Essays in Empirical Corporate Finance

Purpose- This paper aim to look at the relationship between service quality and customer satisfaction, and the impact of CSR on customer satisfaction, the impact of customer satisfaction on word-of-mouth, the impact of customer satisfaction on loyalty intention. This paper also compares the effect of service quality across different types of commercial banks, including state-owned commercial banks and city commercial banks, using SERVQUAL model. Design/methodology/approach- The sample is made up 368 bank customers, 196 from stated-owned commercial banks and 172 from city commercial banks from different cities of Guangxi, China. The data have been collected using the structured questionnaire. T-test, F-test, Crosstab analysis and multiple regression be used for analyzing data. Findings- The result shows that perceived service quality is positively related to customer satisfaction, the results reveal that the responsiveness, assurance and empathy have highest impact on customer satisfaction. There is a significantly different perception of service quality between state-owned commercial banks and city commercial banks. Customers of city commercial banks has higher perceived service quality. On the other hand, this paper finds that older people of respondents are more satisfaction and more loyalty then younger respondents. This study also finds that CSR is positively related to customer satisfaction, customer satisfaction is positively related to word-of-mouth, customer satisfaction is positively is positively related to loyalty intention. Originality/value- First, this paper conducts a survey of commercial banks in China banking industry, and analyses the difference in perceived service quality between state-owned commercial banking and city commercial banking. It could be very useful from the managing marketing perspective in increase bank competitiveness. Second, this paper examines Chinese commercial banking service quality and the effects of every factors on customer satisfaction by quantitative analysis method. The result is helpful for improving customer satisfaction and preventing customer defections. Final, this paper the investigates level of CSR activity, customer satisfaction, word-of-mouth and loyalty intention, by studying customers’ behavior. The results could provide a suitable direction in order to meet customers’ demand trend.

Credit Default Swaps (CDS): Theory Emerging into Practice (Initiated by Reserve Bank of India)

The present study examined the impact of electronic banking on reducing the cost of new customers in Sirjan city banks. E-banking components in this research include: internet banking, mobile banking, telephone banking, point-of-sale (POS) terminals, automated teller machines (ATMs), and self-service kiosks. The statistical sample size includes 384 subjects who were determined from the active population of Sirjan city. Given that the study population was selected from different occupational groups and there was incongruity between the groups, multi-stage cluster sampling method has been used. Therefore, first, the population in different occupational classes is separated, then simple random sampling method was applied to determine the sample number in each class. To collect data in this research, was used. The questionnaire validity and reliability were obtained respectively, 0.91 and 0.79. In order to describe and analyze the collected data, spss software was used. Statistical analysis results showed that overall e-banking leads to an increase in customer attraction towards a commercial bank. Each of the components of electronic banking has a significant impact on attracting new customers in the bank. At the end, some recommendations have been presented for banks staff and managers to make an applied use of the research results. Keywords: Electronic Banking, Customer, Cost

National Bank of Romania establishes the monetary policy interest rate. The characteristicsof the Romanian’s financial system have impact on the degree of correlation between interest rates inthe banking system. This research uses the method of analyses of the impact of monetary policychanges in interest rate on key macroeconomic variables and on agriculture credit. The dimensionsand the evolution of agricultural credit show the restricted access of farms to the financial bankresources during the period 2007-2011. It is also evaluated the vulnerability of the agricultural system.The access of agricultural farms to the bank credit offer is determined through a series of factors.Romanian agriculture faced special problems regarding access to bank credits, because in competitionwith other sectors in the economic activity (industry, commerce, transportation etc.) agriculture wasthought to be unattractive and with a high risk for the banking sector. The evolution of the interest ratehas also a great impact on the evolution of agricultural products prices. Annual National Bank interestrates and inflation rates created difficulties in realizing the main objective - the prices stability. On thethird millennium, the development of a performing agriculture depends largely on the flexibility andefficiency of the crediting system practiced by the commercial banks and the access of agriculturalfarms to bank credits.

This paper analyzes the trends in financing and investing activities of companies in India in the recent past. While looking at the available trends, we have also tried to give a broad outlook for these in the near future. The first part deals with the financing options available to Indian companies. In the banking field, there has been an unprecedented growth and diversification of banking industry has been so tupendous that it has no parallel in the annals of banking anywhere in the world.The banking industry has experienced a series of significant transformations in the last few decades. Among the most important of them is the change in the type of organizations that dominate the landscape. Since the eighties, banks have increased the scope and scale of their activities and several banks have become very large institutions with a presence in multiple regions of the country.' The paper examines the new trends in commercial banking. We believe that loans from banks and related financial institutions will continue to be used by companies to raise capital. Therefore we have focused on other emerging alternatives for companies to finance their investment needs. Some of these are private equity, ECBs and alternative investment markets. Private Equity in India has been growing at a rapid pace mainly due to the booming Indian economy and the Bull Run.

Efficiency and Productivity Change of Banks: Evidence from a Small Island Development State

Rethinking Bank Regulation: A Review of the Historical Evidence

This paper investigates how technology influences banks’ efficient service delivery and reduces customers’ average waiting time in obtaining services in a commercial bank at Obafemi Awolowo University. The Direct non-participatory observation was adopted to record time measurements and primary data. The time measurements were based on customers’ arrival times to the banking hall and the service times of the customers who arrived at the bank between the hour of 12.00pm and 1.00pm which have been previously observed to be the bank’s peak period. Data were fitted into the model and the results computed and analyzed. The findings of the study show that both arrival of customers and service time rate of servers follow a poisson exponential probability distribution, respectively. The results reveal that the mean service rate, the mean time spent in the queue by a customer, and aggregate service rate in the system by a customer are substantially reduced and the waiting line is short in a technology driven bank. The study concluded that only technology driven services can reduce customers’ waiting time and improves efficient service delivery systems in Nigerian modern banking.

The study investigates the role of International Basel Capital Regulation in taming the financial capital via improving risk management in banking. The study examines if capital adequacy ratios of commercial banks calculated under Basel Capital Accord reflect credit risk, market risk, operational risk, liquidity risk, and economic impact in Pakistan. The study employed dual methodology utilising both primary and secondary data. A Liker-scale questionnaire was administered in addition to deploying panel data approach. The results of the study show that Credit risk and operational risk along with the size of bank and bank profitability show significant impact on capital requirements of the commercial banks of Pakistan. Credit risk showing significant negative relationship with the capital adequacy ratio of the commercial banks of Pakistan.

Do Financial Market Developments Influence Accounting Practices? Credit Default Swaps and Borrowers’ Reporting Conservatism

Risk-Shifting Behavior at Commercial Banks Under Different Deposit Insurance Systems: Further Evidence from U.S. Markets

Bank is an institution that acts as a financial intermediary between parties who have the funds with the parties who need funds as well as an institution that serves to facilitate the flow of payment traffic. Therefore, banks must maintain public confidence and are required to achieve high profitability because profitability describes the success of management in generating profits.This study aims to determine the effect of economic performance factors and bank management factors seen from the financial ratios to the profitability of Bank Persero in Indonesia during the period 2007-2015. While the factor of bank management is measured through Debt to Equity Ratio (DER) as X1 and Current Ratio as X2 Economic performance factors are described by the interest rate of Bank Indonesia (BI rate) as X3 and inflation as X4. The profitability of Bank Persero is measured through Return on Assets (ROA) as Y.The object of research in this study is a banking company Persero listed in Indonesia Stock Exchange Period 2007-2015 (9 years). Where the analytical tool used is multiple linear regression analysis.Result of research indicate factor of economic performance, BI rate have positive influence and not significant to ROA. Similarly, inflation shows a positive and insignificant effect on ROA.While the bank management factor, DER has a negative and significant influence on ROA. While Current Ratio have negative effect and not significant to ROA

This chapter provides an overview of the financial systems of the Gulf Cooperation Council countries: Saudi Arabia, United Arab Emirates, Bahrain, Kuwait, Oman and Qatar. It covers the development of individual GCC countries’ banking systems and financial markets, an analysis of the performance of Gulf banks, and briefly outlines recent moves to create a GCC economic and financial union. In general these countries have experienced various financial reforms aimed at strengthening their financial systems. These have mainly included moves to deregulate as well as to improve prudential standards. Stock markets have been upgraded and they have begun to play a wider role in financing various economic sectors within their respective countries, although their importance remains limited. Commercial banks still dominate GCC financial systems and banking systems are highly concentrated. Gulf banking systems show favourable improvement in terms of their asset quality, capital adequacy and profitability during the 1990s. Such indicators reflect an enhanced role for financial intermediaries in the process of economic growth and exhibit the positive impact of economic and financial reforms undertaken in these countries. Furthermore, from earlier analysis we know that financial systems have deepened in these countries and the proportion of credit allocated to the private sector as a percentage of GDP has increased, suggesting that banks have become more efficient in allocating financial resources within the respective countries.

This paper has attempted to examine the impacts of competition policy reforms on the efficiency of the Philippine commercial banking system. It uses the stochastic frontier approach to come up with estimates of profit efficiency and cost inefficiency measures. The results are quite interesting. First, the average measured profit efficiency is 0.85, implying that on the average the commercial banks are using only 85 percent of their resources efficiently compared to the best practice commercial bank in the system producing the same output and facing the same conditions. On the other hand, the average measured cost inefficiency of the commercial banks is 1.39, suggesting that, on average, 39 percent of the commercial bank’s costs are wasted relative to the best-practice commercial bank in the system producing the same output and facing the same conditions. Second, some improvements in banks’ profit and cost efficiency can be observed after the liberalization of the entry of foreign banks in 1994, but these improvements were halted when the East Asian financial crisis occurred. Some improvements in profit and cost efficiency can again be observed after the passage of the General Banking Law in 2000 that liberalized further the entry of foreign banks. Third, small banks are found to be more profit and cost efficient than large banks. Fourth, foreign banks are generally more profit and cost efficient than domestic banks. However, these differences widen during crisis period and narrow during stable economic conditions. Fifth, profit efficiency of merged banks dropped more sharply than nonmerged banks after 1998, but eventually recovered and approximated that of nonmerged banks in 2002. Also, merged banks’ cost inefficiency dropped sharply in 2000 and since then has remained much lower than that of nonmerged banks. Sixth, some factors, such as agency problem, governance and market characteristics appear to be significantly correlated with measured efficiencies of banks._x000D_ These results have important policy implications. First, the liberalization of the banking system has generally produced positive results in terms of improving profit and cost efficiencies of banks. Second, improvement in profit and cost efficiencies of domestic banks brought about by greater competition cannot be sustained unless it is accompanied by improvement in prudential regulations and supervision. Third, M&A policy pursued by the Bangko_x000D_ Sentral ng Pilipinas appears to be complementary policy for improving profit and cost efficiencies of banks._x000D_ Fourth, understanding the nature and extent of the impact of some correlates of measured efficiencies can help_x000D_ authorities in designing appropriate regulatory and supervisory framework for banks.

The article is dedicated to changes in the cultural atitude of Polish society towards the banking sector under the conditions of progressing fi nancialization and arising consequences for the banking sector. First of all, atiention is focused on the cultural characteristics of Poles, their atitude towards fi nance, especially in the period of transition. The main reference to cultural conditions relates to the tendency to save, incur loans, and the atitude towards banks. It is complemented, among other things, by the model of cultural dimensions by G. Hofstede andS. Schwartz, in line with which atiempts are made to explain the mechanisms shaping the fi nancial (banking) system and the fi nancializa? on tendency. This picture is confronted with the present shape and evolution of the Polish banking sector since 1989, including the role of foreign capital. In particular, atention is focused on the image of banks towards challenges related to the global fi nancial crisis and the main problem of Polish banking institutions, namely household mortgage debt in foreign currencies. The author presents a thesis that signifi cant fi nancialization cannot be indicated in Poland and the historical and cultural aspects do not cause its expansion to the same degree as in a number of other countries. However, certain features, such as preference for loans rather than savings, are favorable for this direction.