Our study attempts to investigate the relationship between profitability and a set of bank-specific characteristics and macroeconomic factors on foreign and local banks in Ghana between 1999 and 2010. The findings suggest that cost management has an inverse relationship with profitability, bank size and credit risk show a positive association with profitability. The results apply to foreign and local banks as well. Our results suggest that bank management should pay attention to cost maintenance, and prudent risk management to deliver profitability, and perhaps build bigger local banks.

Investors’ confidence is often abused by individuals who take advantage of investors on the financial market through fraudulent investment schemes. This article analyses factors that expose investors to Ponzi schemes. This study adopts a logistic regression model to assess the chances of investors falling prey to fraudulent investment schemes. This relationship is hypothesized as a function of affinity and trust, risk appetite, investment knowledge, understanding of Ponzi scheme, awareness of failed investment company, and demographic factors. The article reveals that affinity and trust, investment knowledge, awareness of investment company failure, understanding of Ponzi and educational level significantly affect the chances of an investor being victim or a non-victim of a Ponzi scheme. Demographic factors exhibit the expected relationship although not significant. The investment market can in no way be free of Ponzi schemes. Regulators of financial markets would have to intensify education of investors on how to identify and avoid Ponzi schemes. By analysing investors’ Ponzi victimization factors, this article adds to our empirical understanding of the factors that tend to put investors at risk of falling prey to Ponzi schemes.

This paper investigates income diversification in credit unions in Ghana. We make use of the random effect, Hausman–Taylor, and fractional regression to assess income diversification. We find empirical support that there exist differences between workplace credit union income diversification and other types of credit union. We also find that within nonfinancial income, size, liquidity, loan portfolio, net worth, and economic growth are important. For within liquid financial investment diversification, size, liquidity, resource usage, age, net interest margin, bank concentration, inflation, and economic growth matter. We recommend that with excess reserves, credit unions should pursue liquid financial investment.

Purpose The purpose of this paper is to primarily investigate the ability of independent central banks (central bank independence (CBI)) to improve fiscal performances in Africa, accounting for election years, and also to examine whether the effectiveness of CBI in improving fiscal performance is enhanced by higher political institutional quality. Design/methodology/approach Using recent CBI data from Garriga (2016) on 48 African countries, 90 other developing countries and 40 developed countries over the period 1970–2012, the authors apply a two stage system GMM with Windmeijer (2005) small sample robust correction estimator to examine the impact of CBI and elections on fiscal policy in Africa, other developing countries and developed countries. Findings The authors provide evidence that unlike in other developing countries and developed countries, CBI does not significantly improve fiscal performance in Africa. However, the effectiveness of CBI in improving fiscal performance in Africa is enhanced by higher levels of institutional quality. Although elections directly worsen fiscal performance in Africa, institutional quality enhances CBI’s effect on improving fiscal performance in election years across Africa, other developing countries and developed countries. Practical implications The findings of the study are significant as they provide insight into the benefits of having strong institutions to complement independent central banks in order to control fiscal indiscipline in election years. Originality/value The study is the first among the studies of CBI-fiscal policy nexus, to measure fiscal policy using net central bank claims on government as a percentage of GDP. In addition to the use of fiscal balance, this study also uses cyclically adjusted fiscal balance as a measure of fiscal policy. This is a critical channel through which independent central banks can constrain government spending. It also compares findings in Africa to other developing countries, noting some differences.

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