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.

Financial conglomerates and bank competition play a significant role in developing efficiency levels and increased risk exposure. This study aims to formulate a conceptual model of the policy’s impact of financial conglomerates and bank competition on bank efficiency and stability risk. This research is conducted using data samples from 90 commercial banks in Indonesia from 2010 to 2017. The empirical analysis is carried out using the dynamic data panel or Generalized Method of Moments (GMM). The study results show that policies of financial conglomerates and competition have a positive effect on banking efficiency. These results support previous empirical studies, where financial conglomeration, in general, can improve banking efficiency. Furthermore, it is found that the interaction between financial conglomerates and competition has a positive effect on banking stability. The implication of this research shows that the potential risks that cause distortion become irrelevant when the banking structure is more competitive. Furthermore, this study recommends the need to build the ideal financial conglomerate institutional structure to strengthen and encourage the role of more competitive banks.

Efficient banking solutions are an integral part of the business integration of South African and Nigerian economies as the two largest economies in the continent. Security, effectiveness, and integration of banking systems are critical to the sustainable development of the African continent. Therefore, an empirical analysis of the production of research on banking services and systems was conducted. The aim of the study was to examine the robustness of the research findings on banking systems in terms of their importance for the economic sustainability of the continent in the era of the fourth industrial revolution. The study adopted a bibliometric analysis using software clusters to visualize the results. Due to higher visibility of outputs and likely citations, the results showed that the key terms from Google Scholar are ranked higher than outputs from Scopus. Main research interests were related to internet banking (f = 70), e-payment systems (f = 57), telephone banking (f = 56), automated teller machines (f = 54), and mobile banking (f = 40). The results also showed a very low research interest in the technical aspect of online banking services such as security (f = 19, TLS = 40), authentication (f = 17, TLS =33), network security (f =13, TLS = 33), computer crime (f = 16, TLS = 42), and online banking (f = 11, TLS =32). The study found there were insufficient outputs in the area of the fourth industrial revolution (4IR) and banking services in Africa. Future research trends should examine the impact of the 4IR and big data on the banking system, regional economic integration, and sustainable growth in the continent.

This article aims to measure the level of voluntary disclosure in the published annual reports of Yemeni Islamic banks. Four full-fledged Islamic banks from Yemen are selected for the current study. A disclosure checklist covering 266 items is prepared and a 10-year period, 2005–2014, is taken. The disclosure index items were classified into seven groups, such as basic information on Islamic banks, financial ratios, corporate governance information, financial statements data, corporate social disclosure, Zakat information, and other information that has been taken as an important attribute of voluntary disclosure. The obtained results show that the amount of voluntary disclosure that Yemeni Islamic banking institutions publish in their annual reports has gradually increased over the ten years examined. The results revealed that the highest average disclosure index score over the ten years was achieved by Tadhamon Islamic International Bank (TIIB), the second highest average disclosure score was obtained by Saba Islamic Bank (SIB), and the lowest average voluntary disclosure rating score during the ten years surveyed was achieved by Shamil Bank of Yemen & Bahrain in Yemen during the study period. Substantially, the result of voluntary disclosure scores indicates that the degree of voluntary disclosure by Yemeni Islamic financial institutions has relatively expanded during the ten years investigated. The findings provide new evidence for voluntary disclosure, particularly, Islamic disclosure items. The survey findings can be useful for regulators in Yemen to improve overall disclosure practices by Islamic banks operating in Yemen.

This research aims to enrich the literature on the threatening topic of Target2 imbalances in the euro area. Using a quantitative time series analysis, the paper examines and discusses the development of Target2 imbalances and the interrelationships of the European Central Bank (ECB) activities through market intervention using quantitative easing. This paper outlines the scope of central bank activities in different Eurozone countries and examines how individual debtor and creditor countries, as well as central banks, will continue to operate. In this context it examines whether the ECB is working on a problem solution, and what are the risks posed by Target2 imbalances for the euro area, as well as whether the euro is volatile and how the Target2 imbalances will be managed if the euro breaks. This research highlights the ambiguity of central bank activities, explains the burdens and risks of Germany as the largest creditor, shows solutions through the communitization or the creation of Target3 to correct past mistakes and to prevent a further and more severe global crisis. Attention is drawn to the fact that Italy could put the Eurozone in a critical situation by introducing mini-BOTs (small government bonds; “titoli di Stato di piccolo taglio”) as the second currency. Furthermore, it is pointed out that the ECB has adjusted its price stability objectives to raise inflation expectations in the Eurozone, which is unlikely to satisfy Target2 demanding countries.

Lending to long-term investment projects in fragile countries requires additional financial instruments to control the sustainability of project cash flows and to increase the borrower’s financial discipline in debt servicing. This paper analyzes the special aspects of using financial covenants as credit risk mitigation instruments in project financing in Ukraine. It also argues that regulatory requirements to maintain financial strength indicators at the appropriate level have an indirect impact on the change in project finance loan rates. The study primarily aims at developing approaches to defining a credit rate corridor for an investment project, depending on changes in the values of financial sustainability indicators. The implementation of the proposed approach allows increasing the validity of credit risk components for investors and optimizing capital value for borrowers.As required by international practice, violation of covenant terms is the trigger for satisfying the creditors’ claims. According to the authors’ conclusions, the use of financial covenants as a tool for protecting the creditors’ interests should not be an instrument of unreasonable financial pressure on borrowers. The study reveals benefits and drawbacks of using financial covenants to mitigate credit risk and reduce the probability of a borrower default in the field of project financing in Ukraine.

The implementation of the 2004–2005 bank capital reform in Nigeria, introduced to deepen the financial capacity of the banking system, has led to a major restructuring of the banking sector. The reform required banks to increase their equity capital by about 1150 per cent (from two billion to twenty-five billion naira) within 18 months. Due to compliance challenges, the reform formed just twenty-five out of eighty-nine banks that previously existed. More than seventy-five per cent of the banks emerged through mergers and acquisitions. However, despite the massive increase in assets and deposit growth, episodes of bank distress have remained a recurring irritant in the country’s financial system. This study compares bank performance in the pre- and post-reform periods to determine the usefulness or efficacy of the capital reform in boosting bank performance based on panel analysis of data from five banks. The study covered the period 1996–2016. The generalized method of moments was used to evaluate the parameters of the model. The result of the random effects model shows a weak positive effect of total assets and deposit growth on bank performance in the pre-reform period. However, the post-reform assessment reveals that while profitability is significantly low in large-sized banks, it is higher in smaller banks. Given the above evidence, the study asserts that profit performance of banks is substantially linked to restructuring of the sector.

When choosing online financial transactions, security is a paramount concern of users. Three categories of banks in India, namely public, private and foreign banks, have a completely different focus on technology and capabilities. The study aims at investigating e-banking users’ perception with regard to online risk for public, private and foreign banks. Online risk perception for the abovementioned banks was assessed on three major risk parameters, i.e. security aspect, privacy aspect, and trust; using a multiple-criteria decision-making tool, called the Analytical Hierarchy Process (AHP). The outcomes indicate that security risk is paramount among various aspects of perceived risk, followed by privacy and trust concern. Moreover, public sector banks are perceived to be the safest in this aspect. Public sector banks are also considered to be benign in terms of privacy and trust. Given the general user’s perception of risk generated by all the three risk parameters taken together, public sector banks are perceived to be the most secure, followed by private and foreign banks. The findings of this study have various implications for both research and practice. Private and foreign banks in India may adopt appropriate marketing strategies to achieve a favorable perception. Various studies have been conducted earlier on these factors and their interrelationship, but limited research has been carried out to demonstrate the importance of each of these factors in relation to the other as perceived by the user. Moreover, the study quantifies factors in order of their importance.

The study aims to explore the effect of the quality of state-owned sharia banks’ services on consumers’ satisfaction and happiness. It contributes to knowledge of marketing management theory and management practices. The expected final effect is that the right quality of customers` service practice can increase customers’ satisfaction and happiness in the Islamic context. The study uses quantitative approach. It relies on primary data obtained from questionnaire results and secondary data in the form of information from state-owned sharia banks including Bank BRI Syariah, Bank BNI Syariah and Bank Syariah Mandiri. The study considers PLS-SEM as the right tool for data analysis. The findings of the study are as follows: 1) only two of seven dimensions of service quality that significantly affect consumers’ satisfaction, are the Islamic Service System and the Responsiveness System, while the remaining effects come from other hypotheses not included in the model; 2) consumers’ satisfaction has a significant effect on consumers` happiness, and the remaining effects come from other concepts that are worth exploring.

The aim of this study is to analyze the influence of the non-performing financing (NPF), financing to deposit ratio (FDR), operational efficiency ratio (OER), and firm size (SIZE) on return on assets (ROA). The object of the research is the Islamic bank in Indonesia and the Islamic bank in Malaysia for the period of 2010–2015. Another aim of this research is to determine if there are differences in the impact of FDR, NPF, OER and firm size on ROA between the Islamic bank in Indonesia and the Islamic bank in Malaysia. The findings show that not all studied independent variables affect the ROA of the Indonesian Islamic Bank and the Malaysian Islamic bank. OER has a negative and significant effect on the Indonesian Islamic Bank’s ROA, while FDR and size have a positive and significant influence on the Indonesian Islamic Bank’s ROA. In the Islamic bank of Malaysia, NPF affects ROA positively, while OER affects ROA negatively. In the Indonesian Islamic bank, independent variables that influence ROA are FDR, OER, and SIZE. In Malaysian Islamic bank, only OER influences ROA significantly. Based on the Chow test, one can conclude that there is a significant difference between the Indonesian Islamic bank and the Malaysian Islamic bank. Regarding operational costs, banks should pay more attention to validation of the costs to be incurred, so there is no need to spend unnecessary costs.