Determinants of banks fragility in the MENA region using a dynamic model

Audi, Marc; Kassem, Mohamad; Roussel, Josse

doi:10.1353/jda.2021.0007

Cited by 3 publications

(8 citation statements)

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“…In our research, return on asset (ROA) is also used as a measure of bank profitability. ROA is estimated here by net income to total assets as suggested by Ali and Puah (2019), Audi et al (2021) and Mkadmi et al (2021). The influence of financial institution profitability on institutional stability was determined using NIM and ROA.…”

Section: Methodsmentioning

confidence: 99%

“…There has been an extensive debate regarding the bank insolvency in the existing literature. Since the financial globalization has been increasing rapidly, the consequences of bank insolvency might be transferred from nation to another at a fast pace (Audi et al, 2021). Governments from West Asian countries cannot readily control large-scale bank bankruptcy transfers, which can wreak havoc on stabilization efforts (Altman, 1968;De Bandt & Oung, 2004;Haldane, 2009;Hannan & Hanweck, 1988;Sinkey & Nash, 1993;Stav arek & Repkov a, 2012).…”

Section: Background and Hypotheses Developmentmentioning

confidence: 99%

“…In this study, we employ Z-score as a dependent variable. Most authors (Ali & Puah, 2019;Audi et al, 2021;Mkadmi et al, 2021;Rahman et al, 2021;Rupeika-Apoga et al, 2018;Supiyadi, 2021) calculate the Z-score as calculating the ROA with the addition the capital ratio by the standard deviation of the ROA.…”

Section: Irjmsmentioning

confidence: 99%

“…However, for the west Asian countries, it shows that there is a significant development gap between poor and industrialized nations while comparing in terms of financial stability (Svirydzenka, 2016;Them, 2009). Furthermore, during the post-crisis period, literature shows that a rigorous improvement specially in the financial stability is crucially needed for the west Asian countries (Audi, Kassem, & Roussel, 2021). This is because Asian banks perform much better than banks in other regions of the world, according to Vinayak, Lee, Rajendran and Sengupta (2016), and hence have a considerable influence on global banking stability and performance (Vinayak et al, 2016).…”

Section: Introductionmentioning

confidence: 99%

“…Ali and Puah (2019),Audi et al (2021), Mkadmi et al (2021), Muizzuddin et al (2021), Rahman et al (2021), Rupeika-Apoga et al Ali and Puah (2019), Rupeika-Apoga et al (2018), Supiyadi (2021) Size Size of financial institution (ln(TA)) Dutta and Saha (2021), Mkadmi et al (2021), Rahman et al (2021), Supiyadi (2021)…”

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confidence: 99%

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Bank stability, performance and efficiency: an experience from West Asian countries

Shahriar

Mehzabin

Ahmed

et al. 2022

IRJMS

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PurposeThe banking sector in West Asia has always experienced positive growth except for Palestine. Apart from some negligible outlying outcomes in some countries that have faced political crises and war, most West Asian countries have gained bank profitability and efficiency. However, the stability in the banking sector has been rarely examined in the literature. Hence, this study sheds light on examining bank stability by considering 12 countries in West Asia.Design/methodology/approachA fixed effect panel data regression analysis is employed on strongly balanced panel data using data from 2004 to 2018.FindingsResults reveal that the net interest margin has a positive relationship with bank stability. The bank’s stability rises as the net interest margin improves. Furthermore, the non-interest income reveals a positive significant impact on the stability of banks, depicting that the increase in non-interest income increases the stability of banks. Additionally, the non-interest expense also reveals positive significant results with the stability of banks. Nevertheless, leverage ratio and long-term debt portray a negative significant impact on banks’ stability. The finding reveals that higher long-term debt and leverage ratios may decrease the stability of the banks in West Asia.Practical implicationsOverall, the authors’ findings add to the literature on the stability of the banks by providing some new but significant information. Some of the recommendations may be beneficial to the long-term success of 12 Western Asian countries’ banks.Originality/valueThe study examines the stability of banks by incorporating both profitability and operating efficiency along with net-interest income, which extends to the current literature’s insight.

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Section: Methodsmentioning

confidence: 99%

Section: Background and Hypotheses Developmentmentioning

confidence: 99%

Section: Irjmsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

mentioning

confidence: 99%

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Bank stability, performance and efficiency: an experience from West Asian countries

Shahriar

Mehzabin

Ahmed

et al. 2022

IRJMS

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Banking Stability and Financial Conglomerates in European Emerging Countries

Vodová

Palečková²,

Stavárek³

2022

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This Element focuses on the specific role of financial conglomerates in managing banking and financial stability. The Element aims to estimate financial stability in CEE using the constructed aggregate financial stability index, to incorporate the financial stability of the parent company into the index, and to assess the effect of the parent company on the financial stability of commercial banks and national financial sectors.

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CAMELS parameters’ impact on the risk of losing financial stability: The case of Russian banks

Shershneva

2024

Journal of New Economy

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The banking sector stability determines the financial immunity of a national economy. Current economic and political tensions precondition the need for predicative diagnosis of factors behind a decrease in a bank’s financial stability taking into account national specificities. The paper aims to explore the impact of intrabank parameters on a risk of deteriorated financial stability of Russian banks. The methodological basis of the study is the theory of financial management as applied to the banking practice. The research methods include content analysis, multiple regression, and logit modelling. The evidence comes from the published financial statements of Russian banks for 2018–2023. The paper suggests an approach for rating banks according to their financial stability and develops logit models for evaluating the risk of losing financial stability based on the CAMELS parameters. The analysis demonstrates a noticeable positive impact of the return on assets and a noticeable negative effect of the overdue loans share on a bank’s financial stability. At the same time, capital adequacy and current liquidity produce an ambiguous effect on the financial strength: they are significant only up to a certain point, after passing which they no longer exert any impact on the financial stability (the so-called “surplus paradox”). The study finds that the impact of the parameters differs for the mediumand long-term forecasting horizons: for a 6-month period, the return on assets is a more significant predictor of the financial instability risk, while the overdue loans share is more important for a 12-month period. The findings extend the understanding of the influence that bank’s internal factors have on their financial stability and can be useful in building the algorithms for analysing and forecasting banking risks.

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Determinants of banks fragility in the MENA region using a dynamic model

Cited by 3 publications

References 0 publications

Bank stability, performance and efficiency: an experience from West Asian countries

Bank stability, performance and efficiency: an experience from West Asian countries

Banking Stability and Financial Conglomerates in European Emerging Countries

CAMELS parameters’ impact on the risk of losing financial stability: The case of Russian banks

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