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The motivation for this research was the need for scientific elaboration on the issues of managing the flexibility of the financial system to ensure its sustainable development. The purpose of the article is to develop a counter-cyclical approach to change management in banks for the sustainable development of the financial system. Based on data of 2020 and post-crisis economic recovery in 2021, the article reveals the positive effect of managing changes in banks in the form of sustainable development of the financial system. Alternative scenarios for managing changes in banks are compared in terms of advantages to enhance the resilience of the financial system. This serves as a justification for the fact that the contribution of banks' flexibility to this positive effect varies significantly depending on the phases of the economic cycle. The authors' SAP-LAP model has provided a qualitative interpretation of change management in banks in the context of the economic crisis to enhance the resilience of the financial system on the example of the credit services market. The theoretical impact consists in revealing the status quo that determine the flexibility of banks and their contribution to the sustainable development of the financial system. These conditions are the development of mobile money services and the expansion of ATM network, as well as specialization in the segments of the richest 60% and the poorest 40% of consumers of credit services. The practical significance of the results obtained in the article is that the developed new approach to the organization of banks' activities makes it possible to increase the flexibility of banks and thereby enhance their adaptability to the cyclical economy. [ABSTRACT FROM AUTHOR]

We test whether organizational risk management matters to bondholders of U.S. bank holding companies (BHCs), and find that debt financing costs increase when the BHC has lower-quality risk management. Consistent with bailouts giving rise to moral hazard among bank creditors, we find that bondholders put less emphasis on risk management in large institutions for which bailouts are expected ex-ante. BHCs that maintained strong risk management before the financial crisis had lower debt costs during and after the crisis, compared to other banks. Overall, quality risk management can curtail risk exposures at BHCs and result in lower debt costs. [ABSTRACT FROM AUTHOR]

Fulfilling the international considerations of environment, societal, and governance challenges, the financial industry, especially banks, has initiated "Go Green" practices to help sustain the environment and enhance "banking" across the globe. Amidst the green and climate-friendly drives, there is scarce literature highlighting the banks' green practices, environmental awareness, and their effects on bank reputation, especially the reputation of Islamic banks. This study aims to investigate the green banking practices of Islamic banks in a developing Islamic country. Focusing on the greening ambitions of banks, this study argues that the reputation of Islamic banks can be better enhanced through adopting green banking initiatives that will beget better climatic outcomes in Muslim societies. Therefore, the study illumes green banking practices and their impact on the reputation of Islamic banks in Pakistan. Moreover, this study checks the moderation effect of employees' environmental awareness on banks' reputation. The study used deductive rationale and quantified the employees' data to unravel their go-green perceptions and bank green activities. In this regard, the 390 response data, collected through a survey from the employees of Islamic banks, were analyzed through Smart-PLS, using structural equation modeling technique. The study finds that banks' employees-related practices (ERPs), daily operations-related practices (DORPs), customers-related practices (CRPs), and banks' policy-related practices (PRPs) have a significant positive influence on bank reputation. The authors also find that there is a significant moderating impact of environmental awareness between the relationships of ERPs, DORPs, CRPs, PRPs, and bank reputation. The study might increase understating and enlighten regulators and bank management to sustainably transform their operations to green banking practices, particularly adding to the environmental sustainability in Pakistan. [ABSTRACT FROM AUTHOR]

This study aims to understand and evaluate the impact of applying governance principles on digital transformation in Palestinian banks listed on the Palestine Stock Exchange. A questionnaire was distributed to 750 employees from the study population. It included four axes representing governance principles (board of directors' tasks, board practices and conflicts of interest, disclosure and transparency, and risk management) and a fifth axe representing digital transformation. The study found a strong, statistically significant positive effect of applying governance principles on digital transformation in Palestinian banks. The results also showed the keenness of the boards of directors to discuss the commitment of bank management to implement the provisions and regulations of governance issued by the Palestine Monetary Authority. This helped in developing and approving the necessary policies for risk management and enhanced the effectiveness of oversight of the digital transformation system. This was reflected in increasing customer confidence in the banks' performance and maintaining the interests of related parties. The study recommended the need to enhance the level of transparency and disclosure regarding governance performance and the progress of digital transformation in banks. It also recommended developing an integrated framework for analyzing and managing risks related to digital transformation. This assists in providing comprehensive training and development programs for practitioners to enhance their capabilities in the field of digital transformation and applying governance principles. [ABSTRACT FROM AUTHOR]

This study proposes an optimisation-based "benefit-of-the-doubt" (BoD) methodological framework for developing a new multidimensional index of bank stability. The proposed index has the ability to serve as a potent policy tool that overcomes the downsides of accounting- and market-based measures of bank stability. This data-driven approach generates endogenous weights for aggregating bank stability indicators and dimensions. Further, we integrate the BoD framework with a metafrontier approach, which we call a "meta-BoD framework". The final outcomes of the suggested framework go beyond a scalar measure of bank stability and provide the unique weighting matrix that offers valuable policy-relevant insights about the most precarious areas of stability that require the attention of management and regulators for both micro- and macro-level policy interventions. In addition, it draws insightful information about the instability gaps across heterogenous bank groups. The study presents an illustrative example of the proposed framework to obtain a bank stability index using the dataset of 76 Indian banks operating between 2014 and 2018. The bank stability index is made up of 14 financial ratio indicators covering five dimensions of stability: asset quality, management efficiency, capital adequacy, profitability and liquidity. The findings offer the detailed information required for comprehending the evolution of bank stability and assessing instability gaps across bank groups. [ABSTRACT FROM AUTHOR]

Working capital management is an important financial management decision for the profitability of commercial banks. The purpose of this study is to examine the impact of working capital management on commercial banks' profitability. The study used secondary data from audited financial statements of five private commercial banks in Ethiopia covering the period from 2011 to 2020. The banks were selected on a convenience basis. The financial information from the banks was analyzed to determine the impact of the current ratio, bank size, a current asset-to-total asset ratio, loans and advances to total asset ratio, and current liabilities-to-total assets ratios on profitability. The researchers applied descriptive statistics and inferential statistics. The data were analyzed using the Stata data processing package. An econometric model is applied to examine the impact of working capital management on the profitability of commercial banks. A random effect model was employed and the result revealed that bank size and loans and advances to total assets were found to have a significant impact on banks' profitability. The current ratio, a current asset-to-total asset ratio, and current liabilities-to-total assets ratios were found insignificant to influence banks' profitability. Since the profitability of the banks depends on working capital management, rigorous attention should be given to those factors that influence the profitability of commercial banks. [ABSTRACT FROM AUTHOR]

The purpose of the study was to identify the factors that influence senior management for adopting blockchain technology in the banking industry in general and Islamic banking in particular. Furthermore, the research addressed the moderating role of technological turbulence as it holds a significant hindering role. This study employed the analytical approach, and the data were collected through questionnaires distributed to several senior management employees in both the Jordan Islamic Bank and the Islamic Arab Bank. The research instrument was developed and confirmed by the experts in the field. For identifying the significance of the variables incorporated in the researchers applied structural equation modeling technique. The findings revealed that economic efficiency, bank security, customer expectations, education, training and preparation all are significant predictors of readiness for implementing blockchain technology in the Islamic banks in Jordan. The study concluded that blockchain technology should be adopted by all Islamic banks because of its advantages and also the management needs to be educated regarding the same; they should be provided appropriate training. [ABSTRACT FROM AUTHOR]

Addressing recent calls by European regulatory and supervisory authorities, we develop a new bottom-up climate risk assessment method to examine the resilience of the European banking industry regarding transitory climate risks. We illustrate our approach by estimating the impact of a 50–100 EUR carbon tax per tCO 2 equivalent on the valuation and default risk of STOXX Europe 600 firms. For about 5% of the sample firms, we find asset devaluation shocks larger than 30% and for about 16% of the firms probabilities of default (PDs) dropping below investment-grade level of 3%. At the sector level, our results yield asset devaluations shocks of 15–36% and new PDs of 5–34% for the six most affected sectors. Running a stress test on credit risk based on these results, we find a decrease in capital ratios between - 1.2 and - 1.6 percentage points for key regulatory capital ratios in the most adverse scenario while only addressing 36% of the bank's total risk-weighted assets. Our analysis sheds light on the substantial transitory climate risk for asset portfolios of banks and contributes to the pressing question how to integrate climate risk into risk management and regulation of financial institutions. [ABSTRACT FROM AUTHOR]

This study aims to evaluate the impact of utilization of self-service cash deposit machines (SSCDMs) on the financial performance of Tanzanian commercial banks, focusing on key parameters like capital adequacy, asset quality, management quality, earning ability, and liquidity. The research, conducted over six years (2017–2022), utilizes a CAMEL analysis and combines secondary data review with primary data collected through interviews. Four commercial banks' audited financial statements serve as the primary data source. The findings indicate a mixed impact of SSCDM utilization on bank performance, with some banks experiencing positive effects on capital adequacy and liquidity ratios, while others show performance fluctuations. Overall, SSCDMs are found to enhance operational efficiency and convenience, attracting more customers and increasing deposit volumes. However, potential liquidity management challenges are noted. This study contributes valuable insights to the evolving Tanzanian banking sector, aiding policymakers and bank management in informed decision-making regarding self-service banking technologies. [ABSTRACT FROM AUTHOR]

The research investigates the determinants of private banks profitability in Egypt. The determinants are bank specific (liquidity, capital adequacy, bank size, asset structure, credit risk, and non-performing loans), industry-specific (industry concentration and banking industry development), and macroeconomics (economic growth and inflation). It is an empirical study applying a quantitative method for data analysis and the type of data is secondary data. The sample size of the research is 15 private banks on the Egyptian and the panel data for the research is 2013–2022. The multiple linear regression analysis using the Eviews 12 application as an analytical tool by applying generalized least squares model. The profitability of private banks, which is the dependent factor, is calculated by two measurements, Return on Assets and Return on Equity with ten determinants of profitability as independent variables. Results indicate that capital adequacy, economic growth bank size, and inflation has a positive significant effect on private banks profitability in Egypt. While NPL, liquidity and credit risk have significant negative effect on private banks profitability in Egypt. Based on the results recommendations are provided for bank management to maximize their profitability. [ABSTRACT FROM AUTHOR]

The central concept of strategic benchmarking is resource management efficiency, which ultimately results in profitability. However, little is known about performance measurement from resource-based perspectives. This study uses the data envelopment analysis (DEA) model with a dynamic network structure to measure the resource management and profitability efficiencies of 287 US commercial banks from 2010 to 2020. Furthermore, we provide frontier projections and incorporate five variables, namely capital adequacy, asset quality, management quality, earning ability, and liquidity (i.e., the CAMEL ratings). The results revealed that the room for improvement in bank performance is 55.4%. In addition, we found that the CAMEL ratings of efficient banks are generally higher than those of inefficient banks, and management quality, earnings quality, and liquidity ratios positively contribute to bank performance. Moreover, big banks are generally more efficient than small banks. Overall, this study continues the current heated debate on performance measurement in the banking industry, with a particular focus on the DEA application to answer the fundamental question of why resource management efficiency reflects benchmark firms and provides insights into how efficient management of CAMEL ratings would help in improving their performance. [ABSTRACT FROM AUTHOR]

Motivated by the debate about the introduction of the fair value option for (financial) liabilities (FVOL) and the requirement to recognize and separately disclose in financial statements debt valuation adjustments (DVAs), this study explores what we can learn about a firm's credit risk from DVAs. Using a sample of US bank holding companies that elect the FVOL, we show that DVAs generally cannot be explained by the same factors that explain contemporaneous changes in bank's credit quality. We further find that DVAs can explain future changes in credit risk when the fair value of liabilities is based on managerial inputs (Level 3). Overall our results suggest that managers have an information advantage in estimating credit risk and that DVAs provide inside information to the market. [ABSTRACT FROM AUTHOR]

Digital transformation (DT) is a strategic priority for commercial banks in China. It is important to explore the relationship between DT and bank systemic risk to maintain financial stability and promote high-quality development of banks. Based on the data of China's listed commercial banks from Q3 2010 to Q1 2022, this paper empirically tests the influence mechanism, heterogeneity influence and action channels of DT on bank systemic risk. This paper finds that DT reduces the bank systemic risk. The higher the degree of DT, the lower the bank systemic risk. Innovation effect and cost effect play multiple mediating roles in the reduction of bank systemic risk by DT. The innovation of bank products, sales channels, organizations and other aspects to enhance the competitiveness and income of banks, while reducing the information asymmetry between the supply chain and the industrial chain, taking cost and risk sharing, reduces the bank systemic risk. This paper enriches the research on the impact of bank DT on systemic risk and provides empirical support for bank risk management. [ABSTRACT FROM AUTHOR]

In the modern banking industry, investment in information technology (IT) is crucial to maintain technological advances, operational efficiency, financial innovation, and security. However, the impact of IT investment on the banking sector is still in question, particularly whether it follows a linear or nonlinear relationship, and what should be the optimal level of IT investment. This study investigates the nonlinear and threshold effects of IT investment on bank profitability, stability, and efficiency. We use data from 28 Bangladeshi banks from 2015 to 2020 and use panel models, including static and dynamic models, with quadratic function and dynamic panel threshold regression for analysis. The study reveals that IT investment has a U-shaped nonlinear relationship with bank profitability and stability, indicating that an optimal level of IT investment exists for both factors. In contrast, the relationship between IT investment and bank efficiency is an inverted U-shape, suggesting that, though IT investment can lead to greater efficiency gains, excessive IT investment can become counterproductive. Dynamic threshold regression analysis indicates that the threshold point for IT investment is 15.369, 16.774, and 17.370 for bank profitability, stability, and efficiency, respectively. These findings can serve as useful benchmarks for bank management, policymakers, and regulators to determine the optimal level of IT investment that maximizes the benefits while minimizing costs. [ABSTRACT FROM AUTHOR]

What is the impact of policy interventions on the systemic risk of banks? To answer this question, we analyze a comprehensive sample that combines an original set of bank-specific bailout events with the balance sheets of key affected and nonaffected European banks between 2005 and 2014. We find a positive and significant association of guarantees with systemic risk that is somewhat weaker in the long run when the regulator appoints members to the supervisory board. The short run association between recapitalizations and systemic risk is also positive for large and less capitalized banks, while in the long run, recapitalizations are linked with reduced systemic importance, especially for less profitable banks and in cases when the regulator limits management pay. Liquidity injections are positively linked with systemic risk, but the long-run effect is mitigated for small or better capitalized banks. In the short run, injecting liquidity is associated with reduced systemic risk when the regulator imposes restrictions on supervisory board composition or on management pay or capital payouts. [ABSTRACT FROM AUTHOR]

Banks play a vital role in the economy, so their productivity and performance should be analyzed through efficient methods. This study aims to investigate the banks' productivity and their relationship with governance. Malmquist productivity index, a non-parametric method was used to measure the productivity of Indian banks. Further banks were classified into the large bank and small bank categories. Productivity analysis of Indian banks was studied in four different sub-periods of its development from 2000 to 2019 making robust outcomes. Historical data from the year 2000–2019 is used to reveal pre-recession and post-recession outcomes. The empirical results show that the average productivity of Indian banks has increased at a rate of 1.2% per annum. 2001 was the most efficient year whereas 2003 was the least efficient year. Multilinear regression was used to find the relationship between productivity and governance. The research outcomes show that the productivity of the large banks is significantly influenced by women on board while the audit committee meeting influences the productivity of small banks. The study provides the researchers, academicians, management of the banks, and regulatory body a new insight into how corporate governance influences the banks' productivity so that they can formulate a better policy to generate more productivity. [ABSTRACT FROM AUTHOR]

Over the past two decades, the financial and economic landscape has been significantly influenced by various periods of turmoil, including the Internet bubble, financialisation of commodities markets, the subprime crisis, sovereign debt crises, geopolitical crises, the COVID-19 crisis, and recently the invasion of Ukraine. The first study by Kais Tissaoui, Taha Zaghdoudi, Abdelaziz Hakimi, and Mariem Nsaibi titled "Do a gas price and uncertainty index forecast crude oil prices? Interestingly, the aim of this study is to investigate the forecasting capabilities of gas prices as well as the uncertainty of crude oil prices. [Extracted from the article]

This paper examines the impact of organizational culture on bank stability. We rely on the Competing Values Framework (CVF) to identify the four cultural dimensions of banks, namely Control, Collaborate, Compete and Create cultures. Using the textual analysis technique and banks' annual reports, we obtain organizational culture values in conjunction with the CVF for a large sample of US-listed banks from 1994 to 2020. We find that banks with cultures leaning toward consistency, monitoring, and control practices (i.e., Control-oriented and Compete-oriented cultures) exhibit a higher level of stability. Additional analyses show that Control-oriented banks have higher asset quality and are less risky, whereas Compete-oriented banks have higher asset quality and better financial performance. We also find that the impact of culture on bank stability is more pronounced during "non-crisis" periods and is more prominent for small and medium-sized banks. [ABSTRACT FROM AUTHOR]

It is very much fundamental to identify the susceptibility of river bank materials to erosion for implementing management strategies. The present paper intends to find out the susceptibility of river bank materials to erosion and it also focuses on vulnerability assessment based on susceptibility of river bank materials to erosion. A vulnerability assessment model based on susceptibility of river bank material to erosion has been used in this study. To satisfy the objectives of this study, a stretch of river Ganga-Bhagirathi in Jangipur sub-division under the district of Murshidabad has been selected. The results of the study show that aggregate stability of the soil in study area is less than 10% and the percentage of aggregated clay (less than 8%) and organic matter (less than 0.5%) in the soil are also very less. The areas categorized as high susceptibility to erosion are highly vulnerable than the rest. [ABSTRACT FROM AUTHOR]

Credit card churn prediction, insurance fraud detection, and loan default prediction are all critical analytical customer relationship management (ACRM) problems. Since these events occur infrequently, datasets for these problems are highly unbalanced. Consequently, when trained on such unbalanced datasets, all machine learning classifiers tend to produce high false positive rates. We propose two methods for data balancing. To oversample the minority class, we proposed an innovative GAN called chaoticGAN, where we employed chaotic noise as input for the generator. We also employed the traditional GAN (Goodfellow et al. in Adv Neural Inf Process Syst, 2014. https://doi.org/10.1145/3422622), Wasserstein GAN (Arjovsky et al. in Wasserstein GAN, 2017. https://arxiv.org/abs/1701.07875), and CTGAN (Xu et al. in Modeling Tabular Data using Conditional GAN. https://arxiv.org/pdf/1907.00503) independently for baseline comparison. On the data balanced by GANs, we employed a host of machine learning classifiers, including Random Forest, Decision Tree, Support Vector Machine (SVM), Logistic Regression (LR), multi-layer perceptron (MLP) and Light gradient boosting machine (LGBM) to demonstrate the efficacy of our approaches. In the second approach, we augment the oversampled synthetic minority class data obtained by GAN and its variants with the undersampled majority class data obtained by one class support vector machine (OCSVM) (Tax et al. in Mach Learn 54:45–66, 2014). We passed the entire modified dataset to build the classifiers. Our proposed approaches outperform earlier studies on the same datasets in terms of the area under the ROC curve (AUC). Further, our proposed chaoticGAN and its hybrid turned out to be statistically similar to the state-of-the-art CTGAN on all datasets while being significant over other methods w.r.t AUC over tenfold cross-validation. [ABSTRACT FROM AUTHOR]

Based on stakeholders' theory, our paper investigates the relationship between customer complaints and bank performance. We use a unique hand-collected database of customer complaints published by the banking and financial ombudsman and the financial data of the universe of Italian banks during the 2010–2017 period and employ a fixed effect panel data model and two-step system GMM estimation. We first confirm that higher complaints scaled by bank size reduce profitability and increase bank risk. Then, we show that bank institutional form affects this outcome. In contrast to cooperative banks, the performance of commercial banks is negatively influenced by customer complaints. Moreover, in contrast to medium and large banks, small banks' profitability is not affected by customer complaints. We also found that a bank's decision to settle customer complaints has a positive impact in the long run. The results are consistent when using normalized variables for size and different robustness checks. Consequently, managerial and policy implications related to customer complaints are proposed. Indeed, commercial banks must protect relational capital with customers by strengthening dialogue among the compliance function, complaints office and commercial areas to proactively manage the risk of complaints and improve performance. Policy makers should enhance banking transparency and simultaneously promote greater financial education of clients, which can foster trust in banks and their stability. [ABSTRACT FROM AUTHOR]

Digital innovation is challenging the traditional way of offering financial services to companies; the so-called Fintech phenomenon refers to startups that use the latest technologies to offer innovative financial services. Within the framework of the Theory of Planned Behavior (TPB) and the Theory of Reasoned Action (TRA), the primary purpose of this paper is to develop a causal-predictive analysis of the relationship between Subjective Norms, Attitudes, and Perceived Behavioral Control with the Intention to Use and Behavioral Use of the Fintech services by companies. Partial Least Squares Structural Equation Modeling methodology was used with data collected from a survey of 300 companies. Our findings support the TRA and TPB models and confirm their robustness in predicting companies' intention and use of Fintech services. Financial technology innovators must understand the processes involved in users' adoption to design sound strategies that increase the viability of their services. Studying the antecedents of behavioral intention to adopt Fintech services can greatly help understand the pace of adoption, allowing these players to attract and retain customers better. This study contributes to the literature by formulating and validating TPB to predict Fintech adoption, and its findings provide useful information for banks and Fintech companies and lead to an improvement in organizational performance management in formulating marketing strategies. [ABSTRACT FROM AUTHOR]

Cloud applications are becoming central and critical to the delivery of financial services. Despite their significance, banks face increased exposure to transaction risks related to the use of cloud services and internal and external pressures to improve their risk management practices. In this study, we use a unique data set from a bank's cloud register to examine the effectiveness of internal governance on an ongoing cloud outsourcing transaction between a bank and cloud service provider. We employ structural equation modeling and a simple linear regression to test for transaction misalignment and causes of governance inefficiencies. We find that a strong degree of misalignment is largely due to poor design of internal controls and a weak control system that does not provide acceptable indications of residual risk likelihood. The findings indicate that cloud risks are driven not only by agency costs, but also by firm-specific risks which contribute to a number of transaction uncertainties and governance misalignment. [ABSTRACT FROM AUTHOR]

Prudential regulation has become increasingly important over time. In such a context, strict suitability requirements for members of the management body and key function holders are considered an adequate tool to safeguard the sound and prudent management of banks. In the years following the Great Financial Crisis in 2008–2009 and the Eurozone sovereign debt crisis in 2010–2012, the regulatory and supervisory approach to banks' corporate governance has seen a significant evolution. The centralisation of banking supervision at the Eurozone level was complemented by the application of a single rulebook throughout the European Union which stated, in compliance with the Capital Requirements Directive, higher suitability requirements for being appointed as a member of a management body or as a key function holder at a bank. Furthermore, the choice to identify fit and proper requirements through standards attributes significant power to the decision maker, thus allowing greater public control over private choices, and is justified by the need to prevent negative externalities. This approach is open to debate. Against the background of the pursuit of public interest, the lawmaker confers discretionary power on the supervisory authorities (the European Central Bank and the national competent authorities), and sets restrictions on the job market for board member candidates. This paper is a contribution enriching the ongoing discussion about the existing regulatory and policy regime, with a special focus on the specific functions performed by the management body members and particularly by the chairs of the management body's special committees. [ABSTRACT FROM AUTHOR]

Due to the inherently unfavorable geological conditions coupled with various triggering factors, reservoir bank slopes often exhibit long-term and complex deformation processes with multiple accelerating phases, which poses constant threats to the safe operations of hydropower stations, as well as the safety of the residents, houses, and infrastructures both upstream and downstream of the reservoirs. In this study, the quantile regression has been used to develop a fundamental tool for the prediction and early warning of this type of complex slope deformation. The application of this tool is illustrated in the case study of the Duonuo near-dam slope at Baishui River in China. Quantile regression can estimate the parameters of the prediction model, such as the Fukui–Okubo model used in this study, based on different quantile levels. This enables the predictive uncertainty to be quantified and obtain a possible failure-time horizon. Further, two indicators, i.e., the reliability indicator and the strength indicator, have been defined to aggregate the predictive information of the quantile regression. As such, the reliability and intensity of failure precursory signals associated with the accelerating behavior can be diagnosed. Finally, a probabilistic warning indicator has been proposed to establish an early warning procedure, which can measure the risk levels of a slope failure in real time. Two case studies, i.e., the Duonuo slope and the Vajont landslide, have been used to verify the effectiveness of the proposed early warning indicator. Thus, the tool developed in this study provides valuable references for predictive decision-making and disaster management of reservoir bank slopes. It can also easily be transferred to unstable slopes with similar evolution characteristics in other hazardous areas. Highlights: A new prediction approach using quantile regression and Fukui–Okubo model is proposed for reservoir bank slope failure. A failure time window is used to quantify predictive uncertainty in a reservoir bank slope failure prediction. Two indicators are developed for precursory diagnosis of reservoir bank slope failure. A dimensionless indicator for early warning of reservoir bank slope failure is proposed. [ABSTRACT FROM AUTHOR]

The control of credit risk is an important topic in the development of supply chain finance. Financial service providers should distinguish between low- and high-quality customers to predict credit risk accurately. Proper management of credit risk exposure contributes to the long-term viability and profitability of banks, systemic stability, and efficient capital allocation in the economy. Moreover, it benefits the development of supply chain finance. Supply chain finance offers convenient loan transactions that benefit all participants, including the buyer, supplier, and bank. However, poor credit risk management in supply chain finance may cause losses for finance providers and hamper the development of supply chain finance. Machine learning algorithms have significantly improved the accuracy of credit risk prediction systems in supply chain finance. However, their lack of interpretability or transparency makes decision-makers skeptical. Therefore, this study aims to improve AI transparency by ranking the importance of features influencing the decisions made by the system. This study identifies two effective algorithms, Random Forest and Gradient Boosting models, for credit risk detection. The factors that influenced the decision of the models to make them transparent are explicitly illustrated. This study also contributes to the literature on explainable credit risk detection for supply chain finance and provides practical implications for financial institutions to inform decision making. [ABSTRACT FROM AUTHOR]

This study aims to analyze institutional divergence of Beckert (2010) by measuring the reframing of three constitutive principles of Digital Weberian Bureaucracy (DWB). In contrast to the studies by Gaus et al. (2017), Sofyani et al. (2018), Muellerleile and Robertson (2018), Turner et al. (2019), and Meilani and Hardjosoekarto (2020), this study explores normative and mimetic mechanisms resulting in the mixed pattern of public administration (Traditional Public Administration (TPA), New Public Management (NPM), and Post NPM), focusing on the transformation of Digital Era Governance (DEG). Employing Soft Systems Methodology (SSM) by Reynolds and Holwell (2010), combined with Text Network Analysis (TNA) by Segev (2020) and Social Network Analysis (SNA) by Borgatti et al. (2014), this study shows the micro dynamics of relationships between actors, the meso dynamics of organizations, and the absence of regulations at the macro level, all of which lead to institutional divergence in the form of fully hybrid governance (as proposed by De Waele et al. (2015)) that is also caused by normative and mimetic mechanisms. Complementing the study of DWB, this study suggests that computer literacy and programming languages are essential to be improved by future bureaucrats as social actors to achieve the success of digital transformation. [ABSTRACT FROM AUTHOR]

Predicting bank performance is important for investors and regulatory authorities. Previous research on non-financial firms has shown that augmenting the numeric information in the financial statements with textual information from the rest of the annual reports led to a more accurate prediction of performance. The researchers have generally eschewed the use of narrative in textual disclosure for building better bank prediction models. Moreover, very few of these studies dealt with endogeneity problem that is pervasive in corporate settings. This study employed natural language processing (NLP) for extracting tone of disclosures and used it along with other financial data in the predictive models. The models were estimated using GMM to deal with the endogeneity. Our results suggested that in addition to quantitative financial information, textual data were a valuable source of additional information for predicting the future performance of banks. Moreover, dealing with endogeneity was found necessary for obtaining better predictions by leveraging textual information. [ABSTRACT FROM AUTHOR]

Blockchain technology is considered a core technology in the financial sector with promising prospects like economic development, financial innovation, and internet development. The financial sector needs digital transformation and the deployment of strategies that make Blockchain technology adoption successful. Hence, the current research investigates the mediating role of Blockchain adoption between digital business strategy and process innovation, financial performance, and the moderating role of information technology alignment. The data was collected from the 300 employees of banks located in Islamabad/Rawalpindi, Pakistan. Statistical techniques: Pearson's correlation analysis, confirmatory factor analysis, Hayes process technique for mediation, and moderation analysis were used for data analysis. The results illustrate that digital business strategy is positively related to business process innovation and firm financial performance. Blockchain adoption mediates the relationship between digital business strategy, business process innovation, and financial performance. Information technology alignment acts as a moderator between Blockchain adoption and process innovation. The current study provides theoretical contribution by extending the literature on key variables: digital strategy, Blockchain technology, and bank's performance. The study also offers various managerial implications for top management and executives in the banking industry that are responsible for strategic decision making and better firm performance. [ABSTRACT FROM AUTHOR]

To further explore the influence path of internet finance on the risk prevention and management of commercial banks, the backpropagation neural network optimization algorithm was used to predict the risk value and the change of the risk level of commercial banks under the background of internet environment was empirically studied and analyzed. The results showed that the maximum size of genetic algebra and the number of individuals significantly impacted the algorithm's optimization performance when the genetic algorithm was used for parameter optimization. Through continuous attempts, the prediction effect was the best when the genetic algebra was 62, and the individual number was 45. The training network showed that the test set's fitting degree was 96.07%, and the prediction error was 0.84%, which was much better than those before optimization. When the predicted risk value was more significant than 0.39, the bank should be vigilant and strengthen risk prevention. The development of internet finance can reduce commercial banks' business risk levels, reduce their dependence on traditional business, and decrease commercial banks' business risk levels. It can be seen that commercial banks can effectively improve risk management ability and efficiency promoted by technological development, so the level of business risk they undertake can be reduced. [ABSTRACT FROM AUTHOR]

This paper compares earnings management (EM) and capital management (CM) by Russian banks before and after changes in banking regulation and oversight in Russia. In Russia, in recent years, the Central Bank of the Russian Federation has imposed new regulations on banks. In addition, the Central Bank has strengthened its oversight by revoking the license of a large number of banks. Hence, we compare EM and CM before and after these changes in regulation and oversight. We focus on the use of loan-loss provisions (LLPs) for EM and CM. We have three main results. First, we find that banks use LLPs for EM both before and after these changes in regulation and oversight. However, banks' use of LLPs for EM is similar pre- and post-changes. Second, for the entire sample period, we find mixed evidence of the relationship between capital and LLPs. However, post-changes, the relationship between capital and LLPs is more negative relative to pre-changes. This result is consistent with stronger oversight by regulators post-changes. Third, the difference in CM post-changes relative to pre-changes is different for government-owned banks than for private banks. [ABSTRACT FROM AUTHOR]

This study has been carried out to evaluate the river shifting and assessment of related effect on the land-use/land-cover using geographic information system (GIS) and remote sensing (RS) techniques between 1955 and 2016 for Padma River at Bangladesh. Alluvium is eroding chronically due to the rushing stream flow; therefore, people of this region are poor and government loss national assets each year that reflects the direct effect on the economy. The standard topographical map of 1955 and satellite images of 1973, 1987, 1999, 2011 and 2016 were used in the study. Impact assessment on land use/land cover around 5 km from the stream centerline of 1973 was obtained. This studied has been carried out in three steps: (1) analyzed migration rate from 1955 to 1973; (2) analyzed migration rate from 1973 to 2016 and (3) assessed migration rate impact on land-use/land-cover change using GIS and RS techniques. Normalized difference of water index technique was used for identification of land and water boundary. The maximum likelihood supervised image classification was applied to detect the land-use/land-cover type and identify erosional impact with best accuracy. Results of long-term river channel migration showed that the land area is influencing with river erosion, settlement area is increasing, vegetation area is decreasing, but sand bar, water body and cultivated land area are oscillating. The satellite images were collected during winter and dry seasons (from November to January), when stream flow is limited for a lower amount of rainfall. Maximum erosion and management plan are critical for area at section 2 right bank 1955 to 1973. On the other hand, a minor improvement of embankment is necessary at section 2 because erosion occurs from 1973 to 1987, 1973 to 1999 and 1973 to 2011 at left bank; at section 4 because erosion occurs from 1973 to 2011 at right bank; and at section 5 because erosion occurs from 1955 to 1973 at left bank. New land developments occur at section 3 left bank from 1973 to 2016; without it, the maximum occurrence of accretion number was found from 1973 to 2016 at section 2 right bank, section 3 left bank, section 4 left bank, section 5 left bank that help for river bank management, large-scale planning to prevent flood and reduce the property loss. [ABSTRACT FROM AUTHOR]

Monitoring liquidity management of banks is one of the prime tasks of central banks. A bank that manages its liquidity inadequately can severely harm its liquidity position and potentially threaten the stability of the entire financial system. Central banks try to anticipate these risks by carefully monitoring the liquidity management of banks in large-value payment systems (LVPSs). Typically, they do this based on statistical methods in which various risk indicators related to the liquidity usage of banks are calculated from the transaction log of an LVPS. These indicators need to be manually analyzed by payment experts to find irregularities that could signal potential risks. Although statistical methods provide much insight into the liquidity management of banks, they do not scale well to the large number of banks that are subject to risk monitoring and the high velocity by which payments are nowadays settled. In this paper, we investigate whether the liquidity management of banks can be monitored more efficiently by anomaly detection. We construct different probabilistic classifiers that classify delta sequences of banks by the corresponding bank. A delta sequence captures the change in the liquidity position of a bank in an LVPS throughout a given day. Accordingly, anomalies in the intraday liquidity usage of banks are detected by determining whether the classifiers misclassify recent delta sequences that were not used to train the classifiers. Our results show that recurrent neural networks are well suited to perform this classification task and detect many irregularities in payment behavior that are interesting for the supervisors and operators of an LVPS. [ABSTRACT FROM AUTHOR]

Though remarkable literature exploring productivity and efficiency has emerged since the last half of the previous century, but dearth studies have been found in showing the impact of corporate governance on banks' productivity. The study aims to investigate the banks' productivity and its relationship with corporate governance. For this purpose, the study examines the productivity of 30 listed banks of Bangladesh deploying a Malmquist Productivity Index (an extension of Data Envelopment Analysis) with a panel data covering the period of five years from 2013 to 2017. The empirical results show that the average productivity of the banks is 1.03%. Finally, the ordinary least square (OLS), fixed effect (FE), and random effect (RE) regression were run separately. The research outcomes show that the productivity of the Bangladeshi banks is significantly influenced by financial performance, ownership structure, and board characteristics. The study provides the researchers, academicians, management of the banks, and regulatory body a new insight of how corporate governance influences the banks' productivity so that they can formulate a better policy to generate more productivity. [ABSTRACT FROM AUTHOR]

We investigate the role of loan loss provisions in analysts' decision to follow banks. We find that abnormal loan loss provisions (ALLP), regardless of whether it is income-increasing or income-decreasing, reduce analyst coverage. We interpret this effect with the finding that the greater magnitude of ALLPs decreases the accuracy and increases the dispersion of analysts' forecasts. In addition, the volatility in ALLPs leads to the decrease in analyst coverage as well. We also find a pecking order for lead analysts' decisions in a noisy information environment. Lead analysts prefer to follow financial institutions with more accurate loan loss provisions first, then with more positive (incoming-decreasing) ALLPs, and are less likely to follow those with negative (income-increasing) ALLPs. Our findings are robust to endogeneity concerns and indicate that lead analysts are deterred from more aggressive bank earnings management. [ABSTRACT FROM AUTHOR]

By their very nature, resolution actions under the legal framework for the management of bank insolvencies created by the European Bank Recovery and Resolution Directive (BRRD) and the Regulation establishing the Single Resolution Mechanism (SRMR) come with infringements of rights of shareholders and creditors. Just as any expropriation of private property by public authorities, resolution actions therefore have to comply with the principle of proportionality, as required by the applicable provisions of the EU Charter on Human Rights and the European Convention on Human Rights. Analysing parallels and differences between general insolvency law on the one hand and the special resolution framework on the other hand, the present article explores the functions and operationalisation of the principle of proportionality in bank resolution. Special attention is given to the 'public interest test' which, as part of the statutory 'conditions for resolution' under both the BRRD and the SRMR, translates general proportionality considerations into a clear-cut set of requirements designed to prevent the application of the resolution tools to cases that do not give rise to systemic stability considerations. Within the Single Resolution Mechanism, the Single Resolution Board's decision, in 2017 and 2018, not to initiate formal resolution procedures with regard to banking institutions whose failure and liquidation under national insolvency laws were not expected to trigger systemic implications clearly demonstrates both the practical relevance of considerations of proportionality in the context of bank resolutions and the need for clear-cut principles for the interpretation of the relevant parts of the framework. [ABSTRACT FROM AUTHOR]

Fodder banks are important agroforestry technologies that improve access to off-season livestock feed among smallholder farmers. However, fodder banks also contribute to nutrient mining, through biomass transfer, and therefore their sustainably may be downplayed. In order to identify sustainable managemt options, the objective of this study was to determine the effect of management practices (spacing and pruning frequency) on forage yield and soil organic carbon (SOC) of two contrasting leguminous Calliandra calothyrsus Meissner and non-leguminous (Vernonia amygdalina Del) fodder shrubs. A field trial, with the two shrubs separately planted at different spacing (0.75 × 0.75 m and 1.0 × 1.0 m) and frequency of complete pruning (5- and 9-week interval), was established in a three-replicate randomized complete block design. Harvesting of fodder biomass was done for two consecutive years from the start of pruning. Total and aggregate SOC of the top soil (0–15 cm) and sub-soil (0.15–0.30 m) was assessed in four particle-size fractions. For both species, wider spacing significantly reduced (p = 0.037) forage biomass by approximately 20%. Pruning at 9-weeks produced more forage biomass for C. calothyrsus, but not for V. amygdalina. The size of the soil aggregates significantly increased (p = 0.027) by 8% in the 9-week compared to 5-week pruning frequency. Total organic carbon (TOC) in sub soil under C. calothyrsuswas 7% higher than that under V. amygdalina. Wider spacing and lower pruning frequency significantly increased OC in sub soil (p = 0.003) by 4% and 9%, respectively. Therefore, a spacing of 1.0 m combined with a pruning frequency of 9 weeks is optimum for forage and SOC. These results suggest that the sustainability of fodder banks can be achieved by optimizing pruning frequency and plant spacing. Therefore, proper management of fodder banks can contribute to climate-smart agriculture through increasing soil carbon sequestration and increased livestock productivity among stallholder farmers. [ABSTRACT FROM AUTHOR]

Choosing appropriate peer groups for commercial banks is important to investors comparing bank performance, for regulators evaluating safety and soundness, for bank management looking at merger alternatives or relative performance, and for bank researchers testing hypotheses and making policy judgments about the banking system. We use commercial bank financial statements with common size variables as the inputs to a cluster analysis model to identify clusters or groups of banks with financial structures that are relatively homogeneous within groups and distinct across groups. Managerial strategies and idiosyncrasies, local and global economic conditions, and the regulatory environment shape bank financial statements, and financial statements should reflect the financial and operational differences across banks. Using year-end data from 2014, we cluster 6444 banks into several such groups. Our results show that bank clusters are formed largely around loan types, funding differences, and management's strategic choices. We compare the ability of bank clusters and bank size to explain several widely used measures of bank performance and risk in additional years. These bank clusters are shown to have substantially greater explanatory power in regression models when compared to groupings based on bank size in several different years. [ABSTRACT FROM AUTHOR]

With the rapid explosion of the online technology, Internet Banking (IB) has been prevalent in recent years and attracts much research attention. Although intensive studies have investigated the determinants of users' initial acceptance of IB service, much less research has further explored the continuous usage of IB service. This study focuses on the continuous IB service usage intention by examining the role of users' psychological cognition (e.g., trust and commitment) in improving their continuous usage intention of IB service. Integrating the commitment-trust theory and the unified theory of acceptance and use of technology, we argue that besides contributive effects to continuous usage intention, psychological cognition mediates the influences of usage experiences (e.g., perceived service value, quality of alternatives, and anxiety) on continuous usage intention. This model was tested using survey data from 173 non-traditional college students who were all full-time employees with several years of working experience. The results confirm the contributive and mediating effects of trust and commitment on continuous IB service usage intention. The study contributes to the literature by highlighting the role of trust and commitment in predicting IB service continuous usage, and the findings provide useful implications for bank management in retaining online customers. [ABSTRACT FROM AUTHOR]

This paper conducts the first empirical assessment of the theories concerning the influence of ownership structure on bank risk-taking in the presence of regulations in Pakistan. The sample used in this paper comprises a panel data of 26 banks in Pakistan, for the period from 2000 to 2014. The analysis provides evidence that increase in ownership concentration leads to an increase in bank risk-taking. Managerial ownership is associated with high risk-taking at low and high levels of managerial ownership while at intermediate level, managerial ownership has negative impact on bank risk-taking. Different types of ownership of banks in Pakistan have different impact on risk-taking. While government, family and institutional ownership have a positive impact on bank risk-taking, foreign ownership has a negative impact on bank risk-taking. Furthermore, the results show that capital regulations are important in influencing bank risk-taking with regard to higher ownership concentration. The findings of this paper suggest that the relation between bank risk-taking and capital regulations typically depends on the type of ownership. [ABSTRACT FROM AUTHOR]

Community banks have historically been important sources of intermediary services. Changes in regulation and intermediation technologies have affected the efficiency with which these firms can perform these services. Relatively small community banks, those with assets of $1 billion or less, have experienced particular changes in their ability to generate loan products as efficiently as their larger counterparts. Using FFIEC data for all banks of $10 billion or less, we measure the x-efficiency of all community banks and compare the results of small and all other community banks since 2010. We test for the importance of internal and external determinants of efficiency. We observe that declines in product provision are related to specific determinants of declining x-efficiency in small community banks. The results indicate limited assets or customer growth rates experienced by small community banks, coupled with a declining population in community bank trade areas, do not support improvements in x-efficiency through expanded intermediation activity. Small asset community bank managers will need to strategically deploy products that allow the customer relationship to be enhanced and sustained, using customer affiliations that cannot be easily adopted by larger competitors. [ABSTRACT FROM AUTHOR]

The problem of mathematical modeling of the “splashing out” effect is considered. The existence of this phenomenon was observed some time ago by specialists-practitioners who were forced to make management decisions affecting the dynamics of banking and economic systems. The influence of this effect as one of important new phenomena must be taken into account in decision support systems of new generation. A mathematical definition of the coefficient of globalization of the world banking system is formulated. [ABSTRACT FROM AUTHOR]

This paper advocates for actively minimising the price of bank resolution at each part of the new regulatory banking structure. It does so by examining how the banking resolution costs were increased due to decisions taken at different stages of the regime during the experience of Cyprus with bank supervision, early intervention, resolution and liquidation. The paper then moves on to argue that increasing instead of decreasing the lingering bank resolution costs in Cyprus tainted the picture of bank resolution success for which the Cypriot experience has become somewhat of a posterchild. It argues that if the success of bank resolution is evaluated after a series of bad supervisory decisions, it is more than likely to conclude that resolution was successful because it resolved a very detrimental situation. Simply put, the success of the Cypriot bank resolution might as well equate to a gigantic failure of bank supervision. As such, while acknowledging the benefits and successes of the new regime, this paper tries to showcase that the application of the supervisory and resolution regime in Cyprus hides a lot of elements that are very far from successful, but which can nevertheless form constructive lessons for the practical application of the regime in the future. [ABSTRACT FROM AUTHOR]

With the institutional setting for the Banking Union having been established and become fully operational, market participants, supervisory staff, and academics are gradually getting to terms with the reality of the new two-tier system of supervisory and resolution authorities within the Eurozone. Drawing from media coverage, input from practitioners and the on-going academic debate, the present article seeks to present an-inevitably provisional-assessment of the new regime from a German perspective. While regulatees and their advisers within the country appear to have got used to the new reality, the paper also identifies a number of residual concerns, some of which are attributable to the specific characteristics of the German financial sector, others indicative of broader problems. [ABSTRACT FROM AUTHOR]

The establishment of centralized supervision by means of the Single Supervisory Mechanism (SSM) had to ensure the quality and impartiality of banking supervision, as well as the establishment of a supervisory system more properly aligned with the characteristics of the banking sector. The far-reaching mixed administration of the European Central Bank (ECB) and national competent authorities (NCAs) must also ensure strong and consistent supervision across the participating member states while using the NCAs' local and specific know-how. All elements indicate that a more effective banking supervision was necessary for the Eurozone. This may be challenging given the conflict between the required centralisation of supervision, on the one hand, and the far-reaching mixed administration and composite legal order in place on the other. The first years of experience with the SSM provide a multi-faceted picture of the effectiveness of centralised supervision. This paper discusses the effectiveness of centralised supervision within the context of a far-reaching mixed administration and legal order on the basis of three different elements. Firstly, the basis of supervision is discussed, i.e. the applicable substantive laws for which compliance must be ensured by the ECB, and which concerns the so-called Single Rulebook. Secondly, the organisation of supervision, in practice, is discussed on the basis of one of its most important features: the Joint Supervisory Teams. Lastly, the delineation of supervisory tasks is discussed, as well as its impact on the ECB and, based on the Dutch example, its impact on national supervisory models. These elements illustrate the many steps that have been taken to improve the effectiveness of centralised supervision. They also show how many obstacles are still left to overcome. [ABSTRACT FROM AUTHOR]

Performance evaluation is an important part in the management of any decision-making unit (DMU) as it identifies sources of managerial inefficiencies and provides a policy for inefficient DMUs to improve their efficiency. The latter is generally affected by environmental variables that are beyond managerial control. Modeling the impact of these environmental variables is a critical issue for both researchers and practitioners. Researchers developed and proposed several methods to deal with this issue in general and in the data envelopment analysis (DEA) literature in particular. However, the available two-stage DEA methods do not account for interdependence between observations and they are of limited use when the number of variables is fairly large. This paper proposes an integrated framework combining DEA, and boosted generalized linear mixed models (GLMMs) that accounts for the interdependence problem when studying the impact of environmental variables on performance. Additionally, the framework carries out variable selection. The framework is illustrated with a sample of 151 commercial banks from Middle East and North African countries. [ABSTRACT FROM AUTHOR]

Using a sample of 161 global banks in 23 countries, we examine the applicability of market-based structural models and accounting-based bank fundamentals to price global bank credit risk. First, we find that variables predicted by structural models are significantly associated with bank CDS spreads. Second, some CAMELS indicators contain incremental information for bank CDS prices. We find no evidence in favor of one model over the other, while the combined structural and CAMELS model performs better than each individual model. Moreover, leverage and asset quality have had a stronger impact on bank CDS since the onset of the recent financial crisis. Banks in countries with lower stock market volatility, fewer entry barriers, and/or more financial conglomerate restrictions tend to have lower credit risk. Deposit insurance appears to have an adverse effect on bank CDS spreads, indicating a moral hazard problem. [ABSTRACT FROM AUTHOR]

The objective of this study is to examine the direct and indirect effect of management practices (procedural justice, coordination approach, communication system, integration strategy, and coping programs) on merger and acquisition (M&A) performance in the Pakistan banking industry. Psychological contract (PC) acts as a mediator between Management practices and M&A performance. The Present study distributes a structured questionnaire to 700 bank employees of different management cadres. The useful response rate is 76 % (536 employees). It uses PLS-SEM technique for data analysis. Findings: (1) procedural justice is a key strategy which has highly significant direct and indirect effect on M&A performance; however integration strategy and the communication system have an only direct effect. (2) PC performs partial mediation at different levels between management practices and M&A financial and non-financial performance. This study provides an effective solution to solve the soft issues during and post-M&A process. This is one of the few studies which effectively integrate the five constructs into a single framework to study their effects on M&A performance. Limitations and future research directions are presented in the last section of the study. [ABSTRACT FROM AUTHOR]

We propose a simple, parsimonious, and easily implementable method for stress-testing banks using a top-down approach that captures the heterogeneous impact of shocks to macroeconomic variables on banks' capitalization. Our approach relies on a variable selection method to identify the macroeconomic drivers of banking variables as well as the balance sheet and income statement factors that are key in explaining bank heterogeneity in response to macroeconomic shocks. We perform a principal component analysis on the selected variables and show how the principal component factors can be used to make projections, conditional on exogenous paths of macroeconomic variables. We apply our approach, using alternative estimation strategies and assumptions, to the 2013 and 2014 stress tests of medium- and large-size U.S. banks mandated by the Dodd-Frank Act, and obtain stress projections for capitalization measures at the bank-by-bank and industry-wide levels. Our results suggest that accounting for bank heterogeneity yields expected capital shortfalls that can be over 30 percent larger than in the case where heterogeneity is ignored. Furthermore, we find that while capitalization of the U.S. banking industry has improved in recent years, under reasonable assumptions regarding growth in assets and loans, the stress scenarios continue to imply sizable deterioration in banks' capital positions. [ABSTRACT FROM AUTHOR]

New bank formation in the U.S. has declined dramatically since the financial crisis, from over 130 new banks per year to less than 1. Many have suggested that this is due to newly-instituted regulation, but the current weak economy and low interest rates (which both depress banking profits) could also have played a role. We estimate a model of bank entry decisions on data from 1976 to 2013 which indicates that at least 75 % of the decline in new bank formation would have occurred without any regulatory change. The standalone effect of regulation is more difficult to quantify. [ABSTRACT FROM AUTHOR]