Financial Stability of GCC Banks in the COVID-19 Crisis: A Simulation Approach

Al-Kharusi, Sami; Murthy, Y. Sree Rama

doi:10.13106/jafeb.2020.vol7.no12.337

Cited by 11 publications

(5 citation statements)

References 9 publications

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“…Likewise, the banking and financial sectors’ financial performance measured in several studies, consistently, the outcomes revealed that financial sector performance has declined; and the demand for several types of loans was diminished, at the same time the operation and lending risk has been increased significantly (Li et al , 2021; Elnahass et al , 2021). The results were consistent with Al-kharusi and Murthy (2020), as they identified that the Gulf Council Committee banks witnessed a significant negative trend in profitability and massive credit losses; which is also consistent with other study results (Dwiarti et al , 2021; Rababah et al , 2020).…”

Section: Theoretical Background and Hypotheses Developmentsupporting

confidence: 91%

“…Several studies have been carried out to investigate and measure the current pandemic’s implications on the firms’ financial performance (Al-Kharusi and Murthy, 2020; Ball, 2020; Elnahass et al , 2021; Vogel, 2020; Weaver, 2020). For instance, Song et al (2021) measured the COVID 19 implications on the restaurant sector in the USA; the study’s outcomes evidenced that the pandemic has significantly harmed the liquidity and higher the operational risks.…”

Section: Theoretical Background and Hypotheses Developmentmentioning

confidence: 99%

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Impact of COVID-19 on financial performance of logistics firms: evidence from G-20 countries

Atayah

Dhiaf²,

Najaf

et al. 2021

JGOSS

111

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Purpose This study aims to contribute to the extant literature on logistics by investigating the interrelationship between the financial performance of listed logistics firms and the COVID-19 and compare the logistics firms’ financial performance of G-20 countries during the pandemic period. Design/methodology/approach To conduct the confirmatory analysis by testing the hypotheses formulated for this study, data have been collected from Bloomberg of all logistics firms from G-20 countries. This paper gathered the first quarter from 2010 until the last quarter of 2020 as the research sample to examine the pandemic impact on financial performance. Findings The results show that the financial performance of logistic firms was significantly higher during 2020. Overall, the country-wise findings corroborated with the main results and the financial performance of 14 countries’ logistic firms out of 20 ones analysed has been significantly elevated, during the pandemic period. However, this paper has found out a negative financial performance of the logistics firms during the COVID-19 period in six countries (Germany, Korea, Russia, Mexico, Saudi Arabia and the UK), which support the second proposition. Research limitations/implications The study’s results were important as they highlighted the role of logistics firms in offering insights to academics, practitioners, policymakers and logistic firms’ stakeholders. For future research, this paper suggests including some other variables that might influence firm performance and that have not been considered in this study, which is a limitation, and going more deeply into the logistics sector by comparing the financial performance of the sub-sectors. Practical implications As the importance of logistics services during the pandemic period is relevant, this study may provide significant insights because the logistics firms play a crucial role by anticipating to ensure the supply of essential items such as food, medicine, then supporting for the continuity of supply chains. The view of finance impacts during the pandemic may provide insightful perspectives for logistics companies, allowing them to understand those impacts and better prepare for likely disruption events such COVID-19 pandemic. Originality/value This paper is novel considering that it is unique in evaluating logistics firms’ financial performance from a global perspective, considering the context of this historical pandemic.

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Section: Theoretical Background and Hypotheses Developmentsupporting

confidence: 91%

Section: Theoretical Background and Hypotheses Developmentmentioning

confidence: 99%

Impact of COVID-19 on financial performance of logistics firms: evidence from G-20 countries

Atayah

Dhiaf²,

Najaf

et al. 2021

JGOSS

111

View full text Add to dashboard Cite

show abstract

“…Additionally, Al-Kharusu and Murthy [68] found that several banks experienced financial instability during periods of economic turbulence caused by COVID-19. e findings of Elnahass et al [69] showed that the COVID-19 outbreak brought detrimental impacts on financial performance and financial stability in the global banking system.…”

Section: Discussionmentioning

confidence: 99%

The Impact of Intellectual Capital on Bank Profitability during COVID‐19: A Comparison with China and Pakistan

Haris

Irfan

2022

Complexity

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This study aims to examine how the relationship between intellectual capital (IC) and bank profitability changed during COVID-19. Based on the data of 34 Chinese banks and 39 Pakistani banks, this study uses ordinary least squares (OLS) to examine this relationship during the COVID-19 era. Profitability is measured by return on assets (ROA) and return on equity (ROE), and IC is measured by the value added intellectual coefficient (VAIC) model. The findings show that, even during the COVID-19 pandemic, IC has managed to sustain its positive influence on bank profitability in China and Pakistan. Among IC components, our study reports that human capital is the only IC resource that continues to enhance ROA and ROE of Chinese and Pakistani banks during the pandemic period. Our study suggests that policymakers should pay more attention to IC resources, which has the potential to improve banks’ profitability even during crisis times.

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“…When large banks become unstable and vulnerable, they usually stop lending, and the credit crunch can cause the economy to fall into recession or slow growth [6]. Inspired by the above facts and arguments, the objective of this paper is to provide a comparative commentary on the actual impact of the COVID 19 pandemic on the significant Gulf Cooperation Council banks before and during this global pandemic crisis.…”

Section: Introductionmentioning

confidence: 99%

A Comparative Financial Performance of the GCC ’s Largest Banks During the Pandemic

Kharusi

Murthy

2022

jour

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This paper investigates the financial performance of the largest Gulf Cooperation Council (GCC) banks by total assets before and during the recent COVID‑19 pandemic. The purpose of the study was to identify the impact of the COVID‑19 pandemic on banks’ financial performance. Financial ratios analysis during the period 2017–2020 is employed to measure the financial performance of the largest GCC banks mainly based in Saudi Arabia, Qatar, United Arab Emirates, Kuwait, Oman, and Bahrain. The ratios cover key performance areas such as profitability, efficiency, liquidity, asset quality, asset risk, and expense management. Two significant developments in 2020 are the COVID‑19 pandemic and severe drop in oil prices, both of which led to a sharp drop in the region’s GDP growth rate from an average of –0.09% in year 2019 to –5.9% in 2020, which in turn is expected to negatively impact bank performance. Using paired samples t-test the research study found statistically significant results that the financial performance of all banks suffered on almost all the key parameters in 2020 compared to the earlier period which can explained by the decline in economic activity due to COVID‑19. The focus of this study and its conclusions are novel to the extent that there are no country specific studies related to impact of COVID 19 on the biggest banks in a country. Further as far as the authors know there are no studies on the topic of impact of COVID‑19 on big banks operating in the Gulf cooperation council countries. The conclusions of the study would of importance to the regulators who would not like the big banks to fail.

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Financial Stability of GCC Banks in the COVID-19 Crisis: A Simulation Approach

Cited by 11 publications

References 9 publications

Impact of COVID-19 on financial performance of logistics firms: evidence from G-20 countries

Impact of COVID-19 on financial performance of logistics firms: evidence from G-20 countries

The Impact of Intellectual Capital on Bank Profitability during COVID‐19: A Comparison with China and Pakistan

A Comparative Financial Performance of the GCC ’s Largest Banks During the Pandemic

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