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This chapter investigates a shock transmission path between a home country (a country where globalized banks’ headquarters are located) and a host country (Indonesia as the emerging market) through the lending channel of global banks’ local branches (i.e., the internal transfer channel). Using novel data of monthly individual foreign bank’s balance sheet in Indonesia, the author finds the evidence that shocks to a parent bank and a home economy are transmitted to a host economy through the foreign banks’ internal capital market. With the Indonesia banks’ capital injections and their difficulty in financing dollar funds without risk premiums since the 1998s crisis, the foreign banks’ dollar lending in Indonesia is a good showcase of internal capital markets. A change in a home stock market index and industrial production appears to have a negative effect on growth rates in foreign currency loans of foreign banks in the host market. On the other hand, high growth rates in the parent bank’s stock price in the home market lead to an increase in foreign banks’ US dollar lending in the host country. This effect does not appear in local currency lending because limited hedging instruments against foreign exchange risk results in immobility of bank capital in the local currency.

Purpose: This paper aims to reveal the impact of the pandemic Covid-19 on the banking and financial sector. Covid-19 is a pandemic disease that’s impacting all nations. However, its amount varies from one country to another depending on the country’s social and economic infrastructure progress. The whole world is passing through great improbability. Indian economy is also facing equivalent issues from contraction in growth to rising inflation, unemployment and low demand. Covid-19 has impacted all industries worldwide, and the financial service sector is not any exception. Covid-19, which began as a health crisis, has now been appropriated as a financial one.

Methodology: This study intends to showcase various new developments in the banking sector. In the present scenario, banks are focusing on utilising new technological innovations to reinforce their risk management competence. Since the aim is to analyse various latest developments in the banking sector and its impact during Covid-19, the focus is to collect the relevant and supporting material from every possible secondary source. To attain the main aim of this paper, the data are collected using secondary sources, i.e. data from the annual reports of the Reserve Bank of India (RBI), Security Exchange Board of India, Federation of Indian Chambers of Commerce & Industry, Organisation for Economic Co-operation and Development (OECD), the International Monetary Fund (IMF), and the World Bank and various others sources. This is taken care of on the primary basis that the reliable and authentic sources are incorporated in this study. Since the study scope is limited to analysing the new developments in the banking sector due to Covid-19, the maximum literature available to attain the paper’s objective is from 2020 to 2021.

Findings: The banking sector is among the most crucial sectors of the Indian economy, which is accountable for almost every financial activity possibly happening within the country. It acts as a holding hand to the industry involved in credit, transactions, collection, etc. With the disruption of supply chains across the globe, numerous physical business places are closed. Banks are the backbone of the economy. Their stability is critical to continue the system up and to run.

Practical implications: The banking sector aims to supply funding to anyone, say corporate or individuals. The decelerate pace can guide prospective job losses, ground stress in banks’ retail loan books. The banks should design a plan to shield employees and their customers from its spread. It has hit the scope to individuals, small- and medium-sized enterprises, and large corporate. The only obvious thing is that every group has faced an income crunch that threatens economic and financial market permanence.

Significance: The relevance of this study stands on the fact that Covid-19 has begun as a health crisis, quickly extended into a business crisis. This is often not only a health crisis but also depression. The outbreak of Covid-19 has created a huge impact on nations. The nationwide lockdowns have almost faded social and economic life. The global economy was hit hard by the continued coronavirus. The whole world is passing through great uncertainty. As a result, various services sectors, banking sectors, and financial services have suffered through various ups and downs, resulting in economic stress. The uncertain and risky environment has had a severe impact on banks’ asset quality. The coronavirus outburst influenced financial markets and consumer emotions as well.

Russia's size – both in terms of population and geography, spanning 11 time zones, 89 oblasts (states or regions) and autonomous republics and its privatization program, encompassing some 100,000 small-scale enterprises, 25,000 medium to large firms, and 300 or so of its largest firms, made its privatization program the largest sale/transfer of assets conducted among the transition economies, with the possible exception of China. Comparisons by many of the program's critics, and there are many, to Poland, Hungary, or the Czech republic are invidious, especially the latter two countries whose populations are similar to just that of greater Moscow.

The role of money and monetary policy of the central bank in pursuing macroeconomic stability has significantly changed over the period since the end of World War II. Globalization, liberalization, integration, and transition processes generally shaped the crucial milestones of the macroeconomic development and substantial features of economic policy and its framework in Europe. Policy-driven changes together with variety of exogenous shocks significantly affected the key features of macroeconomic environment on the European continent that fashioned the framework and design of monetary policies.

This chapter examines the key basis of the central bank’s monetary policy on its way to pursue and preserve the internal and external stability of the purchasing power of money. Substantial elements of the monetary policy like objectives and strategies are not only generally introduced but also critically discussed according to their accuracy, suitability, and reliability in the changing macroeconomic conditions. Brief overview of the Eurozone common monetary policy milestones and the past Eastern bloc countries’ experience with a variety of exchange rate regimes provides interesting empirical evidence on origins and implications of vital changes in the monetary policy conduction in Europe and the Eurozone.

This chapter addresses the issue of value creation in the retail banking sector, focusing on France. The author shows that since the 2007 financial crisis, banking organizations have used a disruptive innovative approach to regain the trust of retail banking customers. This innovative hybrid design is not only driven by efficiency and fully dematerialized solutions, but also considers human, social, and territorial development aspects.

This chapter is based on an EU statistical analysis (2009–2013) of two strategies used by French, Italian, and German national banks to manage the 2007 financial crisis: closing retail bank branches and lay-offs. Interestingly, in France, bank units and employee numbers fell the least. A complementary qualitative analysis of the principal banking innovations promoted by R&D directors helps to explain the main features of the French strategy to cope with the mistrust of clients and employees.

Though low-cost models are promoted as major innovations today (“banking is necessary, bankers are not”), and result in massive offshoring and restructuring levels to face new global competitors such as Google, Amazon, and PCCW-HKT, the French retail banking sector, previously state regulated but progressively deregulated, has adopted an original strategy to regain trust and loyalty. Rather than adopting these low-cost models strictly, with full dematerialization, it focuses on balanced innovation – such as the “neighbourhood bank format,” which improves knowledge of the expectations and needs of local clients and environments. These solutions are not only global or local, but a mix of both dimensions.

Global industries like finance are embedded in both territorial and historical relationships and governance. This means that they can only be observed from this dual perspective, which is a dilemma that characterizes today’s economy. Innovation decisions and design particularly illustrate the banking sector’s embeddedness, with the dichotomy between fully digitalized options and fully territorialized services. Therefore, innovation is neither a “Champion” or leadership question, nor a mere ICT option. It is a hybrid combination to restore trust and relations.

The implications of such a balanced approach to innovation are highly important in terms of offshoring, lay-offs, and outsourcing practices, which are adopted as essential, and taken for granted by owners and CEOs in global value chains such as finance.The given data and analysis give concrete means to integrate local cultural and institutional habits, so that innovation make sense to stakeholders.

This chapter suggests a critical approach to innovation strategies and trends in the finance sector.

Norway is a small nation state on the northernmost coastline of Western Europe, integrated in the Western world economy. For centuries Norway's integration in the world economy had been based on exports of raw materials such as fish and timber, as well as shipping services. In the early 20th century, furnace-based metals (made possible by cheap hydropower) were added to this export basket. Just as the world economy entered an increasingly unstable phase in 1970s, another natural resource was discovered in Norway: petroleum – that is, oil and natural gas from the North Sea. This chapter analyses the challenges and possibilities inherent in the Norwegian strategy of developing an oil economy in a world economic situation influenced by new and stronger forms of international integration through the four decades between 1970 and 2010.

This chapter examines the impact of price fluctuations in foreign stock markets on the stock prices of domestic banks in Korea, Malaysia, Singapore, and Thailand. Some studies have argued that the 2007–2009 global financial crisis (GFC) affected domestic banks less in East Asia, even though the supporting evidence is rather limited. Employing a multinomial logit model, we estimate how changes in the United States and Japanese stock markets affected the banking sectors in the sampled countries before the 1997 Asian financial crisis, and before and during the more recent GFC. We interpret the number of banks in a given country that experienced a large price shock on the same day (or “coexceedance”) as shocks to the domestic banking sector. The results suggest that fluctuations in foreign stock market indices exerted a larger impact on the prices of East Asian banking stocks during the 2000s than during the 1990s. In addition, although the shocks brought about by the deterioration of foreign stock markets were significant before the GFC, both increases and decreases in foreign stock prices significantly affected the banking sectors of the respective countries during the crisis. Lastly, we conclude that increasing foreign capital flows and foreign assets and liabilities greatly influenced domestic banking systems in East Asia during the 2000s.

Recently, Japanese commercial banks have experienced increased merger and acquisition (M&A) activity. M&As allow rapid downsizing and increased scale economies, while avoiding massive layoffs. Faced with the pressures of globalization and a difficult domestic economic environment, some Japanese banks appear to have shifted their operational focus from developing growth-enabling core competencies to reducing organizational costs. Keiretsu relationships are changing accordingly, with individual groups adapting in different ways. Most Japanese banks experienced extensive M&A activity at earlier points in their corporate histories. The recent flurry of M&As in the banking sector is nothing new, but rather a resurgence of past practices.