Strengthening the supervision and regulation of the depository institutions : hearings before the Committee on Banking, Housing, and Urban Affairs, United States Senate, One Hundred Second Congress, first session, on reform federal deposit insurance, protect the deposit insurance funds, and improve supervision and regulation of and disclosure relating to federally insured depository institutions ....

"February 26, 1991 ... April 23, 1991"--Vol. 1. "April 25, 1991 ... November 25, 1991"--Vol. 2.

Developing a framework for Six Sigma in financial service institutions : empirical evidence from expert interviews

Six Sigma is considered to be an important management philosophy to obtain satisfied customers. But financial service organisations have been slow to adopt Six Sigma issues so far. Despite the extensive effort that has been invested and benefits that can be obtained, the systematic implementation of Six Sigma in financial service organisations is limited. As a company wide implementation framework is missing so far, this paper tries to fill this gap. Based on theory, a conceptual framework is developed and evaluated by experts from financial institutions. The results show that it is very important to link Six Sigma with the strategic as well as the operations level. Furthermore, although Six Sigma is a very important method for improving quality of processes others such as Lean Management are also used This requires a superior project portfolio management to coordinate resources and projects of Six Sigma with the other methods used. Beside the theoretical contribution, the framework can be used by financial service companies to evaluate their Six Sigma activities. Thus, the framework grounded through literature and empirical data will be a useful guide for sustainable and successful implementation of a Six Sigma initiative in financial service organisations.

An Empirical Analysis of Scale and Scope Economies and Technical Change in an Irish Multiproduct Banking Firm

In contrast to most empirical investigations of the efficiency of multiproduct financial institutions, which either estimate scale and scope economies with a given state of technology, or only analyse technical change in the presence of overall scale economies, this study estimates overall scale economies, product-specific scale economies and scope economies in the presence of both neutral and non-neutral technical change. Also, in contrast to most other empirical studies in this area, standard errors are computed for all relevant statistics. The findings indicate diseconomies of scope; overall diseconomies of scale; product-specific economies are decreasing for investments and increasing for loans; in addition to substantial neutral technical change, biased technical change is labour- and capital-saving and deposits-using in character.

Service provider switching: a study on the switching process in retail banking

In a business environment that is characterized by intense competition, building customer loyalty has become a key area of focus for most financial institutions. The explosion of the services sector, changing customer demographics and deregulation and emergence of new technology in the financial services industry have had a critical impact on consumers’ financial services buying behaviour. The changes have forced banks to modify their service offerings to customers so as to ensure high levels of customer satisfaction and also high levels of customer retention. Banks have historically had difficulty distinguishing their products from one another because of their relative homogeneity; with increasing competition,the problem has only intensified with no coherent distinguishing theme. Rising wealth, product proliferation, regulatory changes and newer technologies are together making bank switching easier for customers. In order to remain competitive, it is important for banks to retain their customer base. The financial services sector is the foundation for any economy and plays the role of mobilization of resources and their allocation. The retail banking sector in India has emerged as one of the major drivers of the overall banking industry and has witnessed enormous growth. Switching behaviour has a negative impact on the banks’ market share and profitability as the costs of acquiring customers are much higher than the costs of retaining. When customers switch, the business loses the potential for additional profits from the customer the initial costs invested in the customer by the business get . The Objective of the thesis was to examine the relationship among triggers that customers experience, their perceptions of service quality, consumers’ commitment and behavioral intentions in the contemporary India retail banking context through the eyes of the customer. To understand customers’ perception of these aspects, data were collected from retail banking customers alone for the purpose of analysis, though the banks’ views were considered during the qualitative work carried out prior to the main study. No respondent who is an employee of a banking organization was considered for the final study to avoid the possibility of any bias that could affect the results adversely. The data for the study were collected from customers who have switched banks and from those who were non switchers. The study attempted to develop and validate a multidimensional construct of service quality for retail banking from the consumer’s perspective. A major conclusion from the empirical research was the confirmation of the multidimensional construct for perceived service quality in the banking context. Switching can be viewed as an optimization problem for customers; customers review the potential gains of switching to another service provider against the costs of leaving the service provider. As banks do not provide tangible products, their service quality is usually assessed through service provider’s relationship with customers. Thus, banks should pay attention towards their employees’ skills and knowledge; assessing customers’ needs and offering fast and efficient services.

Does it pay to be socially responsible? Evidence from spanish retail banking sector

This paper presents a theoretical and empirical analysis of strategic competition in retail banking when some of the financial firms are non-profit organisations that invest in social activities. Banking literature about competition is fairly large, but the strategic interaction between profit maximizing and non profit maximizers has not been extensively analysed except for Purroy and Salas (1999). In this paper, a completely different approach is taken. An adaptation of Hotelling’s two stage model of spatial competition is developed to take into account consumer perceptions respect to the two different types of financial institutions. The empirical analysis confirms that consumers take into account other features different from the price, such as social contribution or closer service to make a deposit or mortgage decision. These conclusions are of interest in the debate about a firm’s social or ethical activities. It is shown that if consumers value social activities, firms can improv

The post-financial crisis challenges for corporate governance and banking reform in China

The purpose of this paper is to review the impact of the global financial crisis on banking reform in China. The significant doubt concerning the efficiencies of Anglo-American model of corporate governance has raised a critical political question amongst scholars and practitioners as to whether China should continue to follow the U.K.-U.S. path in relation to financial reform. This conceptual paper provides an insightful review of the corporate governance literature and regulatory reports. After examining the fundamental limitations of the laissez-faire philosophy that underpins the neo-liberal model of capitalism, which promotes greater liberalization and less control, the paper considers the risks in opening China’s financial markets and relaxing monetary and fiscal policies. A critique of shareholder-capitalism is outlined in relation to the German’s “social market economy” styled capitalism. Through such analysis the paper explores a number of implications for China to consider in terms of developing a new and sustainable corporate governance model applicable to the Chinese context.

Financial safety nets: reconstructing and modelling a policymaking metaphor

This paper explains that financial safety nets exist because of difficulties in enforcing contracts and shows that elements of deposit-insurance schemes differ substantially across countries. It shows that differences in the design of financial safety nets correlate significantly with differences in the informational and contracting environments of individual countries and that a country's GDP per capita is correlated with proxies for a country's level of: (1) informational transparency, (2) contract enforcement and deterrent rights, and (3) accountability for safety net officials. The analysis portrays deposit insurance as a part of a country's larger safety net and contracting environment. This means that there is no universal method for preventing and resolving banking problems and that the structure of a country's safety net should evolve over time with changes in private and government regulators' capacity for valuing financial institutions, disciplining risk taking and resolving insolvency promptly, and for being held accountable for how well they perform these tasks.

The privatisation experience in the Australian banking and insurance sectors: an explanation of the change in ownership structures

Deregulation has been a feature of the evolution of financial markets in the past two decades. Extending this trend has been the move to privatise government-owned financial institutions. In the 1990s, Australian governments progressively sold publicly owned banks and insurance institutions. One outcome has been that few of these privatised financial firms exist today, having been absorbed in mergers and acquisitions within the financial services sector. This paper uses an information cost framework to explain the experience of privatised banks and insurers. Our approach points to a dynamic process of organisational change that has influenced the outcomes of privatisation in the financial services sector.

The privatisation experience in banking and insurance in Australia

The role of ownership in performance of financial institutions is under-examined yet remains a topical issue. Whilst ownership changes in the banking sector have been evaluated in several studies, the link with other sectors has not been a focus of in depth analysis. A controlled comparison of performance between privatising banks and insurance firms in Australia is undertaken via a ‘meso’ approach of pairing privatising with comparator private institutions across the event period. Performance is evaluated using commercial CAMEL indicators and applying Wilcoxon rank tests (Otchere and Chan 2003) which provide statistically robust findings in the small annual data samples available around the privatisation event. Performance of privatising and private institutions is found to be quite similar before and after the event. For the privatising banks, some indicator medians improved to commercial levels (CBA) or were mostly unchanged (Colonial). By contrast one of the privatising insurance institutions (Suncorp) was found to outperform the private insurance comparator while there was little difference for the other (GIO).

Mobile banking innovations and entrepreneurial adoption decisions

This paper examines an individual’s entrepreneurial adoption decisions to use mobile banking for both business and social reasons. A conceptual model based on social cognitive theory is developed to explain an individual’s propensity to adopt mobile banking. The theoretical framework examines how advertising, experience, perceived risk, learning inclination, and entrepreneurial proclivity influence a person’s intention to use mobile banking. This paper stresses the role of financial risk in determining a person’s intention to use mobile banking and whether their entrepreneurial nature is influenced by their experience and advertising they are subjected to about the advantages or disadvantages of mobile banking. This paper ties together research on technological innovation with entrepreneurship and learning studies. The author stresses the importance for financial institutions to market the innovativeness of mobile banking whilst addressing security concerns. The impact of a person’s social environment through personal contacts and acquaintances underpins social cognitive theory and helps to understand the motives for a person adopting mobile banking. The paper integrates mobile banking literature with current thinking on the importance of entrepreneurship and learning influences to how a person adopts a technological innovation.

A survey of value-at-risk and its role in the banking industry

This paper discusses the various aspects of Value-at-Risk (VaR) and the VaR-based risk management process as it pertains to the banking industry. Since its inception in the 1990’s, VaR has become the industry standard by which market risk is both measured and managed by financial institutions today. However, there has been much debate regarding VaR’s validity and the extent of its role within the banking industry. Yet, now that it is an integral part of the regulatory framework, establishing VaR’s legitimacy is more important than ever. Therefore, this paper examines the recent literature on VaR’s use as a market risk management tool within the banking environment in an attempt to clarify some of the more contentious issues which have been raised by researchers. The discussion begins by highlighting the underlying theory on which VaR is based, specific aspects which have proven controversial and its use from a regulatory perspective. The focus then turns to what little literature exists on the subject of VaR and asset returns in an attempt to provide some direction for future research.

Entrepreneurship, e-finance and mobile banking

This paper focuses on the role of entrepreneurship and e-finance in determining a person's intention to adopt mobile banking. The approach utilised in this paper is to develop a conceptual framework that includes a number of propositions that are developed and justified by the literature. The main findings of this paper are that people's entrepreneurial inclination and learning tendency will determine how they respond to marketing and knowledge about mobile banking. The practical implications are that financial institutions involved in e-finance can focus their marketing efforts at increasing people's exposure to mobile banking.

Assessing Dodd Frank Effects on banking capital structure and Banker´s Pay structure

The systemic financial crisis that started in 2008 in the United States had some severe effects in the economic activity and required the bailout of financial institutions with the use of taxpayer’s money. It also originated claims for stronger regulatory framework in order to avoid another threat in the financial market. The Dodd Frank Act was proposed and approved in the United States in the aftermath of the crisis and brought, among many other features, the creation of the Financial Stability Oversight Council and the tougher inspection of financial institutions with asset above 50 billion dollars. The objective of this work is to study the causal effect of the Dodd Frank Act on the behavior of the treatment group subject to monitoring by the Financial Stability Oversight Council (financial institutions with assets above 50 billion dollars) regarding capital and compensation structure in comparison to the group that was not treated. We use data from Compustat and our empirical strategy is the Regression Discontinuity Design, not usually applied to the banking literature, but very useful for the present work since it allows us to compare the treatment group and the non-treatment group in the year of the enactment of the law (2010). No change of behavior was observed for the Capital Structure. In the Compensation Schemes, however, a decrease was found in the item other compensation for CEOs and CFOs. We also performed a robustness check by running a placebo test on the variables in the year before the law was enacted. No significance was found, which supports the conclusion that our main results were caused by the enactment of the DFA.

10 anos de internet banking: desvendando o processo de incorporação de tecnologia em um banco brasileiro através de uma abordagem sociotécnica

As instituições financeiras brasileiras, desde 1995, utilizam intensamente a Internet em benefício de seus negócios. Neste relatório apresentamos os resultados do trabalho de exploração do processo pelo qual a utilização da tecnologia da Internet tornou-se uma realidade para um banco brasileiro e sua evolução nesta instituição; examinando o processo à luz de uma perspectiva teórica não-difusionista, a abordagem da Teoria Ator-Rede. Identificou-se que diversos atores estiveram envolvidos com a incorporação da Internet pelo banco e estão envolvidos com a sua manutenção como uma tecnologia importante para a instituição; e várias estratégias foram, e são, adotadas para sustentar esta situação.

Banking efficiency, governance and financial regulation in Brazil

The paper analyses some dimensions of the relationship between banking efficiency, macroeconomic environment and financial regulation, with special focus on Brazil.