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International Journal of Finance & Banking Studies (2147-4486), Volume 9, pp 01-10; doi:10.20525/ijfbs.v9i1.526

The main purpose of this study is to investigate if determinants that we selected in our analysis have any effects on inflation rate in Western Balkans Countries[1] by using panel data for the period of 2001-2017, in yearly basis in total of 102 observation. The study used quantitative analysis approach and secondary data by applying the multivariate time series, respectively vector error correction model [VECM]. Multivariate time series was applied to investigate whether the budget deficit and other explanatory variable have any significant impact on inflation rate. The results from our analysis shows that three of four determinates that we used are significant on inflation rate. The model summaries statistics for inflation rate which shows that inflation rate has a moderate correlation with explanatory variables that we used in our model, that explanatory variables explain 45.5 percent of dependent variable and we can conclude that a model is a proper and fit. The results suggest that one percent point increase in budget deficit to GDP ratio is associated with about a 9.34 percent point increase in inflation rate. The overall inference is that the ratios that we selected has a significant influence on the inflation rate in Western Balkans Countries. [1] Western Balkans Countries: Albania, Bosnia & Hercegovina, Kosovo, Montenegro, North Macedonia and Serbia.
Manish Tewari, Pradip Banerjee, Soumen De
International Journal of Finance & Banking Studies (2147-4486), Volume 8, pp 21-40; doi:10.20525/ijfbs.v8i4.551

The object of this study is to explore the effect of cultural distance on both the long run and short run performance of cross border mergers and acquisitions undertaken by Indian acquiring firms. We utilize buy and hold returns (BHAR), cumulative abnormal returns (CAR) and cross-sectional regression analysis in our study. Adopting the traditional Hofstede measure of cultural distance and other pertinent variables, commonly used to measure cultural differences, we document a negative and statistically significant influence of cultural distance on Indian cross-border M&As and corroborate some of other findings reported in prior research. Also, we find that the BHAR is nevertheless higher when the acquisitions are friendly, paid for 100% cash, and the acquiring firm is large, older and belongs to a business group. The inclusion of the variable ‘business group’ along with industry relatedness and acquirer size provides valuable insights into the Indian cross border acquisition landscape, wherein business groups dominate to a great extent.
Nadim Anass Alfouhaili, Frédéric Gautier, Iyad Zaarour
International Journal of Finance & Banking Studies (2147-4486), Volume 9, pp 56-71; doi:10.20525/ijfbs.v9i2.722

This research examined the impact of Basel III capital regulation (BCR) on credit risk (CR) using a sample of 25 commercial banks in Lebanon over the period 2012–2017. BCR is measured using the capital adequacy ratio (CAR) and the common equity tier one ratio (CET1 ratio), CR is measured using net provision for credit losses /total assets. To analyze the data, we constructed a hybrid model based on 3 statistical approaches. First, we modelled the dual impact of BCR and CR using probabilistic inference in the framework of Bayesian Belief Network formalism (BBN). Second, to highlight more about the correlation between BCR and CR, we used Spearman correlation test as a nonparametric approach. Third to study the simultaneous effect of CAR and CET1 ratio on CR we applied multivariate regression analysis. By analyzing the probabilistic inference for the first approach we concluded that there is an effect of BCR on CR especially for the high level of CET1 ratio, but when we investigated more if this effect is significant using the Spearman correlation test and the multivariate regression analysis, we concluded that there is no effect statistically significant of Basel III capital regulation (BCR) on credit risk (CR).
, Mustafa Ozsari, Mustafa Özsarı
International Journal of Finance & Banking Studies (2147-4486), Volume 6, pp 39-50; doi:10.20525/ijfbs.v6i1.643

This study aims to determine the influencing factors of the banks to join corporate social responsibility activities. Within this scope, annual data of 23 deposit banks in Turkey for the periods between 2005 and 2015 was taken into the consideration. In addition to this situation, panel probit model was used in the analysis so as to achieve this objective. According to the results of the analysis, it was determined that there is a negative relationship between CSR activities and nonperforming loans ratio. This situation shows that banks do not prefer to make social responsibility activities in case of higher financial losses. In addition to this situation, it was also identified that there is a positive relationship between return on asset and corporate social responsibility activities of the banks. In other words, it can be understood that Turkish deposit banks, which have higher profitability, joint more CSR activities in comparison with others.
Ridvan Cabukel
International Journal of Finance & Banking Studies (2147-4486), Volume 6; doi:10.20525/ijfbs.v6i1.637

The Turkish government set a policy to become a regional financial center in 2007. This policy involved encouraging international banks to enter Turkey and take a more prominent role in the Turkish banking industry. Since then the progress has been slow to achieve this policy objective. The primary indicator of being a financial center is to have the presence of international banks. Even though there are many representative offices in Turkey, few of them changed their status to subsidiary or branch to this day. On the contrary, some international banks announced that they would downsize their operations. Representative offices have lower investment and compliance cost than that of branches and subsidiaries. Banking regulations in Turkey does not differentiate much by type, operations and size. Also international banks have to comply their head office rules in line with regulators in their home countries. In this article, we focus on the regulatory compliance costs on international banks to open branches and to establish subsidiaries with niche market strategy in Turkey. We argue that regulatory compliance costs play a major role on the reluctance of international banks’ lack of enthusiasm.
Edson Kambeu
International Journal of Finance & Banking Studies (2147-4486), Volume 6, pp 134-140; doi:10.20525/ijfbs.v6i1.663

The objective of this paper is to analyse the significance of a change in dividend payment frequency. We initially argue that a change in dividend payment frequency is significant and relevant in the same manner as a change in dividend policy. We analyse the subject using an event study of Sechaba Holdings, a firm listed on the Botswana Exchange` that decided to change its dividend payment frequency from quarterly to bi-annual payment to examine the subject. We specifically used an event study methodology that analyses the significance of abnormal returns that occurred during the event period. The study revealed that the firm’s decision to change its dividend payment frequency did not significantly affect abnormal returns during the event period. The study therefore contradicted our initial argument that a change in dividend payment frequency is significant and relevant.
Edson Kambeu
International Journal of Finance & Banking Studies (2147-4486), Volume 6, pp 141-148; doi:10.20525/ijfbs.v6i1.662

In this paper we analyse the role of Exchange Traded Funds (ETFs) in the price discovery process of stocks listed at the Botswana Stock Exchange.Using daily returns data covering the period 3 January 2013 to 31 December 2015 for Beta Betta ETF and Domestic Company Indices, we utilize a VECM model to find out whether the Betta Beta ETF is playing a significant role in the price discovery process of stocks listed on the Botswana Stock Exchange. We found the error correction term to be statistically significant thereby confirming that the Beta Betta ETF is playing a significant role in the price discovery of stocks listed on the Botswana Stock Exchange.
Mehmet Fatih Bayramoglu
International Journal of Finance & Banking Studies (2147-4486), Volume 5, pp 15-23; doi:10.20525/ijfbs.v5i6.618

Nowadays, one of the leading factors used in the evaluation of a country’s economic development is energy consumption. Because of economic growth, demand for energy is also increasing. In this study, the emerging European countries’ (the Czech Republic, Poland, Romania, Turkey) and the CIS countries’ (Kazakhstan, Russia, Ukraine, Uzbekistan) electricity consumption has been forecasted for five years period (2015-2019). In the study, GM(1,1) Rolling Model, which is developed in the framework of Grey System Theory is used as a mathematical model for real-time forecasting. The results of the study show that there will not be a significant change in electricity demand in this two area during the 2015-2109 period.
Serhat Yuksel, Sinemis Zengin
International Journal of Finance & Banking Studies (2147-4486), Volume 5, pp 10-29; doi:10.20525/ijfbs.v5i4.568

The aim of this paper is to compare the views of internal controllers/auditors and branch/call center personnel of the banks with respect to the operational risk. Within this scope, we made two different surveys to the personnel in Turkish banks in order to achieve this objective. The first survey was conducted by 310 branch and call center personnel whereas 151 personnel in internal control and audit departments of the banks carried out the second survey. The major finding in this study is that there is a difference in the views of these two groups regarding the evaluation of operational risk. In general, internal controllers/auditors look at the operational risk more negatively than branch/call center personnel. The personnel who control and audit operations in the bank think that operational risk knowledge level of branch/call center personnel is less sufficient, operational risk levels are higher, the controls to avoid this risk are less efficient than branch/call center personnel consider.
Anthony May, Rodney Boehme
International Journal of Finance & Banking Studies (2147-4486), Volume 5, pp 39-63; doi:10.20525/ijfbs.v5i4.593

A nascent literature in finance and accounting on tail risk in individual stock returns concludes that bad news hoarding by corporate managers engenders sudden, extreme crashes in a firm’s stock price when the bad news is eventually made public. This literature finds that firm-specific crash risk is higher among firms with more severe asymmetric information and agency problems. A hitherto disjointed literature spanning the fields of international business, finance, and accounting suggests that geographic dispersion in a firm’s operations, and especially dispersion across different countries, gives rise to organizational complexities and greater costs of monitoring that can exacerbate asymmetric information and agency problems. Motivated by the confluence of arguments and findings from these two strands of literature, this paper examines whether stock price crash risk is higher among multinational firms than domestic firms. Using a large sample of U.S. headquartered firms during 1987-2011, we find robust evidence that multinational firms are significantly more likely to crash than domestic firms. Moreover, we show that the difference in crash risk between multinational and domestic firms is most acute among firms with weaker corporate governance mechanisms, including weaker shareholder rights, less independent boards, and less stable institutional ownership. Our analysis indicates that stronger monitoring from each of these three governance mechanisms significantly attenuates the positive relation between crash risk and multinationality. Our findings are robust to the use of alternative measures of crash risk and to controlling for known determinants of crash risk identified in prior studies. Our study offers new insights that should hold value for scholars and market participants interested in understanding the implications of heighted agency problems that multinational firms are likely to encounter and scholars and market participants interested in developing models that more accurately predict tail risk in the equity returns of individual firms.
Wael Bakhit
International Journal of Finance & Banking Studies (2147-4486), Volume 3; doi:10.20525/.v3i2.184

This paper employs a quarterly time series to determine the timing of structural breaks for interest rates in USA over the last 60 years. The Chow test is used for investigating the non-stationary, where the date of the potential break is assumed to be known. Moreover, we empirically examined the deviation from an assumed interest rate as given in a standard Taylor rule and consequences on financial sectors. The empirical analysis is strengthened by analysing the rule from a historical perspective and look at the effect of setting the interest rate by the central bank on financial imbalances. The empirical evidence indicates that deviation in monetary policy has a potential causal factor in the build up of financial imbalances and the subsequent crisis where macro prudential intervention could have beneficial effect. Thus, our findings tend to support the view, which states that the probable existence of central banks has been one source of global financial crisis since the past decade.
Kathy Estes
International Journal of Finance & Banking Studies (2147-4486), Volume 3; doi:10.20525/.v3i4.190

Many U.S. banks failed or performed poorly during the recent financial crisis. Although the costliest failures were large institutions, the majority of failures were community banks (less than $1 billion in total assets). Community banks, which are considered instrumental in small business lending and employment growth, face different risks and challenges than their larger counterparts, including a lack of economies of scale and scope and exclusion from “too-big-to-fail” status. These challenges, coupled with the recent failures, motivate research into potential strategies managers can use to improve performance. This study examined the relationship between three potential diversification strategies and community bank risk-adjusted performance from 2007 to 2011. Understanding these relationships could improve management’s decision-making, allowing them to choose risk-mitigating strategies during a severe economic downturn. Herfindahl-Hirschman Indexes (HHIs) were calculated as proxies for geographic, activity, and asset diversification. Multiple regression models for each of the five years were used to calculate the impact of diversification variables on risk-adjusted ROA. The results show that diversification in all areas is directly related to performance; however, only the asset diversification relationship is significant. To the extent possible for community banks, diversification may improve risk-adjusted performance.
Nedim Makarevic
International Journal of Finance & Banking Studies (2147-4486), Volume 5, pp 01-15; doi:10.20525/ijfbs.v5i1.51

This study has been completed with a purpose to analyze and compare perceptions of clients of Bosnia and Herzegovina and those of Croatian clients about IT security in online banking, to provide insight into similarities and differences of their view points and to create important set of information for all subjects active in banking industry. Once the survey based on six variables and specific questions assigned to each one of those variables was prepared, results regarding both countries were collected and concluded. Survey was completed in both Bosnia and Herzegovina and Croatia at high response rates. Even 207 respondents replied from Bosnia and Herzegovina, while 203 respondents completed survey from Croatia. Results were analyzed and presented using descriptive statistics. Results indicated that Croatian e-banking users trust to banks when it comes to IT security of online banking much more compared to clients of Bosnia and Herzegovina. It is important to mention that clients of Croatia perceive tangible features as highly significant while Bosnian clients do not perceive tangible features that much important. This proved that Croatian clients are aware of potential security threats and they know their part of responsibility when it comes to handling money online. On the other hand, results from Bosnia and Herzegovina indicated that Bosnian clients have lack of trust in online banking, and lack of awareness about personal tangible aspects that can improve security of personal online banking experience. The main limitation of this study is relatively small sample and too generic approach. Therefore, this study may be perceived as a pilot study for future researchers. The study’s results may be of interest to marketers and managers of banks operating in Bosnia and Herzegovina and Croatia to learn more about their clients’ perceptions towards their e-banking services.
Adomola Felix Adefeya, Marshal Tomola Obamuyi, Olawale Femi Kayode, James Ayodele Owoputi
International Journal of Finance & Banking Studies (2147-4486), Volume 4; doi:10.20525/ijfbs.v4i3.225

Bank distress poses threats to financial intermediation process with serious detrimental effect on the economy. Despite all attempts made by the supervisory authorities, the problem appears to defy already established approach and the menace still continues to resurface. Hence, the need to investigate the effects of bank distress on the Nigerian economy. The cointegration and error correction mechanism were used to test the data which covers a period of thirty-one (31) years from 1982 to 2012. The research findings revealed that the ratio of non-performing loans to total loans, and total loans and advances have significant negative effect on economic growth with p-values of 0.0240 and 0.0445 respectively. Also, total bank deposit and cash reserve ratio have significant positive effect on economic growth with p-values of 0.0020 and 0.0374 respectively. The implication of this result is that the Nigerian economy is significantly affected by bank distress. The paper suggests that careful evaluation of loan proposals should always be carried out by banks to determine the viability of the projects and the repayment of the principal sum and its interest ensured to prevent weak asset quality.
Clements Akinsoyinu
International Journal of Finance & Banking Studies (2147-4486), Volume 4, pp 11-24; doi:10.20525/.v4i3.221

The great recession heralded in by the subprime mortgage crisis, took a dramatic turn for worse as a result of collapse of the Lehman Brothers bank in September 2008. The crisis deemed to be the most devastating after the Great Depression of 1929, had a debilitating effect on world economies, developing and advanced alike. The extent of its devastation which is still being felt in Europe and many parts of the globe reminds us the interconnectedness of financial institutions, particularly those tagged TBTF or SIFIs. Policy makers scrambled to curtail the ugly effect of the crisis by rescuing the SIFIs within their jurisdiction largely through bailout mechanism and provision of implicit guarantee for the debts of failing/failed institutions. As soon as the tide is stemmed, they cast their gaze on new crisis resolution and recovery measures that could rein in systemic risks associated with SIFIs, prevent future crises and reduce the concomitant moral hazards in the current resolution measures. The objective of this paper is to assess ex ante the potential impacts of implementing the new Banking recovery and resolution directives on Europe’s TBTF banks.
Samuel Nyambega Nyang'au, Valina Nyamwinuka
International Journal of Finance & Banking Studies (2147-4486), Volume 3, pp 48-59; doi:10.20525/ijfbs.v3i2.183

Many credit schemes in Tanzania channel their funds to women with the objective of alleviating poverty among them. Despite this, majority of women in the country continue to wallow in poverty. The present research was carried out among the Foundation for International Community Assistance’s women credit beneficiaries in Mwanza. The study set out to address the following objectives: to analyze the influence of the husband’s cooperation, relevant training and interest rate on poverty alleviation among women credit beneficiaries in Tanzania taking Foundation for International Community Assistance in Mwanza as a case study. Using simple regression model, results showed that cooperation from the husband as well as relevant training influences poverty alleviation among women credit beneficiaries in Tanzania by 56 and 36 percent respectively. But interest rate was found to have no significant influence at all. The paper recommends that seminars be conducted so that husbands can be taught the importance of cooperating with their wives. Above all giving training to women credit beneficiaries will go a long way in sharpening their business skills. Future researchers should research on laziness and complacency among women credit beneficiaries and the influence on poverty.
Nguyen Thanh Cuong
International Journal of Finance & Banking Studies (2147-4486), Volume 3; doi:10.20525/.v3i3.186

The purpose of this paper is to investigate whether there is an optimal capital structure at which point firm is able to maximize its value. The author employ an advanced panel threshold regression estimation developed in 1999 by Hansen that will indicate whether there are positive and negative impacts of capital structure on firm value. The author has used data of among 90 unlisted Seafood Processing Enterprises in the South Central region of Vietnam (SEASCRs) during 2005–2011 period. The author has used book value of equity plus long- term debt (BVE) and return on equity (ROE) as surrogate for firm value and book value of total debt to total assets (TD/TA) as surrogate for capital structure and as the threshold variable. The empirical results strongly indicate that triple threshold effect exists between debt ratio and firm value when BVE is selected to proxy firm value. However, when ROE is selected to proxy firm value, the result shows that there exists double thresholds effect between debt ratio and firm value. From these results, the author may conclude that the relationship between capital structure and firm value has a nonlinear relationship represents an convex Parapol shape. In addition, the findings suggest implications for SEASCRs on flexible usage of financial leverage. Specifically, SEASCRs should not use loans over 57.39%. To ensure and enhance the firm value, the scope of the optimal debt ratio should be less than 57.39%.
Ali Said
International Journal of Finance & Banking Studies (2147-4486), Volume 4; doi:10.20525/.v4i3.223

The present paper measured the influence of the oil prices on the Islamic banking efficiencies scores during the financial crisis of 2008-2009. The study showed that there is no a direct relationship between the oil prices and the efficiencies scores of Islamic banks in the MENA area. Furthermore, the study demonstrated that Islamic banks in the GCC area showed a higher mean in pure technical efficiency compared to Islamic banks in the North African and other MENA. Islamic banks in other MENA countries and North Africa considered to be technically inefficient. The inefficiencies were due to the underdeveloped banking system and the lack of experiences in those countries to allocate resources between the bank inputs and outputs.
Khalfaoui Hamdi, Moufida Ben Saada
International Journal of Finance & Banking Studies (2147-4486), Volume 4, pp 21-28; doi:10.20525/ijfbs.v4i2.215

This paper aims to identify the determinants of performance of the Tunisian banking sector. The results found, following an empirical study using panel data of Tunisian banks listed on the stock market over the period 2000-2013, show that credit risk, liquidity, total assets and disclosure of information relating to credit are the main determinants of banking performance
Mavhungu Abel Mafukata
International Journal of Finance & Banking Studies (2147-4486), Volume 4; doi:10.20525/.v4i1.203

Since Sub-Saharan Africa's first independence in Ghana, the region has experienced massive and costly political and bureaucratic corruption within public service and administration. The causes of the corruption, its nature and form are wide and intertwined. In Sub-Saharan Africa, efforts to curb corruption have failed to discard it. The paper focused on the period from Nkruma in Ghana to Mutharika the 2nd in Malawi. This paper reviewed existing literature on political and bureaucratic corruption in Sub-Saharan Africa while on the other hand the paper employed key informant interviews to gather the required data to investigate, analyse and profile the genesis and evolution of corruption in Sub-Saharan Africa. The key informant interviews were employed to solicit public views and opinion from nineteen key informant participants (n=19) selected from 11 countries in Sub-Saharan Africa. The paper found that corruption is legendary; has entrenched itself to becoming some sort of culture in the region, and has become the most difficult socio-economic challenge to resolve in the region despite the various anti-corruption efforts employed by stakeholders to curb it. It emerged through the study that law-enforcement efforts against corruption need some reinforcement in order to be effective and eficient in uprooting corruption in the region. If Sub-Saharan Africa fails to address its corruption challenge, its development prospects would seriously curtailed.
Doaa Mohamed Salman, Eyad M. Atya
International Journal of Finance & Banking Studies (2147-4486), Volume 3; doi:10.20525/.v3i1.175

This paper aims to test the validity of the causality between financial development and economic growth on energy consumption in three of North African countries. The study employs error coreection model and Granger causaility test to analyza a dataset for three North African countries covering a period from 1980 to 2010. The applied model is based on demand function for energy to assess the existing of causal relationship of energy with financial development, and economic growth, in Algeria, Egypt, and Tunisia. Empirical results provide a positive significant relating financial development and energy consumption in Algeria, and Tunisia. On the other hand, Egypt’s results show a negative significant relationship relating energy consumption and financial development. The paper is valuable to policy makers in North African countries in their pursuit for achieving economic growth as it clarifies the urge for the financial development reforms to stimulate investment and growth.
, Maya Safira Dewi, Yunita Anwar, Hanggoro Pamungkas
International Journal of Finance & Banking Studies (2147-4486), Volume 3; doi:10.20525/ijfbs.v3i1.170

Tax policy is one of the most important policy in consideration of investment development in certain industry. Research by Newlon (1987), Swenson (1994) and Hines (1996) concluded that tax rate is one of the most important thing considered by investors in a foreign direct investment. One of tax policy could be used to attract foreign direct investment is income tax incentives. The attractiveness of income tax incentives to a foreign direct investment is as much as the attractiveness to a domestic investment (Anwar and Mulyadi, 2012). In this paper, we have conducted a study of income tax incentives in food and agriculture industry; where we conduct a thorough study of income tax incentives and corporate performance in Indonesian and Australian food and agriculture industry. Our research show that there is a significant influence of income tax incentives to corporate performance. Based on our study, we conclude that the significant influence of income tax incentives to Indonesian corporate performance somewhat in a higher degree than the Australian peers. We have also concluded that Indonesian government provide a relatively more interesting income tax incentives compare to Australian government. However, an average method of net income –a method applied in Australia– could be considered by Indonesian government to avoid a market price fluctuation in this industry.
S Ayyappan, M Sakthivadivel, Sakthi Vadival
International Journal of Finance & Banking Studies (2147-4486), Volume 2, pp 100-108; doi:10.20525/ijfbs.v2i2.149

Stress Management is getting more and more attention now-a-days, particularly in the financial sectors. There is no such thing like stress- free job. Everyone in their work is exposed to tension and anxiety as they gets through the duties assigned to them. Banking industry which is the backbone of the country’s economy is not an exceptional one. The job nature of banking employees is very tedious as it involves the direct customer interaction in all levels. So this study aims to analyse the level of stress faced by bank employees who are under different categories from both public and private sectors of selected banks which resides in Tamilnadu.
Christopher Udoka, Roland A Anyingang
International Journal of Finance & Banking Studies (2147-4486), Volume 3, pp 173-185; doi:10.20525/ijfbs.v3i1.178

The study investigated the operational efficiency of the Nigerian stock market between 1986-2010. This was necessary given the degree of thinness of the market. The objectives of the study were: to investigate the extent to which the operations of the market have contributed to the growth of the Nigerian economy and also to determine the functionality of the market. To achieve these objectives data were gathered on some capital market indicators from the stock exchange factbook of various years on market capitalization (MCAP), all share index (ASI) volume of transaction (VOLT) value of transaction (VALT) and number of listed companies (NLC) on the stock exchange. The data were tabulated, analyzed and tested using the ordinary least square statistical technique. Findings resulting from the test of data showed that NLC, VOLT, VALT, ASI and MCAP were positive and that increase in any of the above parameters would in turn cause an increase in the growth of the Nigerian economy at five and ten percent levels of significance. It further showed that the market was operationally weak form efficient. It was therefore recommended that government should continue to provide better macro-economic environment for the private sector to lead the economy on the part of sustainable growth and development.
Viyusani Moss, Vuyisani Moss
International Journal of Finance & Banking Studies (2147-4486), Volume 2, pp 66-75; doi:10.20525/ijfbs.v2i2.150

In investigating the non-payment phenomenon in South Africa’s low income households, a case study of Protea Glenx the researcher employed quantitative tools and qualitative methods. The rationale was prompted by high level of evictions and repossessions for non-payment of mortgages in the Protea Glen area in Johannesburg South Africa. The research approach was to measure and draw sample size from the units of population, conduct interviews and captureand analyse data through the use of SPSS as a suitable statistical instrument. Furthermore, the aim was to employ a suitable model for measuring the relationship between dependent and independent variables and also to highlight the limitations of the study. The findings of the study revealed several interesting empirical results that underpinning the importance of borrower education for mortgage account holders and the need by the banking sector to properly empower borrowers about credit behaviour, responsibilities and obligations of owning a property plus the ongoing costs of ownership.
Hamu Kedir Mohammed, Yonas Mekonnen Wetere, Mikael Shibru Bekelecha, W/mikael Shibru Bekelecha
International Journal of Finance & Banking Studies (2147-4486), Volume 4, pp 29-37; doi:10.20525/ijfbs.v4i2.218

A well-functioning financial institution will sustain a countries economic development and play a great role in reduction of poverty. One of the major participants in the financial institution is the banking industry. However, the mal-functioning of the banking system can be extremely costly to the real economy. As Bank is one of the participants and major key player in the financial institutions, it needs a continuous assessment by its supervisory and management. Mere ratio analyses are commonly used Performance measurement among the banking industry in Ethiopia. Nonetheless, these financial ratios are more of traditional as well as partial measurements. As such this study conducted using CAMEL framework set by bank for international settlement. The study takes secondary data which are gathered from audited annual reports of all banks. The result shows CAMEL framework is the best fit measurement for Ethiopian Banks and it give a comprehensive result which is very helpful for the governor to set a well determined policy and procedure.
Imad Kutum, Khaled Al-Jaberi
International Journal of Finance & Banking Studies (2147-4486), Volume 4, pp 44-56; doi:10.20525/ijfbs.v4i3.224

The aim of this research paper is to examine the Jordanian banks using financial soundness indicators. This is to establish if Jordanian banks were affected because of the 2007/2008 financial crisis and determine the underlying reasons. The research paper was conducted on 25 banks in Jordan listed in the countries securities exchange. The research methodology used consisted of examining the banks financial records in order to derive four crucial Basel III ratio such as the capital adequacy ratio, the leverage ratio, the liquidity ratio and finally the Total Provisions (As % Of Non-Performing Loans) %. The results revealed that out of the four hypotheses under examination Jordan Banks do not meet Basel financial Indicators for Capital Adequacy Ratio, Jordan Banks does not meet Basel financial Indicators for Liquidity Ratio , Jordan Banks do not meet Basel financial Indicators for Leverage Ratio and Jordan Banks do not meet Basel financial Indicators for Total Provisions (As % Of Non-Performing Loans) ratio. Only one hypothesis was accepted based on the research outcomes. The rest of the hypothesis was rejected since the average trend line did not go below the Basel III required ratio level. The general outcome of the research revealed that Jordanian banks were not affected significantly by the financial crisis.
Swarn Chatterjee
International Journal of Finance & Banking Studies (2147-4486), Volume 3; doi:10.20525/.v3i1.166

This paper investigates whether false confidence, as characterized by a high level of personal mastery and a low level of intelligence (IQ), results in frequent investor trading and subsequent investor wealth erosion across time. Using the National Longitudinal Survey (NLSY79), change in wealth and asset allocation across time is modeled as a function of various behavioral, socio-economic and demographic variables drawn from prior literature. Findings of this research reveal that false confidence is indeed a predictor of trading activity in individual investment assets, and it also has a negative impact on individual wealth creation across time.
Shrikant Krupasindhu Panigrahi, Yuserrie Bin Zainuddin, Noor Azlinna Binti Azizan
International Journal of Finance & Banking Studies (2147-4486), Volume 3; doi:10.20525/.v3i1.173

In this paper, the author investigated the influence of management decisions like capital structure, dividend policies, remunerations, credit policy decisions and investment decisions on shareholder wealth maximization. The main objective of this paper is to increase awareness and relationship between management and shareholders of the companies. To achieve the objective, portfolio theory, capital asset pricing model and modern financial theory providing evidence on the linkage between management decisions to shareholder’s value. Shareholders are only concerned about the value of shares of the company and the amount of return in the form of dividend paid. Thus in order to meet the demands of the shareholders of the company, managers needs to increase their abilities and skills to overcome the organizational goals. Thus the main goal of this paper is to discuss on the role of management decisions towards increasing shareholder’s wealth and meet organizational goals.
Faten Zoghlami
International Journal of Finance & Banking Studies (2147-4486), Volume 2, pp 1-10; doi:10.20525/ijfbs.v2i1.136

The puzzling momentum strategies’ payoffs are defying the rational financial theory asserting the stocks returns’ unpredictability. Moreover, the momentum effect persist the main stocks returns’ anomaly escaping any risk-based explanation. The resilience of this phenomenon had favoured the development of behavioural financial field, which breaks with the investor’ full rationality hypothesis. This paper attempts to reconcile between the rational and behavioural financial theories, through the introduction of the progressive rationality concept. Especially, we argue that recognizing the temporary inappropriate investors’ reactions; can resolve the puzzling momentum anomaly. To fulfil our objective, first we correct the monthly returns inherent to 56 stocks listed on the Tunisian stocks market from January 1998 to December 2011, from the related serial autocorrelations involved by the investors’ over and under reactions. Then, we examine the 6/6 momentum strategy’ excess returns before and after the monthly returns serial autocorrelations’ corrections. The result show that the momentum strategy is still profitable but no longer puzzling, since the related excess return is henceforth fully captured by a β and a size effect..
Ebenezer Y Akinkoye, Lukman Oyeyinka Oyelami
International Journal of Finance & Banking Studies (2147-4486), Volume 3; doi:10.20525/.v3i1.174

This study investigates the impact of bank recapitalization on real sector performance in Nigeria. Specifically, the study examines the direct effect (bank investment) and indirect effect (loans and advances to real sector) on realsector output growth between the period 1986 and 2012.This study departs from previous studies because we aggregate the three leading sectors (agriculture, manufacturing and building and construction) of the Nigerianeconomy to arrive at our real sector index. Also, having carefully subjected our data to necessary econometric tests we employed chow test for structural break to test for the existence of policy shift between bank capital base and loanto the real sector of the Nigerian economy as a result of bank recapitalisation policy .Similarly, OLS estimates was used to determine the direct and indirect effect of bank capital base and real sector output growth. The results fromstructure break tests reveal that bank recapitalization policy causes policy shift in bank capital base and loan to real sector thus the policy is of significant impact to real sector performance .In corollary, the result from the OLS stronglyindicates that bank capital base has significant effect on real sector output growth directly and indirectly. We then conclude that Nigerian banks should be adequately capitalised as to play active intermediateting roles expected ofthem in this modern and competitive global economy
Nadiya Marakkath
International Journal of Finance & Banking Studies (2147-4486), Volume 1, pp 15-20; doi:10.20525/ijfbs.v1i1.132

This study is a discussion on the ‘Non-Governmental Organization-Microfinance Institution Partnership Model’ and ‘Securitization Model’ used by Indian microfinance institutions to achieve cost efficiency. These two models are effective strategies devised and used by efficient and sustainable Indian MFIs to reduce their operating cost and financing cost. Achieving such cost efficiency is crucial for microfinance institutions to attain operational self-sustainability without levying high interest rates. Using interview method the study elicits information on these innovative strategies and recommends them to be worthy of emulation for other microfinance institutions operating in the Indian microfinance industry.
Ihsan Kulali, Ihsan Kulalı
International Journal of Finance & Banking Studies (2147-4486), Volume 5, pp 46-57; doi:10.20525/ijfbs.v5i2.123

Etkin Piyasalar Hipotezi ve Davranışsal Finans, finansal literatürün karşıt argümanları savunan iki temel modelini oluşturmaktadır. Bunlardan ilki yatırımcıları rasyonel olarak kabul ederken diğeri ise yatırımcıları normal olarak ifade etmektedir. Etkin Piyasa Hipotezi’ne göre piyasalar bilgisel olarak daima etkindir. Hisseler en nihayetinde denge fiyatına ulaşacaktır. Yaşanan finansal krizler ise kısa dönemli düzeltme hareketleridir. Davranışsal finans, alternatif bir model olarak geliştirilmiştir. Buna göre yatırımcılar farklı bilgilere farklı zamanlarda ulaşmaktadır ve onları farklı değerlendirmektedir. Yatırım kararları psikolojik ve duygusal faktörlerden etkilenmektedir. Yatırımcıların makine olarak görülmesi kabul edilemez. Davranışsal finans çok daha yeni bir konumdadır ve çok sayıda yeni çalışmaya ihtiyaç duymaktadır. Bununla birlikte iki teori arasındaki çatışma yeni finansal krizlerin önlenmesi açısından çok önemlidir. Yakın gelecekte teorilerin karşıt olmaktan ziyade tamamlayıcı olarak kullanılması beklenmektedir.
L Vachya, B. Kamaiah, V Vachya L
International Journal of Finance & Banking Studies (2147-4486), Volume 4, pp 51-69; doi:10.20525/ijfbs.v4i1.204

The present study seeks to examine the role of microfinance and its impact on economic and social empowerment of women. The study used multi-stage stratified proportionate random sampling technique in the selection of the representative district, mandal/taluka, villages and households. Empirically acclaimed logistic regression model has been employed for analyzing significant impact of plausible socio-economic factors on women empowerment. The study found that the socio-economic indicators have undergone significant changes. It also emerged that there has been an increase in women participation in the household decision making process. The study suggests that the government should prepare suitable plans and programmes for the social and economic empowerment of women. The study also suggests that policy measures such as increase in frequency of SHG meeting, SHG training programme, increase in loan amount and ensuring effective utilization of the loan, may be the useful initiatives to enhance women empowerment, income and employment opportunities.
, Hasan Dincer, Umit Hacioglu
International Journal of Finance & Banking Studies (2147-4486), Volume 4, pp 1-17; doi:10.20525/ijfbs.v4i4.35

This paper demonstrates the relationship between CAMELS ratios and credit ratings of deposit banks in Turkey. Annual data was used for the period between 2004 and 2014 in this study. Moreover, 20 deposit banks of Turkey were analyzed and 21 different ratios of CAMELS components were used. In addition to that, credit ratings of these banks were provided from Moody’s corporation or annual activity reports of the banks. After that, we created multi nominal logistic regression analysis in order to illustrate the relationship. The major finding in this study is that three components (Asset Quality, Management Quality, and Sensitivity to Market Risk) of CAMELS have effects on credit ratings whereas the ratios related to Capital Adequacy and Earnings are not effective. As a result, it was recommended that Turkish deposit banks should concentrate on the percentage of fixed assets and interest income to have a better rating. Moreover, having high market share with respect to total assets and lower interest expense are also other important points for this purpose. On the other hand, Turkish deposit banks should control the proportion of financial assets and increase the amount of FX liquid assets to prevent credit ratings to decrease. Additionally, market share of banks for loans should not reach at high level for this objective.
Ramesh Chandra Das, Arun Kumar Patra
International Journal of Finance & Banking Studies (2147-4486), Volume 3; doi:10.20525/.v3i1.169

The reform agenda in the financial as well as banking sector in the Indian economy was not only in the target of achieving profitable banking business but also to reduce the magnitude of banking funds locked in the bad debt account so that, among others, the real delivery of credit (the credit-deposit ratio) rises in overall fronts. The Narasimham Committee Report in respect of reducing magnitude of non- performing assets has been framed in line with the Basel Norm regarding the asset quality of the banks where capital adequacy ratio has been fixed for different banks to achieve within different time periods. The present study, under such a back ground, has been structured to examine the profile of all Scheduled Commercial Banks in all ranges of CRAR over time in aggregate and bank group specific and to measure degree of correlation of NPA-Deposit ratio with CRAR trends and Credit-Deposit Ratio in all ranges of CRAR and their significance levels for the time period 1995-96 to 2009-2010. It has been observed that there has been variation across banks in following the guidelines of the reform committee. SBI group and foreign banks have been performing well in this respect. There has been rising trend of the proportions of banks in the above 10 per cent range of CRAR. The NPA/D ratio and C-D ratio have been observed to be positively and negatively correlated respectively for the first three ranges of CRAR and reverse in the above 10 per cent range. The correlation between the NPA/D ratio and C-D ratio is negative and significant.
Selvarajan Bsr
International Journal of Finance & Banking Studies (2147-4486), Volume 2; doi:10.20525/.v2i1.139

The problem of NPA is not limited to only Indian public sector banks, but it prevails in the entire banking industry. Major portion of bad debts in Indian Banks arose out of lending to the priority sector at the dictates of politicians and bureaucrats. If only banks had monitored their loans effectively, the bad debt problem could have been contained if not eliminated. The present study has been designed to illustrate the necessity and the nature of the non-performing assets in Indian Bank, Tamil Nadu. Finding out Non Performing Assets –NPA- under the Priority sector lending in Indian Bank and Compare with Public Sector Banks and making appropriate suggestions to avoid future NPAs and to manage existing NPAs in Indian Bank are the other major objectives of this study. The scope of this study covers on the basis: (i) measuring for the banks to avoid future NPAs & to reduce existing NPAs, (ii) guiding for the government in creating & implementing new strategies to control NPAs, (iii) selecting appropriate techniques suited to manage the NPAs and develop a time bound action plan to arrest the growth of NPAs.
Seher Abbasi, Fahimeh Moosavi
International Journal of Finance & Banking Studies (2147-4486), Volume 1, pp 29-34; doi:10.20525/ijfbs.v1i1.134

This paper considers the problem of finding the shortest path in a static network, where the costs are constant. The CE Algorithm based strategy that is presented by Rubinstein to solving rare event and combinatorial optimization problem is modified to finding shortest path in this research. To analyze the efficiency of the used algorithm three sets of small, medium and large sized problems that generated randomly are solved. The results on the set of problems show that the modified algorithm produces good solutions and time saving in computation of large-scale network.
Ernest Osas Ugiagbe
International Journal of Finance & Banking Studies (2147-4486), Volume 3, pp 28-47; doi:10.20525/.v3i2.182

The study examines the perceptions of the services of the micro finance Institutions by the women service users, and how the services of micro Institutions affect businesses of the beneficiaries of the micro credit loans. The research design for the study was the survey method. The instruments of data collection were structured questionnaires and in-depth interview. A total of 450 questionnaires were administered to the female participants, and senior management personnel of the micro credit institutions were interviewed. The cluster and simple random sampling were used to select the participants for the study. The leaders of registered unions were the informants. The result reveals that the poor services and attitude of officials of micro finance institutions and other problems like the regressive tax regimes, harsh economic climate and patriarchy are negatively affecting the business ventures of the loan beneficiaries and by implication the goals of poverty reduction via micro credit scheme . The women beneficiaries are groaning under the burden of loan repayment and meeting other obligations as mothers and wives. This study is applicable in the context of social policy development at this time when social services delivery is not only poor but at dismal level. The need for gender sensitive and social development becomes imperative. It is critical to social work practice in the context of advocacy, empowerment programs, facilitating and initiating service delivery and Community organizing by social workers that will enhance the war against Poverty and other social impediments against women empowerment in Nigeria.
James Atta Peprah
International Journal of Finance & Banking Studies (2147-4486), Volume 1, pp 1-14; doi:10.20525/ijfbs.v1i1.131

Less attention has been given to well-being and other household characteristics that influence clients’ access to micro-credit among women households especially. The paper investigates the determinants of access to credit by 320 women entrepreneurs in the Mfantsiman Municipality in the Central Region of Ghana. Data for the study was collected in June-July 2010 from six communities including Mankessim, Saltpond, Anomabu, Biriwa and Yamoransa. Sturctured questionnaires were used to collect the data from women entrepreneurs. The results of the study indicate that clients’ well-being influences access to credit amount. Clients who have been in business for long time are likely to access larger loan amounts. Marital status and education do not influence access to credit. Among the recommendations are that microfinance should not only target clients with high well-being scores but those with low well-being scores since the original aim of microfinance is to lift the poor out of poverty. It is important to give credit to aged business owners instead of young ones. Giving credit to married women because their husbands could serve as guarantors does not matter much but rather women who do not have husbands also need to benefit from micro-credit.
Maria Elvira Mendez Pinedo
International Journal of Finance & Banking Studies (2147-4486), Volume 3, pp 41-67; doi:10.20525/ijfbs.v3i4.191

Six years after the financial crisis that led to the collapse of the banking system in 2008, the over-indebtedness of households is one of the most important problems in Iceland. This study aims to cast light on a specific feature of the Icelandic credit system in connection with the problem of over-indebtedness. The main research question is whether the end of indexation of credit is close or not. The author argues, in the first place, that indexation of credit ex-post to the consumer price index (CPI) in negative amortization schemes is responsible for over-indebtedness. In the second place, the author describes the challenges ahead in the field of consumer and mortgage credit in Iceland in the light of European law (European Union EU and European Economic Area EEA). The incorporation of Directive 2008/48 on credit agreement for consumers to the Icelandic domestic order through the EEA Agreement allowed a preliminary legal review of the practice in light of EU/EEA consumer credit law, both at national and European level without a final conclusion. It has nevertheless led to the judicial review on the legality of some indexation alleged malpractices before national courts and to the EFTA Court for interpretation (mostly on Directives 93/13/EEC on unfair terms 87/102/EEC on consumer credit). A ruling from the Supreme Court is expected on several cases. A critical battle between the legality, the fairness and the legitimacy of indexation of credit is taking place in Iceland under the influence of European law.
Frances Susan Obafemi, Olumide Ayodele, Friday Ebong
International Journal of Finance & Banking Studies (2147-4486), Volume 2, pp 78-91; doi:10.20525/ijfbs.v2i4.164

The paper employed a two-stage Data Envelopment Analysis (DEA) approach to examine the sources of technical efficiency in the Nigerian banking sub-sector. Using a cross section of commercial and merchant banks, the study showed that the Nigerian banking industry was not efficient both in the pre-and-post-liberalization era. The study further revealed that market share was the strongest determinant of technical efficiency in the Nigerian banking Industry. Thus, appropriate macroeconomic policy, institutional development and structural reforms must accompany financial liberalization to create the stable environment required for it to succeed. Hence, the present bank consolidation and reforms by the Central Bank of Nigeria, which started with Soludo and continued with Sanusi, are considered necessary, especially in the areas of e banking and reorganizing the management of banks.
Dipayan Roy
International Journal of Finance & Banking Studies (2147-4486), Volume 3, pp 150-160; doi:10.20525/.v3i1.176

The proactively evolved banking regulations in the Indian Banking sector under the authorative directive of the Reserve bank of India (RBI) has often brought about a change in the business strategy, capital structure and operations of the banks in the Indian banking sector. During these events of continuous change and adoption of Basel norms, we analyse the efficiency of the Indian banking sector with using Data Envelopment Analysis across three economic eras andacross the different ownership structures. The determinants of efficiency are selected on the basis of intermediation approach. We also attempt to identify whether the inefficiency arises from managerial incompetence or improper size and resource allocation. From our analysis, we identify the main cause of inefficiency in the Indian Banking sector to be arising out of improper size allocation.
Shaowen Hua
International Journal of Finance & Banking Studies (2147-4486), Volume 5, pp 42-56; doi:10.20525/ijfbs.v5i3.278

I explore company characteristics which explain the difference in analysts’ recommendations for companies that were underwritten (affiliated) versus non-underwritten (unaffiliated) by analysts’ brokerage firms. Prior literature documents that analysts issue more optimistic recommendations to underwriting clients of analysts’ brokerage employers. Extant research uses regression models to find general associations between recommendations and financial qualities of companies, with or without underwriting relationship. However, regression models cannot identify the qualities that cause the most difference in recommendations between affiliated versus unaffiliated companies. I adopt uplift random forest model, a popular technique in recent marketing and healthcare research, to identify the type of companies that earn analysts’ favor. I find that companies of stable earnings in the past, higher book-to-market ratio, smaller sizes, worsened earnings, and lower forward PE ratio are likely to receive higher recommendations if they are affiliated with analysts than if they are unaffiliated with analysts. With uplift random forest model, I show that analysts pay more attention on price-related than earnings-related matrices when they value affiliated versus unaffiliated companies. This paper contributes to the literature by introducing an effective predictive model to capital market research and shedding additional light on the usefulness of analysts’ reports.
Yesim Ali̇efendi̇oglu, Erol Demir, Harun Tanrıvermiş
International Journal of Finance & Banking Studies (2147-4486), Volume 5, pp 30-51; doi:10.20525/ijfbs.v5i5.711

Bu araştırmada, kamu iktisadi teşekkülü olarak faaliyet gösteren Elektrik Üretim Anonim Şirketi (EÜAŞ) Genel Müdürlüğü Hirfanlı Hidroelektrik Santrali (HES) İşletmesi’nin aktifinde kayıtlı maddi duran varlıklarının gerçeğe uygun değerleri ile envanter kayıtlarında yer alan tarihi (net) değerleri karşılaştırılmıştır. Araştırmada varlık değerleme çalışmasında; bilimsel esaslar, uluslararası standartlar ve mevzuatın amir hükümlerine göre gerçekleştirilmiş ve işletmenin varlıkların değerlenmesinde piyasa değeri (emsal değer, ikame değeri), maliyet yönetimi ve diğer değerleme ölçütlerinden faydalanılmıştır. İşletmenin mevcut mali kayıtlarına göre maddi duran varlıklarının 2016 yılının fiyatları üzerinden toplam değerinin (8.872.054,07 TL), söz konusu varlıkların güncel değerinden (54.342.356,11 TL) yaklaşık 6 kat daha düşük olduğu ve doğal olarak işletmenin varlık değerinin olduğundan çok daha düşük olarak kayıtlara yansıtıldığı dikkati çekmektedir. Araştırma sonuçlarına göre işletmenin maddi duran varlıkların envanter ve değerleme çalışmalarının, gerçek varlık değerlerinin analiz edilmesi ve çıkan sonuçların finansal yönden yorumlaması bakımından anlamlı olduğu ortaya konulmuştur.
Veli Akel, Talip Torun, Barış Aksoy
International Journal of Finance & Banking Studies (2147-4486), Volume 5, pp 01-15; doi:10.20525/ijfbs.v5i5.636

Bu çalışmanın amacı, Türkiye’de hayat dışı sigortacılık sektöründe aktif karlılığı ile firmaya özgü faktörler arasındaki ilişkiyi tespit ederek aktif kârlılığının etkinlikten mi yoksa yoğunlaşmadan mı kaynaklandığını belirlemektir. Bu amaçla, Türk sigorta sektöründe faaliyet gösteren 36 hayat dışı sigorta şirketi arasında 2015 yılı verilerine göre pazarın toplam %83.38’ini oluşturan 15 sigorta şirketinin 2010-2015 dönemine ait mali verileri ile performans ilişkisine yönelik Period SUR panel veri analizi yapılmıştır. Analiz sonuçlarına göre, aktif büyüklüğü, likidite ve pazar payı değişkenleri ile aktif karlılığı arasında pozitif ve istatistiki olarak anlamlı bir ilişki tespit edilmişken kaldıraç, hasar/prim oranı ve firma yaşı değişkenleri arasında ise negatif ve istatistiki olarak anlamlı bir ilişki tespit edilmiştir. Analiz dönemi boyunca Herfindahl–Hirschman Endeksi değerleri 1.500’ün altında olduğu için Türkiye’de hayat dışı sigortacılık sektörünün yoğun olmayan bir piyasa görünümünde olduğu tespit edilmiştir. Bu nedenle, hayat dışı sigortacılık sektöründe aktif kârlılığı yoğunlaşmadan daha ziyade faaliyetlerdeki etkinlikten kaynaklanmaktadır.
Godwin Emmanuel Oyedokun
International Journal of Finance & Banking Studies (2147-4486), Volume 7, pp 44-65; doi:10.20525/ijfbs.v7i3.37

This study investigates how the development of human capital is related to economic growth in Nigeria from 1980 to 2015. Data were sourced from the Central Bank of Nigeria and the National Bureau of Statistics. The study employed Augmented Dickey-Fuller (ADF) to estimate the relationship among the variables used in this study which revealed that there is a positive long-run relationship among public expenditure on education and health, total school enrolment, gross capital formation, employment rate, life expectancy rate and economic growth. The study recommended that the government should put in place the required education and training policy that would guarantee quality schooling for different level of education. Government should also commit more funds to health sector to enhance human capital formation. It was also recommended there should be more pragmatic means to develop human capabilities.
Arber Hoti, Arben Dermaku
International Journal of Finance & Banking Studies (2147-4486), Volume 7, pp 20-34; doi:10.20525/ijfbs.v7i3.184

The main purpose of this research is to study the impact of corporate governance on the financial performance of the banking sector in Kosovo. To analyze this impact, the Pearson correlation coefficient, multiple regression analysis related to the board size and board independence and banking sector performance in Kosovo were applied. The key corporate governance variables that have been studied in this research are: (i) size of the board of directors, (ii) the independence of the board of directors (the ratio between non-executive directors and the total number of board members). The data for this research were collected from the annual reports and audited financial statements of commercial banks in Kosovo for the 12 year period (2006-2017) and from questionnaires addressed to board members of commercial banks in Kosovo as well as other publications from relevant local institutions such as the Central Bank of Kosovo (CBK), Statistical Office of Kosovo (SOK), Tax Administration of Kosovo (TAK), etc. The results of the multiple regression analysis regarding the influence of the board of directors on the financial performance of the banking sector indicate that: the size of the board of directors and the independence of the board of directors have a positive and significant impact on the financial performance of the banking sector in Kosovo, expressed through return on assets (ROA) and return on equity (ROE). Findings of this research are in line with the findings of other researchers in this field and confirm the assertion that the management of the above variables improves and has a positive impact on the financial performance of banks in Kosovo.
Arben Tërstena, Ismail Mehmeti, Sokol Krasniqi
International Journal of Finance & Banking Studies (2147-4486), Volume 8, pp 77-87; doi:10.20525/ijfbs.v8i3.497

The purpose of this paper is to identify the role of fiscal policy in Kosovo, comparing with the Western Balkan countries, in the trends of economic development, which are related to the international market, and how to achieve the objectives of the economy of Kosovo, penetrating the foreign market of local companies, using fiscal policy instruments. Data processing is performed using deductive-analytical methods, describing and comparing research findings by commercial companies, extracting data and comparing official reports of national and international institutions on the role of policies analyzed in the Western Balkan countries and in Kosovo, and the results of the research are based on these analyzes. Each sovereign state has its own fiscal policy operating within the financial system of that country, which also influences the development trends of international trade, the same applies to Kosovo and the Western Balkan countries, where this policy includes customs tax, VAT, tax in personal income, etc. The government of the country, through fiscal policy instruments, creates conditions for companies to be as present in the foreign market as possible with their products, which impacts on the overall economic development of the country. achieved. The paper provides insights into the state of the fiscal system in Kosovo, how fiscal policy affects the creation of conditions for foreign trade development, where is Kosovo's economy is in relation to the Western Balkan countries and what are the steps needed to improve it. The paper provides real data on the state of the fiscal system in Kosovo and its full role in the development of foreign trade in relation to the Western Balkan countries.
Antonio Jaramillo Dayag, Fernando L. Trinidad
International Journal of Finance & Banking Studies (2147-4486), Volume 8, pp 51-57; doi:10.20525/ijfbs.v8i3.492

Universal banks combine commercial loan services and public deposit functions with investment, and other services such as home and auto financing, mutual funds, pension and insurance to name a few. The importance of universal banks have been recognized in emerging economies, and its growth spur economic growth and development of many countries in the world. Most universal banks are listed in stock exchanges, and as financial intermediaries, not only these banks expand their already wide portfolios but they allow more global investors into the fold, almost like a foreign direct investor, the difference only is, the investor don’t have to leave the home country. Since these banks are considered to be among the key players in stock markets, and this study seeks to understand what factors drive their performance in stock exchange so that global investors be aided in making investment decisions on universal banks.
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