scholarly journals INFLUENCE OF TECHNOLOGICAL ORIENTATION ON PERFORMANCE OF CONVENTIONAL AND ISLAMIC BANKING IN KENYA

2020 ◽  
Vol 5 (1) ◽  
pp. 1
Author(s):  
Saleh Anyango Osore ◽  
Dr. Patrick Karanja Ngugi, Phd ◽  
Dr. Kennedy Ogollah, Phd
Keyword(s):  
Factor Analysis ◽  
Dimension Reduction ◽  
Commercial Banks ◽  
Mixed Methods Research ◽  
Banking Sector ◽  
Primary Data ◽  
Islamic Banking ◽  
Latent Constructs ◽  
Independent Variable ◽  
Technological Orientation

Purpose: The research was done to establish the influence of technological orientation on performance of Conventional and Islamic banking in Kenya.Methododology: The study adopted a mixed methods research design based on descriptive, non-experimental and causal approaches. This study considered a census that targeted a population of all the forty three (43) commercial banks that were operational in Kenya as at 31st December 2016. The commercial banks also consist of Islamic banks which offer Shari’ah compliant products and services. This study used a questionnaire as the main instrument for primary data collection. Data preparation started start by coding and cleaning, the primary data obtained from the questionnaires were checked for omissions, legibility and consistency before being coded for analysis. Processed data was analysed by using both descriptive and inferential statistics. Stata version 15 was be used for statistical analysis and presentation tables of the results processed in Microsoft excel. Descriptive analysis was done for the observed indicators and presented as frequency, percentages, mean and standard deviation to reveal the distribution trends. The data collected was in the form of observed indicators of larger constructs thus multivariate dimension reduction techniques (factor analysis) was be used to form composite latent constructs. The latent constructs generated after dimension reduction were used for statistical modelling.Results: The findings indicated that Technical Orientation was considered as an independent variable and dimension of Strategic Orientation. It was considered to have 3 dimensions Services, Products and Research and Development. The latent construct technical orientation yielded from factor analysis dimension reduction of the indicators was then used as an independent variable in a regression model fitted against firm performance which showed that it was not a significant level-2 random covariate but had a significant coefficient estimate at the respondent level (level-1). The coefficient of technical orientation on performance at level one was found to be 0.828 which implied that increasing the levels of TO by a unit would increase the banks Performance by 0.828 regardless of the banking system.Unique Contribution to Theory, Practice and Policy: The researcher recommended that the Kenyan banking sector should embrace Technology in order to tap in the untapped market through innovations for the customers to be able to conduct banking businesses at their own convenience.

Islamic bank selection criteria in Nigeria: a model development

2019 ◽  
Vol 11 (6) ◽  
pp. 1837-1849
Author(s):  
Precious Chikezie Ezeh ◽  
Anayo D. Nkamnebe
Keyword(s):  
Factor Analysis ◽  
Exploratory Factor Analysis ◽  
Selection Criteria ◽  
Model Development ◽  
Reliability And Validity ◽  
Primary Data ◽  
Islamic Banking ◽  
Islamic Ethics ◽  
Content Type ◽  
Islamic Bank

Purpose The purpose of this study is to develop a model for the study of Islamic bank choice and to test the significant importance of the constructs that influence bank customers to choose Islamic bank in a pluralistic-secular nation. Design/methodology/approach Total of 348 conventional and Islamic bank customers were sampled. Five-point Likert-type question containing 27 bank selection items was used in collecting primary data. Cronbach’s alpha, composite reliability and average variance extracted are used to test the reliability and validity of the instrument. Also various descriptive statistics, exploratory factor analysis and one sample T-test are equally used in analyzing the work. Findings Exploratory factor analysis identified four factors. They are Islamic ethics, convenience, Islamic bank services awareness and physical evidence. Furthermore, the factors that show significant importance in the choice of Islamic banking are Islamic ethics and Islamic bank services awareness. The result equally shows that people are aware of Islamic banking. Practical implications This study provides insight on the factors that influence the selection of Islamic banking, an innovative banking concept. This study has obvious management and theory implications. Also, the study will assist the bank managers in developing effective marketing strategy to increase the market share. Originality/value This study reports Islamic banking selection criteria in a pluralistic-secular Nation. The study also developed a model that can be used in studying the choice of Islamic bank in special type of environment. Thus, Islamic banking is a new reality in the Nigerian financial scene.

scholarly journals Gender Inequality and Human Resource Management (HRM) Practices in Jordanian Commercial Banks

2020 ◽  
Vol 10 (1) ◽  
pp. 369
Author(s):  
Mohamad Noor Al-Jedaiah
Keyword(s):  
Human Resource Management ◽  
Human Resource ◽  
Gender Inequality ◽  
Commercial Banks ◽  
Banking Sector ◽  
Commercial Banking ◽  
Simple Random Sample ◽  
Women Empowerment ◽  
Hrm Practices ◽  
Independent Variable

This research aims at investigating the inequality practices against women in Jordanian commercial banking sector. To reach this objective, the research studied both HRP and inequalities faced women. The questionnaire was used as a tool to collect data. The HRP used as independent variable, while the inequalities resulted used as dependent variable. Simple random sample was selected of female bankers. The results showed that inequality practices existed in banking workplace. These inequalities resulted from both, the HRP and managers’ evaluation of women in baking sector. The results showed the inequality practices are source of minimizing women empowerment in banking sector.

scholarly journals BANK RUN AND STABILITY OF ISLAMIC BANKING IN INDONESIA

2017 ◽  
Vol 3 (1) ◽  
pp. 25-60 ◽  
Author(s):  
Rahmatina A. Kasri ◽  
Tika Arundina ◽  
Kenny D. Indraswari ◽  
M. Budi Prasetyo
Keyword(s):  
Factor Analysis ◽  
Financial Stability ◽  
Banking System ◽  
Bank Runs ◽  
Primary Data ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Bank Run ◽  
Banking Stability ◽  
Conventional Banks

Bank run is an important economic phenomenon which increasingly occurred in in modern banking system and potentially threatened banking stability as it could trigger a banking crisis. However, most studies related to bank run focus on the occurrence of bank run in conventional banking system. Very few of them discuss the bank run phenomenon under Islamic banking system or dual banking system where Islamic banks jointly operating with conventional banks. Therefore, this study attempts to analyze the determinants of bank run in the Indonesian Islamic banking industry by employing primary data from 256 customers of Indonesia Islamic banks in 2015 and by utilizing factor analysis and descriptive statistics. In theory, Islamic banks tend to be more resilient towards any macroeconomic or financial shocks as compared to conventional banks due to the nature of its asset-based and risk-sharing arrangement. However, the result exhibits that both psychological and fundamental factors (i.e. macroeconomics and bank fundamentals) strongly influence the behaviors of Islamic banking depositors to withdraw their funds, which might trigger the occurrence of bank runs in the country. Insider information, macroeconomic condition and bank fundamental factors are also shown to have the highest impacts among all variables. Hence, in the context of banking stability, the finding implies that Islamic banks are not completely immune to the impacts of macroeconomic shocks or financial crisis. As a country with a dual banking system, Indonesia had experienced several bank runs since 1990s. Therefore, the findings of the study should provide the policy makers important insight into research based-policy in order to attain financial stability as one of the main economic goals of the country.Keywords: Bank run, Islamic bank, Factor analysis, IndonesiaJEL Classification: C83, G21, G28

scholarly journals Mergers and Acquisitions: Does it really Enhance Managerial Commitment? Evidence from Commercial Banks in South East Nigeria

2013 ◽  
Vol 6 (2) ◽  
pp. 776-783
Author(s):  
Onwumere Josaphaet U.J ◽  
Onodugo Vincent A ◽  
O.C Ugbam ◽  
Imo Godwin Ibe ◽  
Oge Monanu
Keyword(s):  
Mergers And Acquisitions ◽  
Commercial Banks ◽  
Banking Sector ◽  
National Development ◽  
Total Sample ◽  
Working Environment ◽  
Primary Data ◽  
Survey Method ◽  
The Impact ◽  
Mergers And Acquisition

Corporate mergers and acquisition has become a highly popular strategy in recent years. Thus, much attention has been focused on its outcomes. It has served as a substitute for innovation, a greater means of diversification. The banking sector is often referred to as an engine growth of the economy. The intermediation role which the sector plays in national development cannot be overemphasized. Thus, given the recent consolidation exercise in the Nigerian banking sector, we explored the impact of mergers and acquisition on managerial commitment in this paper. We adopted the descriptive survey method and primary data were obtained using oral interview and questionnaire. The population of this study comprised all consolidated banks in Nigeria and the total sample size for this study was 384 respondents from commercial banks in South East Nigeria. The Chi-square (X2) non-parametric statistic was used to test the hypotheses. The results revealed that mergers and acquisitions have significant positive effect on managerial role and commitment of managers of commercial banks in Nigerias South East Region. We, therefore, recommend that incentive measures such as improved pay and good working environment should be promoted in commercial banks during mergers and acquisitions as these will further enhance managerial commitment.  

scholarly journals Credit Management Practices and Loan Performance: Empirical Evidence from Commercial Banks in Kenya

2020 ◽  
Vol 2 (1) ◽  
pp. 51-63
Author(s):  
Irene Muthoni Mburu ◽  
Lucy Wamugo Mwangi ◽  
Stephen M.A Muathe
Keyword(s):  
Commercial Banks ◽  
Management Practices ◽  
Banking Sector ◽  
Banking System ◽  
Secondary Data ◽  
Bank Loan ◽  
Primary Data ◽  
Credit Management ◽  
Lending Policy ◽  
Debt Collection

Commercial banks in Kenya as per the World Bank report were recording higher non-performance in loans over the study period than the standard globally in spite of Kenya having the most stable and developed banking system in East and Central Africa region. Commercial banks non-performing loans for five years from 2015 to 2018 averaged eleven percent which was higher than the recommended rate of one percent. In Kenya, commercial banks’ non-performing loans remain higher than the recommended rate which could be due to inadequate credit management practices. The study therefore aimed at examining the effect of credit management practices on loan performance of commercial banks in Kenya. Specifically, the study sought to establish the effect of debt collection policy, client appraisal and lending policy on the loan performance of commercial banks in Kenya. The underpinning theory of the study was the 5Cs model for credit. The study used explanatory research design and the research philosophy adopted was positivism. The target population was 44 commercial banks in Kenya and a census approach was used. Both primary and secondary data were used. Primary data was collected through structured questionnaires and related to credit management practices while secondary data was obtained from review of existing bank loan records in relation to loan amount advanced and non-performing loans for a period of four years from 2015-2018. The data collected was analyzed using both descriptive and inferential statistics with the help of SPSS version 22. The study found out that debt collection policy and lending policy had a positive significant effect on loan performance of commercial banks in Kenya. However, client appraisal had no significant effect on loan performance of commercial banks in Kenya. Therefore, the study concluded that commercial banks’ loan performance could be largely attributed to the efficiency of the credit management practices put in place at the institutions. The study recommended that commercial banks to regularly evaluate and update practices relating to debt collection policy, client appraisal and lending policy that are capable of ensuring that credit risks are identified and recorded from departmental level to the institution at large. This is vital in light of technological innovations in the banking sector like mobile lending that may limit commercial banks’ ability to evaluate and manage credit using traditional methods.

Sharia’h practice at Islamic banks in Pakistan

2018 ◽  
Vol 9 (3) ◽  
pp. 274-289
Author(s):  
Muhammad Tariq Majeed ◽  
Abida Zainab
Keyword(s):  
Risk Sharing ◽  
Banking Sector ◽  
Islamic Law ◽  
Banking Industry ◽  
Supervisory Board ◽  
Primary Data ◽  
Equation Modeling ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Content Type

PurposeIslamic banks provide an alternative financial system based on Sharia’h (Islamic law). However, critics argue that operation at Islamic banks is violating Sharia’h particularly in terms of provision of interest free services, risk sharing and legal contract. The purpose of this paper is to empirically evaluate the Sharia’h practice at Islamic banks in Pakistan by considering some basic principles of Sharia’h. Design/methodology/approachPrimary data are collected from 63 branches of Islamic banks in Pakistan. Questionnaire is used as an instrument. The study uses structural equation modeling that includes confirmatory factor analysis and regression analysis. Data are codified and analyzed using SPSS and Amos. FindingsThis study finds that Islamic banks are providing interest free services, ensuring that transactions and contracts offered by Islamic banks are legal and offering conflict-free environment to customers. In contrast, estimated results expose that Islamic banks are not sharing risk and Sharia’h supervisory board is not performing its role perfectly. Similarly, it is found that organization and distribution of zakat and qard-ul-hassan are weak at Islamic banks. Research limitations/implicationsData are collected from Islamabad federal capital of Pakistan that hold just 5 per cent share of Islamic banking industry. This small share may not provide true picture of Islamic banking sector. Practical implicationsTo ensure risk sharing, Islamic banking industry must consider the development of new modes of financing and innovation of more products based on Sharia’h. State Bank of Pakistan should ensure separate regulatory framework that enable Islamic banks to provide qard-ul-hassan, organize and allocate zakat. Originality/valueThis paper discusses the perception of bankers, who are actually the executors, about Shariah’s practices at Islamic banks in Pakistan. There are not many discussions on this topic that could be found, and hence this could be considered as a significant contribution by this paper to the existing literature of Islamic finance.

scholarly journals Financial and Non-Financial Measures in Evaluating Performance: The Role of Strategic Intelligence in the Context of Commercial Banks in Kenya

2020 ◽  
Vol 13 (10) ◽  
pp. 130
Author(s):  
Blandina Walowe Kori ◽  
Stephen M. A. Muathe ◽  
Samuel Mwangi Maina
Keyword(s):  
Balanced Scorecard ◽  
Commercial Banks ◽  
Banking Sector ◽  
Secondary Data ◽  
Annual Reports ◽  
Primary Data ◽  
Balanced Score Card ◽  
Financial Measures ◽  
Strategic Intelligence

This study provides comprehensive discussion on role of strategic intelligence in commercial banks, in Kenyan context. The primary focus was to evaluate the performance of commercial banks using both financial and non-financial performance measurers. The financial measurers comprised return on equity (ROE), while non-financial measures were customer satisfaction, learning and growth, and internal processes. The study was anchored on resource-based view and balanced scorecard model. The target population comprised 40 commercial banks. Additionally, the sample size 181 was selected proportionately through stratified sampling procedure. Data collection instruments comprised closed and open -ended questionnaires and online review. The study used both primary and secondary data, where primary data was obtained from Kenya commercial banks head offices, while secondary data, for the year 2016 – 2018, was obtained from the annual reports of the central bank of Kenya. Data analysis was done using descriptive statistics and linear multiple regression analysis. Findings of the study indicate that strategic intelligence has a statistically significance on the performance of commercial banks in Kenya. Moreover, both financial and non-financial measures of performance are relevant in the banking sector and growth of Kenyan economy. The study recommends that commercial bank in Kenya should integrate their training focus and strategy implementation with investors interests based on balanced score card.

ANALISIS PROFITABILITAS TERHADAP BEBAN RISIKO OPERASIONAL PERBANKAN SYARIAH DI PANDEMI COVID-19

2021 ◽  
Vol 10 (2) ◽  
pp. 118-131
Author(s):  
Muhlis ◽  
Izzatun Maghfirah ◽  
Dewi Puspita Sari
Keyword(s):  
Regression Analysis ◽  
Financial Services ◽  
Commercial Banks ◽  
Secondary Data ◽  
Operational Risk ◽  
Islamic Banking ◽  
Economic Sector ◽  
Business Units ◽  
Banking Institutions ◽  
Independent Variable

The Covid-19 pandemic that happened in Indonesia certainly affected many aspects of life, including the economic sector. Furthermore, in Islamic banking institutions, this institution serves as an intermediary between the collection and distribution of funds to customers. So that the pandemic can affect this sector in financial performance, especially in the profitability of institutions. In this study, profitability uses the ROA ratio in both Islamic Commercial Banks and Sharia Business Units, as well as operational risk burden as an independent variable. The data used in this study is secondary data from the official website of the Financial Services Authority which was analyzed using multiple regression analysis, classical assumption test, and determinant coefficients in SPSS. The results showed that the ROA BUS and UUS variables did not have a significant effect on the operational risk burden, while the determinant coefficient showed 44.9%.

Impact of Interest Rate Changes on the Profitability of four Major Commercial Banks in Pakistan

2014 ◽  
Vol 4 (1) ◽  
pp. 142 ◽  
Author(s):  
Waseem Ahmad Khan ◽  
Abdul Sattar
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Commercial Banks ◽  
Banking Sector ◽  
Pearson Correlation ◽  
Correlation Method ◽  
Economic Stability ◽  
Independent Variable ◽  
The Interest Rate ◽  
The Impact

The core objective of this project is to analyze the impact of interest rates changes on the profitability of commercial banks being operated in Pakistan by examining the financial statements of four major banks during 2008 to 2012. Like the efficiency of banking sector is considered most important for economic growth, monetary policy implementation and macro-economic stability. From the past few years, interest spread of banking sector of Pakistan is rising. As a result variations in the interest rate depress the savings and investment and on the other hand it increases the efficiency of banks’ lending. In this paper interest rate is an independent variable and bank profitability is a dependent variable. To examine the impact of interest rate changes on the profitability of commercial banks in Pakistan, Pearson correlation method is used in this study. As a result it is found that there is strong and positive correlation between interest rate and commercial banks’ profitability. It means if the value of interest rate is increases/decreases then as result value of banks’ profitability will also increases/decreases.

scholarly journals IDENTIFYING THE FACTORS DETERMINING OF MUSLIMS’ INTENTION TO ADOPT ISLAMIC BANKING IN THE LOCAL REGION: RELIGIOSITY AS MODERATING VARIABLE

2020 ◽  
Vol 8 (2) ◽  
pp. 482-487
Author(s):  
Isnurhadi ◽  
Zakaria Wahab ◽  
Fida Muthia ◽  
Abdul Bashir
Keyword(s):  
Social Influence ◽  
Local Region ◽  
Primary Data ◽  
Islamic Banking ◽  
Intention To Use ◽  
Islamic Banks ◽  
Muslim Community ◽  
Intention To Adopt ◽  
Factors Influencing ◽  
Independent Variable

Purpose of the study: This paper investigates factors that influence the Muslims’ intention to adopt Islamic banking and to examine whether religiosity moderates the effect of those factors toward the Muslim's intention to adopt Islamic banking in South Sumatera. Methodology: Primary data collected from six towns/districts in South Sumatera are obtained through questionnaires with the total respondents of 300. Using multiple regression analysis, we test whether attitude, social influence, bank reputation, and compliance on Islamic principles can affect the Muslims’ intention in using Islamic banking. Main Findings: We further crosscheck our findings through an interview with some of the respondents. We find that attitude, reputation, and compliance affect the intention to adopt Islamic banking significantly, whereas social influence is found to be insignificant. Our further finding explains that religiosity, which is represented by the dimension of Syariah and Ahlaq, cannot moderate the effect of an independent variable on the dependent variable. Implications of this study: This implies that in increasing Islamic bank market share, managers of Islamic banks and also government cannot solely depend on religious factors. Our findings give insights to practitioners and regulators on what factors can affect Muslims’ intention to use Islamic banking. Novelty/Originality of this study: This study contributes as it extends the existing literature, any factors influencing the interest and intention of the Muslim community to adopt sharia banking as their banking activities. Some studies look at the direct effect of religiosity toward Islamic banking, however, it is different from previous studies because we put religiosity as a moderating variable.

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