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1 – 10 of over 22000
Article
Publication date: 1 April 1997

Roger Bennett

Three hundred and sixty‐seven members of the general public were interviewed in Surrey and Greater London in an attempt to ascertain whether they employed the representativeness…

Abstract

Three hundred and sixty‐seven members of the general public were interviewed in Surrey and Greater London in an attempt to ascertain whether they employed the representativeness heuristic when interpreting the corporate personas of UK building societies and banks. The representativeness heuristic is a simple decision‐making rule whereby an individual draws inferences about an organisation according to how closely it is perceived to resemble other organisations regarded as typical of a particular group (‘banks’ for example). It emerged that many respondents did indeed apply the representativeness heuristic in this context, resulting in their ignoring or paying little attention to a specific item of objectively useful information. The findings of previous research which concluded that building societies have ‘warmer’ and friendlier images than conventional banks are generally supported. An important observation was that building societies which in recent years have converted themselves into banking PLCs are still regarded by large numbers of people as possessing the same image attributes as unconverted building societies.

Details

Journal of Communication Management, vol. 2 no. 2
Type: Research Article
ISSN: 1363-254X

Keywords

Article
Publication date: 16 November 2010

Robert Webb, Cormac Bryce and Duncan Watson

This paper aims to investigate the effect of UK building society demutualisation on levels of efficiency at the largest five commercial banks in the UK.

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Abstract

Purpose

This paper aims to investigate the effect of UK building society demutualisation on levels of efficiency at the largest five commercial banks in the UK.

Design/methodology/approach

This research utilises data envelopment analysis (DEA) within a rarely adopted windows framework to analyse efficiency. The study also incorporates a novel risk proxy in the profit‐orientated approach to determine DEA input/output which proves a useful innovation to the methodology.

Findings

The overall aggregate results suggest that converting building societies outperformed their bank counterparts in all areas of efficiency and that scale efficiency dominates pure technical efficiency. Interestingly, the results also indicate that the level at which institutions continue to find economies of scale had increased when compared to previous research.

Originality/value

The period of building society demutualisation offers an empirical opportunity to examine deregulation upon market participants. It is felt that this study offers academics, regulators and participants within the financial services environment an insight into the efficiency impact of deregulation.

Details

Journal of Financial Regulation and Compliance, vol. 18 no. 4
Type: Research Article
ISSN: 1358-1988

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Article
Publication date: 14 October 2009

Hongwei He and Yehuda Baruch

The objective of this paper is to report a case study investigating how organizational identity evolves during institutional change within a UK building society.

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Abstract

Purpose

The objective of this paper is to report a case study investigating how organizational identity evolves during institutional change within a UK building society.

Design/methodology/approach

The paper employs an inductive case study, which is appropriate for examining such change processes. It builds on grounded theory, considered appropriate for such an explanatory research.

Findings

The paper finds that: institutional change, especially regulation and practice changes, serves as the trigger to increasing salience of identity issues, i.e. identity ambiguity, legitimacy crisis and perceived identity obsolescence; leadership, organizational culture and strategic exercises are salient apparatuses to tackle identity problems caused by external pressure; and a new identity is formed as a result of the managerial interventions, characterised by the rediscovery of historical roots, modernization and dualism.

Research limitations/implications

The paper provides an account of identity change, given a broader business environment change context within which the organization operates. Utilizing qualitative study of one case may be taken as a limitation.

Originality/value

The theoretical contribution reflected in the findings has implications for the interfaces between identity and institutional environment and organizational culture.

Details

Journal of Organizational Change Management, vol. 22 no. 6
Type: Research Article
ISSN: 0953-4814

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Article
Publication date: 10 April 2009

Robin Klimecki and Hugh Willmott

This paper aims to examine the influence of neoliberalist deregulation on the rash of demutualisations of the 1990s. It explores the extent to which the demutualisation of two…

2821

Abstract

Purpose

This paper aims to examine the influence of neoliberalist deregulation on the rash of demutualisations of the 1990s. It explores the extent to which the demutualisation of two building societies – Northern Rock and Bradford & Bingley – and their subsequent demise in the wake of the credit crunch exemplify key features of the neoliberalist experiment, with a particular focus on their post‐mutualisation business models.

Design/methodology/approach

The analysis draws on literature that examines the neoliberal development of the financial sector and examines the media coverage of the financial crisis of 2007/2008 to study the discursive and material conditions of possibility for the development and implosion of the business models used by Northern Rock and Bradford & Bingley.

Findings

The paper argues that the demutualisation of Northern Rock and Bradford & Bingley was part of a broader neoliberal movement which had processes of financialisation at its centre. By converting into banks, former building societies gained greater access to wholesale borrowing, to new types of investors and to the unrestricted use of financial instruments such as securitisation. The collapse of Northern Rock and Bradford & Bingley is interpreted in the light of their access to these new sources of funding and their use of financial instruments which were either unavailable for, or antithetical to, the operation of mutual societies.

Research limitations/implications

The paper comments on the contemporary features and current effects of the 2007/2008 crisis of liquidity, whose full long‐term consequences are uncertain. Further research and future events may offer confirmation or serve to qualify or correct its central argument. The intent of the paper is to provide a detailed analysis of the conditions and consequences of building society demutualisation in the context of the neoliberal expansion of the financial sector that resulted in a financial meltdown. It is hoped that this study will stimulate more critical analysis of the financial sector, and of the significance of financialisation more specifically.

Originality/value

The paper adopts an alternative perspective on the so‐called “subprime crisis”. The collapse of Northern Rock and Bradford & Bingley is understood in relation to the expansion, and subsequent crisis, of financialisation, in which financial instruments such as collateralized debt obligations and credit default swaps were at its explosive centre, rather than to the expansion of subprime lending per se. Demutualisation is presented as a symptom of neoliberalism, a development that, in the UK, is seen to have contributed significantly to the financial meltdown.

Details

Critical perspectives on international business, vol. 5 no. 1/2
Type: Research Article
ISSN: 1742-2043

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Article
Publication date: 1 March 2002

John K. Ashton

The paper considers two central issues; one, how was the definition of the UK banking market undertaken within the Cruickshank Report, and two, how might the assumptions made in…

Abstract

The paper considers two central issues; one, how was the definition of the UK banking market undertaken within the Cruickshank Report, and two, how might the assumptions made in defining banking markets have influenced the competition analysis and overall conclusions presented by the report. In this paper, the banking market for personal customers is discussed in relation to theoretical and empirical work and the distribution of banking branches in the UK. An assessment of the form of competition, used in the Cruickshank Report, builds on this discussion and considers the implications of a possible oversight in the definition of the UK banking market. Recommendations and suggestions for further work are provided within the conclusions.

Details

Journal of Financial Regulation and Compliance, vol. 10 no. 1
Type: Research Article
ISSN: 1358-1988

Keywords

Article
Publication date: 13 November 2009

Maximilian J.B. Hall

The purpose of the paper is to explain how UK bank failure resolution policy has evolved since the nationalisation of Northern Rock in February 2008 in the light of the fallout…

4691

Abstract

Purpose

The purpose of the paper is to explain how UK bank failure resolution policy has evolved since the nationalisation of Northern Rock in February 2008 in the light of the fallout from the sub‐prime crisis and the subsequent credit crunch.

Design/methodology/approach

The evolution of the UK authorities' approach, from a piecemeal approach to a comprehensive, system‐wide approach, is traced through analysis of the treatment accorded the troubled entities Alliance and Leicester, HBOS (both the subject of separate officially brokered takeover‐rescues) and Bradford and Bingley (eventually nationalised, like Northern Rock) prior to consideration of the two industry‐wide bailout schemes introduced in October 2008 and January 2009.

Findings

Confounding initial hopes, Northern Rock proves to be just the first of a series of major institutional casualties of the fallout from the sub‐prime crisis, eventually necessitating a comprehensive and system‐wide solution. While this successfully prevents the system from literally collapsing in the Autumn of 2008, in the wake of the decision not to rescue Lehman Brothers in the USA, it fails to stimulate lending, as intended. Accordingly, a second industry bailout package was introduced in January 2009, but even this may fail to secure the main goals of intervention‐financial stability and a resuscitation of bank lending to support the ailing economy‐heralding possible further state inroads into domestic bank ownership.

Originality/value

The paper clearly identifies the need for, and nature of, both the ad hoc and system‐wide solutions adopts to deal with individual cases of institutional “failure” and the wider stability concerns, respectively. The authorities' actions are subject to critical analysis, while a personal assessment of both the House of Commons Treasury Committee's report on Northern Rock and the tripartite authorities' reform proposals, which culminate in the Banking Act of 2009, is also provided.

Details

Journal of Financial Regulation and Compliance, vol. 17 no. 4
Type: Research Article
ISSN: 1358-1988

Keywords

Article
Publication date: 13 July 2010

Jane Ball

The purpose of this paper is to show the different attitudes to bank ownership and regulation, residential lending and eviction in the UK and France, with their effects in the…

Abstract

Purpose

The purpose of this paper is to show the different attitudes to bank ownership and regulation, residential lending and eviction in the UK and France, with their effects in the credit crunch and how these factors are connected. UK non‐interventionism stems from a history of private banking, where competition produced plentiful finance but high risks for borrowers, where eviction is certain and fairly quick, but not necessarily disastrous for borrowers within a flexible system. The French history of post‐war interventionism for reconstruction and cautious banking has had successes and failures, culminating in large‐scale special loans to lower‐income borrowers, improving lending liquidity and stability. The French lower lending levels, intervention and caution can be partly explained by the disastrous effects of French debt and eviction processes on borrowers, but with overlay of delay and social protection.

Design/methodology/approach

The paper uses a historical institutionalist approach, calling on historical materials, statistics (where available) and the law and procedure of banking, mortgages, eviction and insolvency. Quantitative comparison of mortgage evictions is difficult, but procedures illuminate this.

Findings

National approaches to banking are path dependent and this effect is underestimated, particularly concerning attitudes to public intervention and eviction. Awareness of these connected effects could improve comparative research to assist lending to lower income groups, particularly concerning special French loans.

Practical implications

This can improve open‐mindedness, and promote ideas to house young people rather than simply calling for heavy regulation in the UK, or criticising French interventionism.

Originality/value

Comparative evictions related to the history of banking intervention are considerably understudied. The paper addresses the issues.

Details

International Journal of Law in the Built Environment, vol. 2 no. 2
Type: Research Article
ISSN: 1756-1450

Keywords

Article
Publication date: 1 July 2006

Laura A. Costanzo and John K. Ashton

Within the UK, low levels of saving has been a continuing policy concern for both government and financial regulators. Why individuals save less than might be expected has been…

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Abstract

Purpose

Within the UK, low levels of saving has been a continuing policy concern for both government and financial regulators. Why individuals save less than might be expected has been increasingly associated with an inability of ma… financial services consumers to comprehend product quality and to underta… of firms in this debated through examining the product choices presented to consumers by financial services providers.

Design/methodology/approach

We examine two aspects of poor consumer decision making, yet to be fully explored in the wider regulatory literature. Initially, we review how financial services providers consider product innovations and the marketing strategies they pursue in constructing their offerings to consumers. Secondly, we ass… a popular financial product, the interest bearing deposit account, to examine what savings product choices are actually presented to consumers. These areas are explored through semi‐structured interviews undertaken with semi financial services managers and through a review of the entire product offerings to the interest bearing deposit market.

Findings

We report that savings markets are characterised by high product turnover and short duration. Consumers in the UK, alike many developed nations, and often unfamiliar with, and lack confidence when, buying savings products. Example consumers often have difficulties when making product comparis… Faced by so much proliferation of undifferentiated products, consumers find difficult to make a straightforward comparison between products.

Research limitations/implications

It is concluded that further public education, a greater understanding of ho… firms present product choices to consumers and how consumers perceive s… choices are areas demanding further research and consideration.

Originality/value

Consideration of how firms make decisions with regard to product innovation and savings problem more generally is an area demanding further investigation from a range of disciplinary approaches. Finally, given the perceived high importance of financial services to individuals and the nation… economy at large, some scrutiny should be placed on the issue of the high profitability of the financial services industry and how this is reflected into product innovations and, therefore, differentiated quality choices presented various categories of consumers.

Details

Journal of Financial Regulation and Compliance, vol. 14 no. 3
Type: Research Article
ISSN: 1358-1988

Keywords

Book part
Publication date: 2 November 2009

Leigh Drake and Adrian R. Fleissig

This chapter examines factors that cause violations of regularity conditions and biases in estimates of substitution. In the context of the Fourier demand system, failing to…

Abstract

This chapter examines factors that cause violations of regularity conditions and biases in estimates of substitution. In the context of the Fourier demand system, failing to impose curvature restrictions but correcting for serial correlation results in few violations of the curvature conditions. In contrast, imposing curvature restrictions without correcting for serial correlation biases substitution estimates and can cause violations of monotonicity. For serially correlated data, results suggest that correcting for serial correlation may be more important than imposing curvature. Furthermore, the artificially break-adjusted data that are inconsistent with consumer optimization can severely bias estimates. Results from the Bank of England's (BOE) preferred non-break-adjusted data establish that money and goods are substitutes in demand.

Details

Measurement Error: Consequences, Applications and Solutions
Type: Book
ISBN: 978-1-84855-902-8

Article
Publication date: 1 February 1997

John Storey, Peter Cressey, Tim Morris and Adrian Wilkinson

Presents and discusses findings from a major study of changing employment practices in UK banking. Uses case studies to explore different patterns of reaction to a fast and…

4679

Abstract

Presents and discusses findings from a major study of changing employment practices in UK banking. Uses case studies to explore different patterns of reaction to a fast and radically changing business environment. Addresses important questions including the nature of the changes to human resource management practices, the extent and depth of these changes and, most importantly, the degree to which the different banks are following similar or divergent paths. Offers explanations for the findings under each of these headings.

Details

Personnel Review, vol. 26 no. 1/2
Type: Research Article
ISSN: 0048-3486

Keywords

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