An Evaluation of Financial Stress for Islamic Banks in Indonesia Using a Bankometer Model

Budiman, Teguh; Herwany, Aldrin; Kristanti, Farida Titik

doi:10.35609/jfbr.2017.2.3(3)

Cited by 6 publications

(1 citation statement)

References 15 publications

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“…In other words, the probability of survival of any bank with s-score below 50% is lower than its probability of bankruptcy. According to Budiman, Herwany and Kristanti [20] a distressed institution would have challenges meeting its obligations as and when due and such obligations for a bank includes honouring its customers' and investors" demands, failure of which can trigger a run. It is therefore expected that the failure of banks to meet the soundness' minimum s-score of 70%, the relevant regulators should undertake necessary reforms to reposition the systems to assure the depositors and investors of the safety of their investments.…”

Section: The Conceptual Frameworkmentioning

confidence: 99%

Evaluation of Nigerian Deposit Money Banks’ Soundness: Bankometer Model

Oseni

2024

Asian J. Econ. Busin. Acc.

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The study examined the soundness of the Nigerian deposit money banks in view of stakeholders’ increasing dependence on it as a catalyst for achieving individual and corporate prosperity (wealth, access to funding, improved standard of living, etc.). The study examined 13 banks over a period of 10 years (2013 - 2022) using both ordinarily least square (OLS) and the IMF’s bankometer model for its analysis. The study observed that the IMF’s bankometer model variables exert significant influence on the soundness of the banks and therefore the model was found appropriate to evaluate banks to determine their state of health. Secondly, the study observed 92.30% of the Nigerian banks examined between 2013 and 2022 had solvency-score (s-score) above IMF’s model soundness minimum threshold of 70%. This implies that all the banks were healthy with the exception of one bank that had a negative s-score indicating a serious state of distress. The foreign affiliated banks were however found to be healthier than the 1st tier banks while three of the the 2nd tier banks had s-score higher than one of the 1st tier banks. The regulators should be proactive in their monitoring activities, rather than depending only on the historical performance review of the banks. Furthermore, the regulators should devise mechanisms to forecast future trends of each of the banks and for each of the measurement metrics to enable them take precautionary actions that would ensure financial stability and protect the interest of all the stakeholders.

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Section: The Conceptual Frameworkmentioning

confidence: 99%

Evaluation of Nigerian Deposit Money Banks’ Soundness: Bankometer Model

Oseni

2024

Asian J. Econ. Busin. Acc.

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Efforts to Increase Core Capital for Core Capital Bank Group Base on Regulation

Rahayu

Isfianadewi

2023

Lecture Notes in Networks and Systems

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The evaluation of stability of Czech and Slovak banks

Kočišová

Gavurová

Behún

2018

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Research background: Commercial banks could affect the stability of the whole banking system due to the way they carry out their business activities. The supervision authorities play a key role in protecting banking stability by ensuring banks´ resilience to shocks, ability to recover their position in response to crisis and ultimately the supervision authorities help prevent failure of these banks. Therefore, in recent years' researchers have been trying to define conditions that could guarantee stability of banks. Purpose of the article: This paper aims to describe the methodology used to measure banking stability, namely banking stability index (BSI) and Z-score. In the first part, we present the literature review, then we try to assess the stability in the condition of the Czech Republic and Slovakia during the period 2006-2016. Methods: The BSI is constructed according to the methodology presented by Ghosh (2011), taking into account the main components, which are described by the set of financial indicators of banks. The results according to countries have showed that the tendency of development in the Czech and Slovak banking sector was the same. At the beginning of the analyzed period, the Slovak banks were more stable compared to Czech ones. Since 2009 the situation has been different, where the Czech banks could be considered as more stable compared to Slovak ones. The tendency of development of Z-score in both countries could be considered as the same, without the 2009 year, when the Czech banks significantly strengthened their capitalization, which influenced the development of Z-score. The results of correlation analysis between Z-score and BSI pointed to the fact that there was no high correlation between these two measures, therefore it is appropriate to use both methodologies for stability evaluation.

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An Evaluation of Financial Stress for Islamic Banks in Indonesia Using a Bankometer Model

Cited by 6 publications

References 15 publications

Evaluation of Nigerian Deposit Money Banks’ Soundness: Bankometer Model

Evaluation of Nigerian Deposit Money Banks’ Soundness: Bankometer Model

Efforts to Increase Core Capital for Core Capital Bank Group Base on Regulation

The evaluation of stability of Czech and Slovak banks

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