Cryptographic tools like Hill's encryption algorithm protect digital data. In this work, we present a novel Hill cipher security method that utilizes Gaussian integers from number theory. Using these ...intriguing mathematical entities to disguise plaintext values dramatically boosts assault resistance and duration. This research includes a three-pass protocol for encryption and decryption without key exchange, ensuring a safe, efficient, and dependable solution. Pandas is used for efficient data processing, and Numpy for computational tasks, notably matrices. Hill cipher-based encryption and decryption can be utilized in real life. It also demonstrates how to save Pandas DataFrame data to Excel. This strategy assures progress in cryptography. Uniquely designed for banking, it emphasizes its applicability and possible influence on present financial systems.
Assessment of alternative banking systems is a difficult problem with multiple and conflicting criteria. This study proposes a multi-criteria decision-making (MCDM) model for evaluating alternative ...social banking systems (with no interest charges) using a T-Spherical fuzzy Decision-Making Trial and Evaluation Laboratory (DEMATEL) called TOP-DEMATEL. First, a comprehensive literature review determines the factors affecting the performance of alternative systems. An analysis is carried out with the help of the T-Spherical fuzzy TOP-DEMATEL approach to determine the importance weights of the factors under consideration. The alternative social banking systems with no interest charges are designed to minimize the negative effects of interest on the economy. The causality analysis shows that the effective risk analysis and employment of qualified personnel were the most effective criteria on all other factors. In addition, the improvement of the technological infrastructure is also affected by all other factors. Effective risk analysis is determined as the most important criterion for the performance of the alternative banking system. In this context, a comprehensive risk analysis is required for the success of the new alternative banking system.
•The priority issues for alternative banking systems are identified.•T-Spherical fuzzy TOP-DEMATEL method is considered.•Effective risk analysis plays the most critical role.•The improvement of the technological infrastructure is crucial.•A comprehensive risk analysis is required for success.
We propose an interacting particle system to model the evolution of a system of banks with mutual exposures. In this model, a bank defaults when its normalized asset value hits a lower threshold, and ...its default causes instantaneous losses to other banks, possibly triggering a cascade of defaults. The strength of this interaction is determined by the level of the so-called noncore exposure. We show that, when the size of the system becomes large, the cumulative loss process of a bank resulting from the defaults of other banks exhibits discontinuities. These discontinuities are naturally interpreted as systemic events, and we characterize them explicitly in terms of the level of noncore exposure and the fraction of banks that are “about to default.” The main mathematical challenges of our work stem from the very singular nature of the interaction between the particles, which is inherited by the limiting system. A similar particle system is analyzed in Ann. Appl. Probab. 25 (2015) 2096–2133 and Stochastic Process. Appl. 125 (2015) 2451–2492, and we build on and extend their results. In particular, we characterize the large-population limit of the system and analyze the jump times, the regularity between jumps, and the local uniqueness of the limiting process.
The main objective of the paper is to assess the impact of reforms on bank profitability in the eleven banking systems from the Commonwealth of Independent States (all current or former members): ...Armenia, Azerbaijan, Republic of Belarus, Georgia, Kazakhstan, Kyrgyzstan, Republic of Moldova, Tajikistan, Turkmenistan, Ukraine and Uzbekistan, for the period between 2005 and 2011. We use as proxy for bank profitability the return on average equity (ROAE) and the return on average assets (ROAA). The estimations show that financial freedom and Banking sector reform indicators have a strong statistical significance and negatively impact the bank profitability. This could be explained by the fact that reforms increased competition with the consequence of diminishing profit margins and abnormal returns. However, the Regulatory quality indicator had no statistical significance, meaning that the laws are not enforced. Our secondary result is that Business Mix has a negative significant impact on ROAE, while management efficiency negatively influences both ROAA and ROAE.
This study investigates the relationship between diversification and Islamic banking systems' performance under the impact of the COVID-19 turmoil using a sample of 24 countries from 2013Q4 and ...2020Q4. The findings indicate that the performance of Islamic banking systems is positively associated with sectoral diversification of Shari'ah-compliant financing and income diversification. Although this study confirms a negative impact of the COVID-19 shock, income diversification is found to mitigate the adverse effect of this health crisis on the performance of the Islamic banking systems. In which, Sukuk investment is considered an essential channel for pursuing this diversification strategy. Therefore, this research has important implications for policymakers, managers, and academics.
Diversification, Sukuk investment, Islamic banking systems, Performance, COVID-19, Generalized method of moments (GMM).
Purpose
Cash-waqf is one of the transformative models of waqf assets submission to optimize the receipt of waqf of money in Indonesia. Currently, cash-waqf can be paid through the platforms that are ...integrated with digital sharia banking systems (DSBS) such as Jadiberkah.Id (Bank Syariah Mandiri), Digital Wakaf Hasanah (Bank Negara Indonesia Syariah) and other waqf online services provided by Bank Syariah Bukopin, Bank Commerce International Merchant Bankers Niaga and Bank Rakyat Indonesia Syariah. This study aims to investigate the role of DSBS in stimulating Muslim youth’s decision to endow cash-waqf in Indonesia.
Design/methodology/approach
This research involved 225 Muslim youth from several universities across the Special Province of Yogyakarta and Central Java as the research respondents. The analysis was conducted using partial least square structural equation modeling with WarpPLS 7.0.
Findings
The result of the structural model indicates that the research model is structurally good since it meets all model criteria. Perceived ease of use (PEU) is found as the most significant predictor of perceived usefulness (PU). Both generate a significant effect on Muslim youths’ attitudes toward DSBS. Overall, subjective norm (SN), perceived behavioral control (PBC), PU and attitudes are important determinants that lead individual decisions to use the online cash-waqf payment through DSBS. Finally, the research findings conclude that DSBS plays a significant role in encouraging the interest of young Muslim generations to participate in cash-waqf transactions.
Originality/value
This study seeks to contribute to the existing literature by enriching the discussion on DSBS’s service, especially in the context of optimizing the collection of Islamic Philanthropy through cash-waqf transaction. Also, this study integrates theory of planned behavior (TPB) and the technology acceptance model (TAM) into a single research model to explore the determinants of cash-waqf participation in digital era.
While operating side-by-side with conventional banks, in a dual-banking system, the systemic risk profile of Islamic banks can be different due to their unique business model. The objective of this ...study is to understand the evolution of systemic risk in dual-banking systems and determine whether there are any differences in the systemic risk profiles of conventional and Islamic banks during the COVID-19 pandemic. This study also identifies the determinants of systemic importance (measured using spillover indices) of financial institutions. The sample includes ten countries where the Islamic banking sector is considered systemically important and covers the period from November 2015 to November 2020. The empirical results indicate a significant increase in systemic risk, in the sample countries, during the first half which is followed by a recovery in the second half of 2020. Comparative analysis shows that Islamic banks have similar systemic vulnerabilities to systematic and idiosyncratic factors during the exogenously induced real economic shock of the COVID-19. However, Islamic banks pose significantly less spillover to others relative to conventional banks while earning abnormal returns. The results are robust to the inclusion of macroeconomic factors and alternate estimation methodologies. The findings of this study provide valuable insights for the regulators of dual-banking systems.
•Islamic banks' risk profiles are different due to their business model.•Evaluated systemic risk of countries with systemically important Islamic banking sector.•Identified the determinants of systemic importance of financial institutions.•Report a significant increase in systemic risk during the first half of 2020.•Islamic banks earn abnormal returns and are less likely to spillover to others.
The specific nature of banking activities and its role for the economy of a country preserve a special way of organizing, being also the most regulated field. The regulation is given in each country ...by the national banking law, which is meant to create conditions for normal competition between credit institutions. For EU member states the legislative framework is given by the European directives transposed into national regulations. In an economy, banks (credit institutions in general) have a double role: the financial intermediation in saving-investing relationship, a decisive relationship for economic growth. In other words, banks attract resources and place them in the economy mainly by distributing credits; - Banks are the transmission mechanisms of monetary policy whose effectiveness depends on the state of health of the banking system and of the entire economy.
Abstract
Following the financial crisis, the United Kingdom introduced major structural reforms to address concern about Too-Big-To-Fail (TBTF) banks, while France and Germany adopted much weaker ...reforms. This is puzzling given the presence of large universal banks engaged in market making activities in all three countries, which suffered significant losses during the international financial crisis, and given the commitments to reform made by political leaders in all three countries. The paper explains this policy divergence by analysing how dynamics of agenda setting contributed to the emergence of policy windows on structural reform. We explain the United Kingdom's decision to delegate the process to an independent commission as an example of venue shifting which helped to insulate the process from industry framing, and resulted in “conflict expansion” by mobilizing a wider coalition of actors in support of bank ringfencing. By contrast, in France and Germany the agenda was tightly managed through existing institutional venues, enabling industry to resist the framing of the issue around TBTF and limiting the role of non-business groups—a process we label as “conflict contraction.” We argue that analysis of agenda setting dynamics provides new insights into the cross-national variability of business power.
•A Markov model that tracks and forecasts the potential contagion of bank runs.•Input variables include initial and proportions of cash withdrawals, initial failure rates, and a contagion market ...factor of bank runs.•Three illustrations of the model along hypothetical banking systems.•Several numerical examples and sensitivity analyses are provided.
In this study, we develop a generic Markov model that tracks in real-time and forecasts the potential contagion of bank runs during severe contractionary economic cycles. The proposed model aims to assist regulatory bodies that supervise heterogeneous banking systems by offering an adaptable monitoring scheme. The model calibrates a few input variables including initial cash withdrawals, bank idiosyncratic initial failure rates, allocated proportions of cash withdrawals, and a contagion market factor of bank runs, and it concludes with designated measures for the overall strength of a banking system and for the expected time until a banking system failure, as predefined by policymakers. We also illustrate the functionality of the model along three hypothetical banking systems and further deploy numerical examples and sensitivity analyses, which reveal that initial bank failure rates play a bigger role in the propagation of bank runs than the contagion market factor.
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