Although a large and growing literature shows that privatization can improve the performance of non-financial enterprises, there is less evidence on how it affects the performance of the banking ...sector. This paper summarizes the results from the papers in the special issue of the Journal of Banking and Finance on bank privatization. It concludes that although bank privatization usually improves bank efficiency, gains are greater when the government fully relinquishes control, when banks are privatized to strategic investors, when foreign banks are allowed to participate in the privatization process and when the government does not restrict competition.
This paper proposes and tests a model of antecedents and consequences of group potency in self-managing teams in retail banking. Based on data collected from boundary-spanning service employees ...organized in 60 teams and their customers, our findings reveal a significant positive impact of group potency on customer-perceived service quality and a negative effect on service profitability. In addition, we find that team consensus regarding group potency positively moderates the effects of group potency, so that for teams with higher levels of potency consensus, the positive impact of group potency on customer-perceived service quality is stronger, whereas the negative impact of group potency on service productivity is weaker. Furthermore, we find significant positive effects of management and interteam support and functional diversity as well as a significant negative effect of team tenure on individual team member beliefs of group potency. Finally, social support consensus moderates the effects of management support, interteam support, and team tenure on group potency, so that the effects of these antecedents are weaker for teams with higher levels of social support consensus. Thus, we conclude that team confidence consensus increases the positive impact of group potency on customer perceptions of service quality and decreases the negative impact on profitability. Thus, team-member perceptual agreement on their team's potency should be stimulated.
This project revisits the perennial debate over the relationship between job performance and turnover. Disputing traditional findings,
C. Trevor, B. Gerhart, and J. Boudreau (1997)
observed that high ...and low performers quit more than do average performers. They further challenged received wisdom by showing that promotions can induce turnover, especially among poor performers, by signaling ability. The authors sought to replicate and extend these unconventional findings by exploring curvilinear and moderating effects on the performance-exit relationship among 11,098 Swiss nationals employed in a bank. Survival regression revealed that performance is curvilinearly related to quits and that bonus pay deterred superior performers from leaving more than did pay increases. Further, the average number of job levels advanced per promotion rather than promotion rate increased quit risks. Cultural and organizational moderators of performance-termination associations and effective strategies for retaining top performers are discussed.
► Are targets in cross-border bank M&As different from targets in domestic M&As? ► We answer this question studying over 24,000 banks from more than 100 countries. ► We include banks that were not ...involved in any M&A deal as a control sample. ► With few exceptions, domestic and foreign investors target similar banks. ► The main differences across M&A types are on the effect of country characteristics.
What drives bankers to create larger and larger, often multinational banking groups? In this paper we investigate whether the targets in cross-border bank M&As are materially different from those banks targeted in domestic M&A deals. The main message of this paper is that, with few exceptions, domestic and foreign investors target similar banks. In particular, and contrary to what one might expect, bank size does not have a different effect on the probability of being a domestic or a cross-border target, instead it has a positive and highly significant effect in both cases. We find that the main differences between national and international M&As are the characteristics of the countries where the banks operate.
In this paper we investigate whether the reaction function of the National Bank of Poland (NBP) is asymmetric according to the level of inflation gap and the level of output gap. Moreover, we test ...whether these asymmetries might possibly stem from nonlinearities in the Phillips curve. Threshold models are applied and two cases of unknown and known threshold values are investigated. Our results show that the Polish central bank responds more strongly to the level inflation when the level of inflation is relatively high. We find very weak evidence that the level of inflation reacts more strongly to the output gap when the output gap is relatively high. Thus, the asymmetries in the monetary policy rule seem to indicate asymmetric preferences of the central bank.
•We study asymmetric effects in the reaction function of the Polish central bank.•Asymmetric preferences and nonlinear Phillips curve are the sources of asymmetries.•There is very weak evidence that the Phillips curve is nonlinear.•The central bank seems to react more strongly to inflation when it is relatively high.•It is because of implementing inflation targeting and the need to build credibility.
On May 29, 2008, the Wall Street Journal reported that several large international banks were reporting unjustifiably low LIBOR rates. Since then two large banks, Barclays and UBS, have paid ...significant fines for manipulating their LIBOR rates, and additional banks are expected to be fined. This paper investigates whether the underreporting of LIBOR rates by some banks significantly affected the reported LIBOR rate by testing whether there was a significant change in the relationship between the LIBOR rate and another rate that reflects the default risk of banks.
U izvršenju spoljnotrgovinskih plaćanja postoje mogućnosti upotrebe širokog spektra instrumenata. Svaki od njih ima svoje specifičnosti na koje ćemo ukazati. Ubjedljivo najviše korišćeni instrument ...međunarodnih plaćanja je dokumentarni akreditiv. Pored akreditiva i „tradicionalniih“ instrumenata plaćanja - čeka i mjenice, u spoljnotrgovinskom poslu postoji i mogućnost plaćanja bankarskim doznakama, što se uglavnom koristi za avansna plaćanja (plaćanja unaprijed, pre prijema robe), što nosi određene rizike za kupca. Postoji i mogućnosti dokumentarne naplate - tzv. dokumentarni inkaso. Kod tog instrumenta je obnut red poteza od doznačavanja sredstava unaprijed. To nosi rizik za prodavca koji šalje robu unaprijred, a posebno šalje dokumenta na naplatu, a ona se naplate kada se kupac saglasi. Instrumenti platnog prometa su predmet ovog rada.
In carrying out foreign trade payments, there are possibilities of using a wide range of instruments.. Every sinlge instrument has its own specificities that we will consider in the paper. By far the most commonly used instrument of international payment is a documentary letter of credit. In addition to letters of credit and “traditional” payment instruments - waiting and bills in foreign trade transactions there is a possibility of payment bank transfer, which is mainly used for advance payments (payments in advance, before receipt of the goods), which carries certain risks for the buyer. There is also the possibility of documentary collection - the so-called documentary collection. When any instrument is the reverse order of strokes of remittances advance. This carries the risk that the seller sends the goods in advance, and in particular sends the document to the collection, and it is charging when the buyer agrees. Payment instruments are the subject of this paper.
This paper re-examines the determinants of Net Interest Margin (NIM) in the banking industries of 15 developed and emerging economies. It presents three main contributions with respect to previous ...studies: first, we analyze the determinants of NIM in the years leading to the 2008 financial crisis; second, we account for the role of different accounting standards across countries; third, we use multi-way cluster estimation methodologies which control for cross-sectional and time-series dependence in macroeconomic and banking variables. We find that the introduction of International Financial Reporting Standards (IFRSs) contributed to lower NIM variations unexplained by standard accounting variables. Interest rate volatility is found to be positively and strongly related to NIM dynamics, whereas inflation risk is often found to be a relevant driver of NIM cross-country differences.
► In this paper we examine the determinants of bank Net Interest Margins (NIM) across 15 developing and developed countries since 1999 to 2008. ► Bank (NIM) in developed countries are substantially lower than emerging economies. ► Interest rate volatility is positively and strongly related to NIM across countries and time. ► Inflation risk is often a variable related to NIM cross-country differences. ► International Financial Reporting Standards contribute to lower NIM variations unexplained by standard accounting variables.
This paper estimates ordered logit models for bank ratings which include a country index to capture country-specific variation. The empirical findings support the hypothesis that the individual ...international bank ratings assigned by Fitch Ratings are underpinned by fundamental quantitative financial analyses. Also, there is strong evidence of a country effect. Our model is shown to provide accurate predictions of bank ratings for the period prior to the 2007–2008 banking crisis based upon publicly available information. However, our results also suggest that quantitative models are unlikely to predict ratings with complete accuracy. Furthermore, we find that both quantitative models and rating agencies are likely to produce highly inaccurate predictions of ratings during periods of financial instability.
This paper examines national regulators’ incentives to intervene in a multinational bank’s activities and the extent to which these incentives differ with the bank’s foreign representation choice ...(branch or subsidiary). Shared liability leads to higher incentives for intervention than legal separation. Cross-border deposit insurance, on the other hand, yields less intervention than when regulators compensate local depositors only. Based on these results, we derive implications for multinational banks’ and regulators’ preference on foreign expansion and representation.
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