The Performance of the Use of Modern Methods of Financing and its Impact on Banks' Capital Adequacy Ratio

Abbas Talebbeydokhti, Mohammad Taheri

Abstract


Due to the variable nature of the banking system space in recent years, many researchers have studied the performance of these systems as well as the impact of new financial performances on them. Increasingly competitive market of financial institutions and banks, prompted investors and managers of these units to pay special attention to improving the performance of their systems especially the cases related to financing methods of the institution. In this regard, some banks use modern methods of financing. The purpose of this study was to investigate the performance of the use of modern methods of financing and its impact on the banks' capital adequacy ratio. The statistical population of the study is all branches of Eghtesad Novin Bank in Iran, which are over 270 branches throughout Iran. Due to data envelopment analysis selection in this study as a research method, the sample was consistent with the population. Due to the integrated banking system of EghtesadNovin Bank, all banking operations are concentrated in the central core of the bank and the branches have no independent financial statements. Therefore, the required data for the present study have been computed and extracted from the headquarters of EghtesadNovin Bank. The results of this study showed that technical efficiency in the state of BCC (VRS) situations of issuing in the modes of I and E and in the state of CCR (CRS) situations of issuing in the modes of E, D, and J is below average, so it is ineffective.

Full Text:

PDF 31-39

References


Armstrong, C., Guay, W. R., Mehran, H., & Weber, J. (2015). The role of information and financial reporting in corporate governance: A review of the evidence and the implications for banking firms and the financial services industry. Economic Policy Review, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2613230.

Bazbauers, A. R. (2017). The Relational Dynamics of World Bank Survey Missions. International Journal of Public Administration, 1-13.

Hassan Al-Tamimi, H. A., & Mohammed Al-Mazrooei, F. (2007). Banks' risk management: a comparison study of UAE national and foreign banks. The Journal of Risk Finance, 8(4), 394-409.

Jizi, M. I., Salama, A., Dixon, R., & Stratling, R. (2014). Corporate governance and corporate social responsibility disclosure: Evidence from the US banking sector. Journal of Business Ethics, 125(4), 601-615.

Khodamoradi, S., Safari, A., & Rahimi, R. (2014). A hybrid multi-criteria model for insurance companies rating. International Business Research, 7(6), 150.

Laudon, K. C., & Laudon, J. P. (2016). Management information system: Pearson Education India.

Mohieldin, M., & Nasr, S. (2007). On bank privatization: The case of Egypt. The Quarterly Review of Economics and Finance, 46(5), 707-725.

Njanike, K. (2009). The impact of effective credit risk management on bank survival. Annals of the University of PetroÅŸani, Economics, 9(2), 173-184.

Paradi, J. C., & Zhu, H. (2013). A survey on bank branch efficiency and performance research with data envelopment analysis. Omega, 41(1), 61-79.

Platonova, E., Asutay, M., Dixon, R., & Mohammad, S. (2016). The impact of corporate social responsibility disclosure on financial performance: Evidence from the GCC Islamic Banking Sector. Journal of Business Ethics, 1-21.

Raeisi, M., Haghighat, A., & Shirazi, J. K. (2016). Bank Liquidity and its Effective Factors in Iran. International Journal of Educational Advancement, 7(3), 315-300.

Salas, V., & Saurina, J. (2002). Credit risk in two institutional regimes: Spanish commercial and savings banks. Journal of Financial Services Research, 22(3), 203-224.

Samad, A. (2004). Performance of Interest-free Islamic banks vis-Ã -vis Interest-based Conventional Banks of Bahrain. International Journal of Economics, Management and Accounting, 12(2).

Saunders, A., & Allen, L. (2010). Credit risk management in and out of the financial crisis: new approaches to value at risk and other paradigms (Vol. 528): John Wiley & Sons.


Refbacks

  • There are currently no refbacks.


Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

World of Researches Publication