة كأداة من أدوات التحليل، وتم جمع (120) استبانة على العينة المستهدفة من العاملين بالمصارف السودانية، توصلت الدراسة إلى عدة نتائج منها، أن المصرف يتجنب الأساليب التي تؤدي الى الاستخدام غير الرشيد للموارد المتاحة، ويقوم بتحديد وفصل المهام بين العاملين، بالإضافة إلى الاستجابة السريعة للتقارير التي تبين وجود مخالفات ، وأن المصرف يراعي الفحص والتصميم الجيد للمستندات الأصلية التي يعتمد عليها للتحقق من عدم وجود أخطاء بها ، وخلصت الدراسة إلى عدة توصيات منها، ضرورة وجود لائحة للمصارف تتميز بالمرونة الكافية وتتوافق مع احتياجات الزبائن، بالإضافة إلى وجود أسس لمتابعة ومحاسبة العاملين بالمصارف.

English

The purpose of this study is to identify the key determinant of the bank selection decision by Sudanese banks’ customers. The motivation for this paper is the lack of research that empirically studied bank selection criteria that influence customers' selection decisions on banking services in Sudan. Data were collected using self-administered questionnaires to a sample of 253 of Banks customers in Khartoum State. Their responses on the importance of 22 different selection criteria were rated and analyzed. Mean analysis and exploratory factor analysis is applied to rank the most important determinants of bank selection. The main results concluded that Corporal Efficiency is the most important determinant that has influenced the customer's selection decision. Other factors perceived to be important include bank marketing efforts, convenience and service delivery. Research on determinant factors of consumers’ bank selection decision is scarce in Sudan. This study contributes in that direction.   Key words: Selection criteria, banking industry, consumer behavior, Sudan.

Determinant Factors of Consumers’ Bank Selection Decision in Sudan

The purpose of this study is to identify the key determinant of the bank selection decision by Sudanese banks’ customers. The motivation for this paper is the lack of research that empirically studied bank selection criteria that influence customers' selection decisions on banking services in Sudan. Data were collected using self-administered questionnaires to a sample of 253 of Banks customers in Khartoum State. Their responses on the importance of 22 different selection criteria were rated and analyzed. Mean analysis and exploratory factor analysis is applied to rank the most important determinants of bank selection. The main results concluded that Corporal Efficiency is the most important determinant that has influenced the customer's selection decision. Other factors perceived to be important include bank marketing efforts, convenience and service delivery. Research on determinant factors of consumers’ bank selection decision is scarce in Sudan. This study contributes in that direction.

Issues in Existing Agricultural Credit and Scope of Bay‘ al-Salam as an Alternative

This study focuses on issues in agricultural finance in Pakistan and suggests the use of bay‘ al-Salam, the forward contract as allowed in Islamic law of contracts. Despite vital importance, the agriculture sector in Pakistan hasn’t been able to make the case to gain attention on the Government’s priority list. A number of negatively impacting elements can be pointed out, but the standalone interest based system of agricultural credit can be termed as the most harmful for farmers, agriculture sector and the national economy. Major problems include insufficient institutional credit, exorbitant rate of interest, non-availability of collateral and the cumbersome procedures. This situation creates a credit gap which is filled by the non-institutional sources like middlemen, shopkeepers and money lenders who too exploit the poor farmers. However, they still borrow from private sources as the access is easier. The concerns are growing about the existing interest based credit system and voices are also raised for an alternative system that is easy to access as also compliant with the Shar¯ı‘ah principles. Salam financing for the purchase of crops initiated by Sudanese banks couldn’t create desired impact fully. Similarly, Salam financing offered by First Islamic Bank of Indonesia faced serious Shar¯ı‘ah compliance issues. However, a private body namely Wasil Foundation’s bay‘ al-Salam initiative in Pakistan seems comparatively a successful story. A relatively better response and wider acceptance by the stakeholders to Salam financing offered by Wasil indicates that banks (both conventional and Islamic) cannot apply Salam efficiently due to non-availability of required infrastructure. Although Salam financing is highly instrumental mode of finance for agriculture, but could fail if managed through the Islamic banks in obtaining the desired outcome. This study, based on the literature and expert opinion collected through a survey, proposes a separate body to handle Salam financing to agriculture in Pakistan.

The impact of the components of the accounting information system on the protection of e-commerce operations of banks operating in Sudan: أثر مكونات نظام المعلومات المحاسبي على حماية عمليات التجارة الإلكترونية للمصارف العاملة بالسودان

This study aimed to explain the impact of accounting information system components on the commercial banks in Sudan - to protect e- commerce operations. To achieve this objective, the analytical descriptive approach of the selected study sample has dependable, the respondents are employees of the Departments of Technology and financial management in Sudanese Banks, the problem of study is the difficulties facing accounting information systems under the use of e- commerce, and the procedures to be taken to protect e- commerce operations. The results of the study showed that, the accounting information system components is effective to protect e- commerce operations in the commercial banks in Sudan, beside the provision of an effective system of accounting for costs and financial accounting helps control the electronic activities of banks. Based on the findings, the study recommends that, the necessity of verifying the validity of the data during the entering of the accounting information system, also the auditor's report should not be to traditional and formal aspects only, nearby the attention to the requirements of electronic commerce as required by the environmental and professional renewable conditions of the profession of accounting and auditing, besides the validate and authenticity website of the Banks.

The impact of the banking mergers on the banks performance in Sudan: الاندماج المصرفي وأثره على الأداء المالي للمصارف في السودان

The purpose of this empirical study was to highlight the impact of the banking mergers on the banks performance in Sudan. Mergers aimed y to create Strong financial institutions that are able to compete domestically and internationally. The main problematic of this research is to measure the degree of success of the merger of Sudanese banks. especially، to assess the experience between farmers bank and attijare bank. Our hypotheses are bank capital، profits and deposits، increase after merger. We used the an analytical approach and descriptive approach. The results show that there is a very significant increase of the capital after the merger and in the same time profits and deposits increased.

The Impact of Electronic Banking Services on Customer Satisfaction in the Sudanese Banking Sector

This research paper aims to study the impact of electronic banking services on customer satisfaction at Sudanese banks. Questionnaires were designed by the researchers. Data and information have been collected and analyzed from the internet users in the Sudanese banks clients. The study found that there are statistical significant differences of electronic services provided by the Sudanese banks on customer satisfaction. The study attempted to explain the various means of electronic banking services which might lead to the customer satisfaction.This paper showed that the banking services over the internet has a positive impact on customer satisfaction. This study recommended that the bank management should focus on spreading the knowledge of the electronic banking services to the customers. This study emphasized the importance of the electronic banking services and recommended that the bank management should spread the technological awareness among current and prospective customers, and develop suitable infrastructure for electronic banking services in the Sudanese banking sector.

الرقابة الداخلية وأثرها على جودة التقارير المالية المنشورة

The Problem of Studying in some Banks in Sudan was not Concerned with the Internal Control which results in Negative Effects that Affect the Quality of the Published Financial Reports which depend on decision making and users.The Extent of the Success of the Sudanese Banks in Applying the Verification of the Validity and Integrity of Internal Accounting Opeations.The Descriptive, method was Adopted .The Stude Reached Conclusions, Including the Failure to Evaluate the Objective Plans and Policies Adopted by the Sudanese Banks,Failure to Verife and Integrity of Accounting Operation in the Sudanese Banks, The Study Recommended that Sudancese Banks, Should Activate the Register of Assets and modernize the System, The Internal Audit of the Sudanese Banks should be followed Periodically by the item, Including the materials entered,Produced and Scrap, Work on monitoring the Protection of Comuter Systems from malicious viruses Across different Networks.

The profitability of Islamic banking in Sudan

We investigate the possible profitability determinants by employing the dataset comprised by 27 Sudanese banks from 2005 and 2013. Our contribution to the literature is that we examine the following three models of finance specific to Islamic banking performance: (a) Profit and Loss Sharing, (b) Non-profit and Loss Sharing and (c) Salam mode of finance. We find that ownership, capitalisation and asset utilisation have a positive impact on return on assets (ROA) while operation efficiency, bank age, leverage and specialisation bring an adverse impact. Our empirical evidence also indicates that the Profit and Loss Sharing mode of finance (PLS), one of the financial products provided by Islamic banking only, brings a positive impact on both financial performance indicators: return on assets (ROA) and return on equity (ROE).

محاسبة القيمة العادلة وأثرها في كفاءة الأداء المالي للمصارف السودانية دراسة ميدانية

This research problem is represented in the fact that, notwithstanding, the unique characteristics of the fair value accounting, proved by the international experiences of the utilization of this trend; numerous Sudanese banks have no interest in the fair value accounting in order to measure its assets and liabilities and disclose the same in banks' financial reports. In this regard, some research studies have proved the lack of conformity of the accounting measurement according to the historical cost under high inflation rates, taking into account the existence of high inflation rates in the Sudan, which may affect the financial performance of banks. To put said facts into effect the research problem has been put forward in the following research questions: What is the effect of the fair value accounting on the financial performance efficiency of the Sudanese banks? Doesaccounting measurement according to the basis of the fair value accounting, affect the financial performance efficiency of the Sudanese banks? Does accounting disclosure according to the basis of the fair value accounting, affect the financial performance efficiency of the Sudanese banks? The research aimed to analyze the effect of application of the fair value accounting on the financial performance efficiency of the Sudanese banks, by introducing the unique characteristics of the fair value accounting and its significance and to clarify the effect of accounting measurement and disclosure according to the basis of the fair value on the financial performance efficiency of the Sudanese banks. The research employed the analytical descriptive approach to effect the analysis of the 100 questionnaire forms, distributed to the research community, using the statistical package for the social sciences (SPSS) to analyze the data in order to know the answers of the respondents towards the questionnaire statements. The research proved the hypotheses and reached a number of research findings, including the following: The Sudanese banks are so interested in the fair value accounting in measuring and disclosing its assets and liabilities in the financial reports. Accounting measurement and disclosure according to the fair value accounting, has helped the Sudanese banks improve its financial performance in a sound manner

أثر محاسبـة القيمة العادلـة على سلـوك و إتجاهــات إدارة الاربــاح فى القطـاع المصرفي في السودان

هدفت هذه الدراسة الى بيان أثر محاسبـة القيمة العادلـة على سلوك وإتجاهـات إدارة الأربـاح في القطاع المصرفي من خلال تقييم العلاقة بين إدارة الأرباح والقيمة العادلة فى ظل التحفظ المحاسبي كأحد الاتجاهات المحاسبية المعاصرة . ولتحقيق هدف الدراسة فقد تم إتباع المنهج النوعي والمنهج الوصفي في تحليل النتائج التي تم إستقاء بياناتها عن طريق الإستبانه فى عينة من المصارف السودانية التى شكلت مجتمع الدراسة، وتمَّ اختيار مفردات عينة الدراسة بطريقة العينة (القصدية) للحصول على أراء ومعلومات معينة ، وقد تم توزيع عدد (80) استمارة على العينة المستهدفة. توصلت الدراسة إلى عدة نتائج كان أهمها أن إستخدام تقديرات القيمة العادلة في القياس والإفصاح المحاسبي يوفر أسلوب أكثر موضوعية وواقعية لأداء الوحدات الاقتصادية ، وأن مرونة تطبيق المبادئ المحاسبية ووجود البدائل المتعددة للسياسات المحاسبية يعد سبب كبير في وجود إدارة الأرباح ، وإن إستخدام تقديرات القيمة العادلة تؤثر على إدارة الأرباح وتعمل على الحد منها عند إستخدام سياسة التحفظ المحاسبي وتحد من دوافع الإدارة الانتهازية لتحقيق دوافعهم الذاتية.

An Empirical Investigation of the Impact of Technological Factors on Computer – Based Information Systems (CBIS) Usage by Managers in Banking Sector in Sudan

<p>Computers are becoming more available in Sudanese banks with more sophisticated software and advanced information systems. But factors that might affect acceptance and utilization of these systems by managers need to be examined. This paper seeks to assess the influence of technological factors on computer-based information systems usage by managers in Sudanese banks with reference to the Technology Acceptance Model (TAM). A questionnaire was distributed to a sample of 120 randomly selected middle level managers from different banks in Khartoum State and Gezira State in Sudan. Linear and multiple regression analysis and χ 2 (chi – square) tests were conducted to determine the relationship between the dependent research variable (computer- based information system usage) and the independent research variables (perceived ease of use, perceived usefulness, manager involvement in system design and implementation, and availability of technical support). Findings of this study suggest that the perceived ease of using the system (PEOU) and the perceived usefulness of the system (PU) have significant influence on the computer- based information system usage by banks’ managers. The empirical evidence also proved that the perceived ease of use and the perceived usefulness were fully mediating the influence of the technological factors (manager involvement in system design and implementation and technical support). The academic and practical implications of the study were discussed and suggestions for future research was presented.</p>