Banks and Bank Systems

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ISSN / EISSN : 1816-7403 / 1991-7074
Current Publisher: LLC CPC Business Perspectives (10.21511)
Total articles ≅ 326
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Abdul Bashiru Jibril, Michael Adu Kwarteng, Miloslava Chovancová, Jurgen Bode
Banks and Bank Systems, Volume 15, pp 1-14; doi:10.21511/bbs.15(4).2020.01

Researchers have long pondered on the online banking transaction adoption. Some of these studies focus primarily on the motivating factors that affect customers’ intention to adopt/accept these services (technologies). However, research into the constraining factors, in particular socio-economic factors, barely exist in the literature, especially in the context of sub-Saharan Africa. Against this background, the paper seeks to fill in this gap by: (1) assessing the socio-economic factors impeding the engagement of e-banking transactions among retail bank customers in Ghana, and (2) examining the moderating effect of ‘customer experience of Internet’ on the identified factors that inhibit the engagement in online banking in Ghana. The paper used a quantitative research approach to obtain data from two leading Ghanaian banks. Out of the 450 questionnaires distributed, 393 were valid for analysis. Data were analyzed with the aid of PLS-SEM (partial least squares and structural equation modeling). Findings revealed that perceived knowledge gap and the price of digital devices were directly important to the intention to disembark on e-banking transactions among Ghanaian bank customers. Whilst customer experience (frequent use of the Internet), as a moderator variable, has a significant effect on the interaction between perceived knowledge gap and the intent to disembark on e-banking transactions; and finance charges and the intent to disembark on e-banking transactions. Study implications and directions for future research are discussed in the paper. AcknowledgmentThis work was supported by the Internal Grant Agency of Tomas Bata University under the Projects no. IGA/FaME/2019/008 and IGA/FaME/2020/002. The authors would like to extend their appreciation to Prof. Boris Popesko (Vice-dean for Research and Business Liaison) at the Faculty of Management and Economics for facilitating the financial readiness of this project.
Banks and Bank Systems; doi:10.21511/bbs

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Hamed Ahmad Almahadin, Thair Kaddumi, Qais Al-Kilani
Banks and Bank Systems, Volume 15, pp 218-227; doi:10.21511/bbs.15(3).2020.19

The main purpose of this study is to investigate the relationship between financial stability and banking soundness in Jordan. For this purpose, the study mainly uses the FMOLS approach in addition to other analysis techniques and tools. The outcomes of the descriptive analysis show that the Jordanian financial system seems stable, and the indicators of banking soundness signal a steady and solid banking sector. The cointegration tests indicate that the considered variables have a long-term equilibrium relationship; the variables move together in the long term. The empirical results reveal that the majority of the banking soundness indicators have a positive impact on financial stability. This asserts that a sound banking sector plays a vital role in maintaining a stable financial system. However, the findings also indicate that a steady interest rate policy is one of the significant requirements for sustaining the stability of financial systems. Moreover, the response of financial stability with respect to economic growth changes is found to be positive and relatively high. On the fact of the importance of the topic under study, since financial stability is one of the major concerns of the authority bodies, the empirical findings can have very important policy implications for decision-makers.
Amenawo I. Offiong, Hodo B. Riman, Godwin B. James, Emmanuel E. Okon, Anthony Ogar
Banks and Bank Systems, Volume 15, pp 207-217; doi:10.21511/bbs.15(3).2020.18

Bank capital is one of the protective and necessary parameters for better performance in any banking system. This may explain why the industry in Nigeria has been constantly recapitalized for sectorial enhancement. Given the various bank capital reforms the sectors have undergone and a number of interventions, the question arose: How adequate is capital? The study used descriptive statistics and Levene’s test for equality of variance, as well as an independent sample t-test to look at the (10) ten various performance parameters for both pre- and post- recapitalization periods. From the results of the analysis, most of the performance parameters did not improve after post-recapitalization. This answers the question posed by the study that capital is not adequate in the Nigerian banking sector. Therefore, there is a need to inject more bank capital into the Nigerian banking sector if this sector must have a greater impact and respond to the challenges of the Nigerian economy for sustainable growth and development.
Ivan S. Blahun, Semen I. Blahun
Banks and Bank Systems, Volume 15, pp 171-183; doi:10.21511/bbs.15(3).2020.15

The functioning of the country’s banking system is the basis for ensuring its economic development and stability. The state of the banking system often causes financial crises; therefore, ensuring its stable work is one of the main tasks of monetary policy. Meanwhile, it is important to find approaches to a comprehensive assessment and forecasting of the stability of the banking system that would allow obtaining adequate results.Based on a sample of data generated for the period from 2008 to the 1st quarter of 2020 with a quarterly breakdown, an integrated stability index of Ukraine’s banking system was estimated. The analysis was based on 23 variables that characterize certain aspects of the functioning of the Ukrainian banking system.Using the principal component analysis, five factors have been identified that have the greatest impact on ensuring the stability of the banking system. They were used to form an integrated index based on the application of the Mamdani fuzzy logic method. The results obtained adequately reflected the state of stability of the banking system for the analyzed period, which coincided in time with the crisis phenomena occurring in the Ukrainian banking system. The obtained value of the integrated index characterizes the stability of Ukraine’s banking system at the average level, since it depends not only on the internal state of the system, but also on the influence of external factors, both national and international.
Serhiy Frolov, Fathi Shukairi
Banks and Bank Systems, Volume 15, pp 184-198; doi:10.21511/bbs.15(3).2020.16

The formation and functioning of the country’s financial system depend on many factors, both endogenous and exogenous. The economic system of a country, as a higher-order system in relation to the financial one, underlies the development of the financial system model. The existing model of the financial system becomes significant in the context of its impact on economic processes in the country. The main purpose of the empirical analysis is to confirm the thesis about the signs of the bank-centricity of the Ukrainian financial market. The share of assets of financial intermediaries in GDP is determined, which indicates a significant decrease in the share of assets of all financial intermediaries in Ukraine. Analysis of the loan-to-deposit ratio in the banking system of Ukraine shows that the deposit base was far smaller than the size of loans throughout the analyzed period. Analysis of non-performing loans by economic sectors shows that the largest share of NPLs is formed in the corporate sector of the economy. Analysis of the structure of banks’ assets, taking into account their owners, shows that at the end of the analyzed period the share of state-owned banks’ assets increased significantly. Thus, having analyzed the functioning of the banking system of Ukraine, one can conclude about the bank-centric nature of Ukraine’s financial system.
Rosemarie Sutjiati Njotoprajitno, Bram Hadianto, Melvin
Banks and Bank Systems, Volume 15, pp 199-206; doi:10.21511/bbs.15(3).2020.17

The distribution of funds becomes the identity and function of banks. By performing this function well, the banks can get profit to survive. One of the considered factors affecting this channeling function is the issuance of government bonds to finance the state budget, which may be harmful to this bank channeling function. Therefore, to prove this situation, it is necessary to check a causal relationship between the government bond value and the bank intermediary function through this study, adding bank size and loans as a control variable. This study utilizes the banks listed on the capital market of Indonesia as the population. Furthermore, the Slovin formula and a simple random sampling method are employed to determine the number of banks to be the samples and take them. Also, the regression model with pooled data and the t-statistic test are used to estimate its coefficients and examine the proposed hypotheses, respectively. Overall, this study demonstrates that the government bond value positively affects the bank intermediary function. This indicates that the crowding-out does not exist. By this evidence, the government does not need to worry because this debt does not disturb the bank function to deliver the credit to society. Likewise, bank size and bad loans have a positive impact on this function. Thus, banks must be able to diversify risks among their assets and restructure bad loans when performing this function.
Christo Bisschoff
Banks and Bank Systems, Volume 15, pp 160-170; doi:10.21511/bbs.15(3).2020.14

The purpose of the study is to measure behavioral, attitudinal and other brand loyalty antecedents, and to develop an operating model for measuring and managing brand loyalty of commercial banks clients. A random sample of 500 members of the South African Commercial Institute, who are also commercial banks’ clients, received a 5-point Likert scale questionnaire to be completed online via Twitter and Facebook. About 196 people completed the questionnaire. The data possess construct validity and reliability (α ≥ 0.70). The results show that seven of the 12 original antecedents are banking related, namely five Attitudinal antecedents (r2 = 0.557) and two Other antecedents (r2 = 0.442). Behavioral antecedents were not important to bank clients. All the antecedents have factor loadings above 0.60, and there is a significant positive correlation between Attitude and the Other antecedents (r = 0.75; p ≤ 0.01). This means that the model is useful for managers in managing brand loyalty at their banks. It is also of value to researchers and academia looking to conduct further research on how to measure and manage brand loyalty. However, a caution is that the data originated from South African banks’ clients. Country-specific influences can cause different brand loyalty preferences among international banks’ clients. AcknowledgmentI wish to acknowledge Mr. Sarel Salim for his contribution to administering the data collection for the original research on brand loyalty in banking (see also Salim and Bisschoff, 2014 in the reference list).
Hel Ajmi Jameel Al-Dhaimesh
Banks and Bank Systems, Volume 15, pp 147-159; doi:10.21511/bbs.15(3).2020.13

This study aims to examine the effect of monetary and financial variables on share prices of Jordanian commercial banks for the period 2001–2018. The monetary variables used in the research include broad money supply, the interest rate on time deposits and inflation, while financial variables include both the deficit of the general budget and government expenditures, and the general government domestic debt. A multiple linear regression equation is designed using E-Views program to test this effect. The study shows that there is a significant positive effect of broad money supply, whereas a negative effect of the general budget deficit and a positive effect of the domestic debt on share prices of commercial banks in Jordan for the specified period. In contrast, there is no effect of both inflation and the interest rate on time deposits and government expenditures on the price of shares of Jordanian commercial banks. The study recommends taking into account the relationship between the variables mentioned in the prices of shares of commercial banks when setting monetary and financial policies by the central bank and the government to determine the extent to which these variables reflect share prices of Jordanian commercial banks. Overall, the regression model reached R2 = 0.63, and this means that 63% of the change in the share prices of Jordanian commercial banks is due to changes in the independent variables included in the model.
Anzhela Ignatyuk, Valerii Osetskyi, Mykhaylo Makarenko, Alina Artemenko
Banks and Bank Systems, Volume 15, pp 129-146; doi:10.21511/bbs.15(3).2020.12

The study identifies the features of the USD/UAH exchange rate dynamics for the period from January 2014 to May 2020. The main purpose of the empirical analysis is to determine the current trend of the USD/UAH exchange rate (is it random or permanent), indicate the presence of seasonality in foreign exchange rate dynamics and evaluate its sensitivity to external shocks. Three hypotheses are tested using several methods of time series analysis (autocorrelation analysis, ADF, Phillips-Perron and Granger tests), including a trend-season model using a time series of one variable (ARMA), a multifactor VAR-model, impulse functions. The results show that, the movement of the hryvnia exchange rate against the US dollar is a stochastic process. Its trend has a random component and tends to change sharply over time. Moreover, exchange rate fluctuations are seasonal. It depreciates in the first and second quarters, and strengthens in the third and fourth. Some macroeconomic indicators cause a positive or negative reaction of the USD/UAH exchange rate. This indicates that today the Ukrainian foreign exchange market is relatively efficient, but stable, since its reaction to external shocks is short-term, insignificant and tends to fade out. Although the findings are controversial, they support the generally accepted view that the exchange rate formation is a multifactorial process that depends on several macroeconomic factors. However, high volatility and random walk specification indicate that it is almost impossible to predict its future value at this time. AcknowledgmentThe material was prepared within the framework of the scientific research Modeling and Forecasting the Behavior of Financial Markets as an Information Base for Ensuring Financial Stability and Security of the State, No. 0117U003936 (supervisor Alex Plastun).
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