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Commercial banks face several risks, including credit, liquidity, operational and disruptive risks. In addition to these risks that are challenging for banks to control and manage, crises and disasters can exert substantially more destructive shocks. These shocks can exacerbate internal risks and cause severe damage to the bank's performance, leading banks to bankruptcy and closure. This study aims to facilitate achieving resilient banking policies through a model-based assessment of business continuity management (BCM) policies.

By applying a system dynamics (SD) methodology, a systemic model that includes a causal structure of the banking business is presented. To build a simulation model, data are collected from a commercial bank in Iran. By presenting the simulation model of the bank's business, the consequences of some given crises on the bank's performance are tested, and the effectiveness of risk and crisis management policies is evaluated. Vensim Personal Learning Edition (PLE) software is used to construct the simulation model.

Results indicate that the current BCM policies do not show appropriate resilience in the face of various crises. Commercial banks cannot create sustainable value for the banks' shareholders despite the possibility of profitability, as the shareholders lack adequate resilience and soundness. These commercial banks do not have the appropriate resilience for the next pandemic after coronavirus disease 2019 (COVID-19). Moreover, the robustness of the current banking business model is very fragile for the banking run crisis.

A forward-looking view of resilient banking can be obtained by combining liquidity coverage, stable funding, capital adequacy and insights from stress tests. Resilient banking requires a balanced combination of robustness, soundness and profitability.

The present study is a combination of bank business management, risk and resilience management and SD simulation. This approach can analyze and simulate the dynamics of bank resilience. Additionally, present of a decision support system (DSS) to analyze and simulate the outcomes of different crisis management policies and solutions is an innovative approach to developing effective and resilient banking policies.

The financial crisis that started in 2007 has led to a re‐thinking of financial regulation and supervision. One major lesson of the crisis is that supervisors should be “asking the big questions” (FSA). These are typically questions that are difficult to address, as they require a deep understanding of bank business models. The purpose of this paper is to provide the recent shift in prudential supervision towards the analysis of bank business models with a sound economic basis.

The paper reviews the economic literature on banking in order to answer what the authors deem to be the three central questions when analysing business models.

The bottom‐line for supervisors, in the authors' view, is that it is essential to understand where the profit comes from and what risks the bank or the banking sector is exposed to in generating those profits.

Analysing bank business models goes beyond the traditional approach to prudential supervision, which mainly focuses on the adequacy of bank capital, liquidity and risk management. The analysis of business models implies a different approach to risk, starting from understanding a bank's activities, customer groups, distribution channels and sources of profits.

This paper contributes to bridging the gap between the economic literature on banking and the needs of bank supervisors. To the authors' best knowledge, this paper is the first addressing this particular issue. By giving an overview of the recent literature on banking that is relevant for understanding bank business models it helps to provide supervisors with a sound economic basis for assessing banks' business models.

The paper provides a holistic overview of already available academic literature of mobile banking, business model innovation and ecosystem and activity system perspective of business model concepts. The purpose of this conceptual paper is to initiate a debate for future research in the agenda highlighted in this paper.

In this paper, mobile banking business ecosystem of Easypaisa is used as an illustrative case to understand mobile banking business model innovation in the context of business ecosystem and activity system perspective.

Based on Porter’s view of mobile financial service (MFS) industry, it is suggested that patterns of business model innovation can be explained through business ecosystem and activity system. The notion of business model innovation can also be explained through integrated value chain of mobile network operator and its partners in the supply chain of MFS.

This paper provides preliminary overview of the exiting academic literature on business model innovations, business ecosystem and activity system in the in the context of value network. Since this is only a literature review paper, therefore, no primary data have been collected for this case study through interviewing from the relevant people.

So far, no research has been conducted in Pakistan to address business model innovation in mobile banking sector in the context of business ecosystem and activity system perspective.

The purpose of this paper is to describe and analyze the business processes of a bank by considering a graphical and a descriptive view in order to find critical processes and to improve them.

A methodology with which the business processes are modeled based on the flow diagram (FD) and integrated definitions (IDEF0) techniques.

Detects the descriptive and graphical view of the main critical business processes of a bank. Allows to propose correct and effective improvements to them and considers different views and degrees of detail.

This study considers a static view of the processes. A future line of research includes the simulation of the critical business processes of the bank detected with the modeling techniques herein proposed.

The business process modeling techniques apply to one subsidiary of a bank company, and can thus be extended to all subsidiaries to compare their performance and to apply the improvements by considering global objectives.

This paper proposes a structured modeling to capture the critical business processes of a bank through well‐known techniques, such as the FDs and IDEF0, and helps compare and detect these relevant aspects for the bank.

Business Model Analysis is acquiring increasing visibility in the European banking regulatory framework, following the European Banking Authority guidelines on common procedures and methodologies for the supervisory review and evaluation process (SREP), developed to assess business and strategic risks (EBA, 2014, 2015a, 2015b, 2015c). Starting from a selected literature review, in the paper, the authors analyse business models set up by financial intermediaries, bank and non-banks, for the distribution of investment services, first by comparing European niche players with European banking global players, and second, comparing European niche players among themselves to understand the evolution of business models for the distribution of investment services at European level. The research is supported by the Baffi–Carefin Research Centre at the Bocconi University (Italy), in collaboration with ANASF, the Italian Association of Financial Advisors (Italy).

The authors consider a sample of European financial players from 2009 to 2014. The authors’ focus is on France, Germany, Italy, The Netherlands, Spain and the UK; overall the authors’ handmade data set is based on 162 annual reports. The authors follow two main questions: Do the niche players, as they are focused on the distribution of investment services, have an upper limit to profitability, compared to the global players, as risk-takers in many financial areas? How is the business model of niche players changing, facing increasing competition and regulatory pressures?

Answering the first research question, the highest net profitability is found in the niche players group; the global players, as risk-takers, achieve lower remuneration, in contrast with the risk premium theory. The results were assessed over a limited period, however, deemed in line with the company’s strategic planning horizon. Answering the second research question, the authors focus on the case of niche players, using a cluster analysis. The authors identify three different business models: most dynamic niche players, which combine investment services, insurance and welfare services, achieving the highest margins and stability; players mainly focused on asset management, whose key vulnerability is the degree of open architecture, especially in light of future MiFID 2 implementation; and players mainly focused on the creation of well-structured on-line platforms, which offer also brokerage services, thereby reducing their marginality and potentially increasing their business risk.

Despite the limited time series, the authors’ research gives some inputs for those interested in deepening the business model analysis focus on the distribution of investment services and the business and strategic risk assessment, both for the global banks and the niche players (banks and non-banks).

The authors’ results could be of some interest during the strategic assessment of global banks and niche players, both adopting an internal perspective or an external one, as regulator.

By giving some specific insights into the assessment and comparison of business and strategic risks among global and niche players, the authors’ research provides the basis for further research in the field of the distribution of investment services.

The originality mainly regards the business model risk perspective and the focus of the authors’ analysis: the distribution of investment services. This sector, unlike the asset management, does not have an easily recognisable group of comparables at European level, all the European countries analysed have very different business models. This research avails of an original database, that is unique to Europe.

The purpose of this paper is inductively identifying the business model of Islamic (participation) banks in Turkey via using bank characteristics, meaning balance sheet ratios.

The methodology starts from bank characteristics and ends with identification of bank business model according to these characteristics under the assumption that there is one single business model (say Model A) for all Turkish Islamic banks. What the author aims to find is the properties of this business model. Regarding the method, seven bank characteristics from liability side and five characteristics from asset side of bank balance sheets were established. While representing these characteristics, the author uses charts and tables. Necessary data are gathered from the Central Bank of Turkey. Time frame of monthly data is from December 2005 to March 2015. In total, there are 1356 observations.

Value proposition of business model of Turkish Islamic banks depends on participation in collecting funds. In terms of customer segmentation, there is dominance of private sector. While using the funds, the main preference is loans, meaning that value proposition depends on loan products, especially murabahah. Thus, revenue streams depend on mark-up. Overall, business model of Turkish Islamic banks seems similar to traditional banking based on intermediation with some peculiarities. There are also some evidences which can be interpreted as signs toward decline in this traditional role like decrease in deposits, increase in funds from financial institutions and decrease in loans.

It can be said that original idea of participation banks has been followed on the liability side of Turkish Islamic banks. However, decrease in deposits recently needs detailed investigation to create convenient policies especially by Islamic banks. Similar investigation and policy creation is needed also for the developments of increase in funds from financial institutions and decrease in loans. Furthermore, as the original idea of participation is not followed by business model of Turkish Islamic banks, rethinking and acting is needed in that regard.

Main contributions of this paper are as follows: first, it fills a gap in the field where studies regarding business model of Islamic banks are scarce. Second, it fills a gap in literature of Islamic banking in Turkey where most of the studies are about development or jurisprudence of Islamic banks. Third, it provides a decade-long evidence regarding business model of Islamic banks in Turkey. Fourth, the findings provide an initial step for the construction of a business model canvas for Turkish Islamic banks. Fifth, discussion of findings leads to number of important questions which can pave the way for new research studies.

The purpose of this paper is to examine to what extent is the impact of Basel II adoption on bank business models in the emerging market of selected ASEAN member states.

To evaluate the impact of the Basel II regulation on banking business models, a difference-in-differences estimation approach is used. This study defines bank business models using diversification index of a modified Herfindahl–Hirschman Index.

The findings suggest that the Basel II framework only affects banks’ income diversification, while there is no evidence that it leads to funding and asset diversification. Under the Basel II accord, banks have adjusted their business models by diversifying their sources of income to avoid the obligation for keeping more capital; in contrast, a less developed financial market structure and a dependency on customer deposits are creating difficulties for banks in diversifying their funding and asset structure.

The banking sample are taken only from ASEAN countries.

The findings provide important implication on the regulatory perspective, which is the implementation of Basel II framework induces higher intensity for the use of non-interest income activities. Including in these activities are trading and derivatives. Accordingly, the financial authorities should take with care the use of trading and derivatives products in the banking industry which is already embedded in current Basel framework, the Basel III Accord.

The paper provides direct evidence on the impact of Basel II on bank business models in the emerging markets of ASEAN banking sectors.

The purpose of this paper is to provide a new way of rethinking banking models by using qualitative research on intangibles. This is required because the banking sector has been transformed significantly by the changing environment over the past two decades. The 2007-2009 financial crisis also added to concerns about existing bank business models.

Using qualitative data collected from interviews with bank managers and analysts in the UK, this paper develops a grounded theory of bank intangibles.

The model reveals how intangibles and tangible/financial resources interact in the bank value creation process, how they actively respond to environmental changes, how bank intangibles are understood by external observers such as analysts, and how bankers and analysts differ in their views.

Grounded theory provides the means to further develop bank models as business models and theoretical models. This provides the means to think beyond conventional finance constructs and to relate bank models to a wider theoretical literature concerning intellectual capital, organisational and social systems theory, and “performativity”.

Such development of bank models and of a systems perspective is critical to the understanding of banks by bankers, by observers and for their “critical and reflexive performativity”. It also has implications for systemic risk and bank regulation.

The paper reveals the core role of intellectual capital (IC) in banks, in markets, and in developing theory and research at firm and system levels.

The purpose of this paper is to do an empirical analysis assessing whether banks highly involved into trading activities show specific business model choices. Key factors in the analysis are a proper measure for trading activities and a consistent classification of banks in terms of business choices.

We investigate three measures for trading activities proposed by regulators in the context of bank structural reform in Europe. Through robust statistics we identify the key trading players and classify banks into a limited number of business model clusters, relying on a set of balance sheet and income statement indicators.

Using a sample of 100 European banks in 2007-2012, results show that the measures identify similar, but not identical, sets of banks highly involved into trading. The measure proposed by the European Commission selects fewer banks and is more consistent over time. The business model analysis identifies six rather stable clusters, from small-medium retail-focused banks to very large investment groups. The measures coherently identify as key trading players the largest investment groups and select very few retailed focused banks. Differences among measures arise for very large retail-diversified and medium/large wholesale banks.

These results could feed the debate on which measures for trading regulators could consider depending on the target of the reform they would implement. For instance we show that the measure proposed by the European Commission selects less well capitalized retail-diversified banks compared to the others.

The study examines the roles of capital rules, macro variables and bank business models in determining the safety of banks as measured by the “distance-to-default” (DTD) with the purpose of drawing implications for regulation of bank capital and business models.

A panel regression study using pre- and post-crisis data for 108 US and European banks is used to explore the issue empirically. A new technique is also used to back out the amount of capital banks would have needed during the crisis to keep the “DTD” in the very safe zone.

The simple leverage ratio has a strong relationship with “DTD”, while the Basel ratio does not. The most important business model features are derivatives and wholesale funding, which have a strong negative relationship with “DTD”. Trading and available-for-sale securities have a positive influence. Calculations show that it is not possible for any reasonable capital rule to compensate for the risks created by business model features encompassing large derivative-based activities. Bank separation policies are essential.

The micro evidence-based analysis as an approach to bank regulation and business model requirements stands in contrast to the ad hoc way policy has been constructed before and after the crisis. The empirical evidence supports separation based on the balance sheet size of derivatives and a leverage ratio instead of the complex Basel risk-weighted capital approach. The current approaches to structural separation are criticised constructively, and some evidence-based suggestions for improving bank business models to reduce systemic risk are made.