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This chapter introduces the KontoSensor, a digital service offered by Deutsche Bank since September 2018, as an example of data processing using predictive analytics. We present the motivation behind this digital service, the use cases and methods currently implemented, the way they have been created, and measures to increase the usage of the KontoSensor. With KontoSensor, Deutsche Bank offers a digital service to its clients to analyze their transactions on their current accounts using methods from predictive analytics and to inform them when irregularities are found. Twelve months after the start, 90,000 clients are already using this service and experiencing the results of data science firsthand.

The 2007 BIS Triennial Central Bank Survey of Foreign Exchange and Derivatives Market Activity Report shows a substantial increase in turnover in foreign exchange and OTC derivatives markets. Turnover in traditional FX markets increased to reach $3.2 trillion. The largest contributor to this 71% increase between April 2004 and April 2007 occurred in FX swaps. It was like a prelude to the financial crisis of 2007–2008 driven by transactions carried out between banks and other financial institutions due to the significance of hedge funds and major engagement of emerging market currencies which have sought new configurations of portfolio diversification worldwide.

In the last decades, many of the most talented and promising young graduates in the developed economies have joined the financial industry. Simultaneously, ill-designed incentives’ schemes have favored the development of a culture in which excessive greed, free-riders’ behavior, unreasonable appetite for risk, and short-term decision making have endangered the economy and, potentially, have laid the foundations for financial, economic, social, and environmental crises.

In this chapter, we review current challenges in the financial industry from the lens of human and social capital. We examine some of the factors that allowed unethical behavior and a short-term financial focus in the financial sector, examining how compensation and an extremely competitive culture became key elements that favored greedy and manipulative behavior and ultimately generated socially harmful human and social capital in the financial sector. Finally, we discuss the emergence of a number of game-changers (namely, Brexit, FinTech, the growing relevance of ethical standards, and the increasing participation of women and millennials in the industry) that might represent potential promotors of change and help restructure and reshape the financial industry.

The purpose of this chapter is to demonstrate how blockchain technology – which permits the Internet-based exchange of value (digital assets) – enables supply chain finance banks to overcome the challenges they face when attempting to create win–win transactions for supply chain participants. Traditionally, buyers and suppliers linked together in a supply chain have conflicting objectives as manifested by a zero-sum payoff structure. Suppliers want their invoices to be paid quickly in order to reduce their need for working capital. In contrast, buyers want to delay payment of invoices as long as possible in order to reduce their need for working capital. In other words, suppliers want a short cash conversion cycle; buyers want a long cash conversion cycle. This conflict is eliminated by the insertion of a financial intermediary (supply chain finance bank) between the buyer and the supplier. The bank eliminates the conflict by: (1) using its balance sheet to decouple the cash conversion cycles of the buyer and supplier; and (2) providing cheaper financing to impatient suppliers and reluctant buyers (since the bank has a higher credit rating than both the supplier and the buyer).

Purpose – This research analyses the stability of a number of banks operating in Malaysia by using descriptive statistical analysis based on internal variables. These include the characteristics of the bank, capital adequacy ratio, ratio of profitability, liquidity ratio and the ratio of bank operations.

Methodology/approach – Each bank’s stability is studied using z-score analysis. Data are sourced from the balance sheets and income statements of the banks from 2000 to 2011.

Findings – The results indicate that characteristics of a bank do influence a bank’s performance. There are significant differences in financial ratios between Islamic and conventional banking. Islamic banks provide a lower loan loss of capital to cover impaired loans than conventional banks. This provides high capital based on the mean value obtained. The capital ratio allows both sets of banks to meet the capital adequacy ratio set by the Central Bank of Malaysia. Meanwhile, in profitability ratios, conventional banks have higher returns on higher assets, whereas Islamic Banking has higher returns on higher equity. Only 8 Islamic banks and 11 conventional banks are highly stable banking institutions in Malaysia.

Originality/value – Islamic and conventional banking systems in Malaysia need further improvement to deal with unexpected economics crises and increased competition between the two. Hence, Islamic banking must be refined, especially for improving their stability to attract more investments for further development and performance.

The world’s so-called developed countries of the West have long economic and political history compared to those of the East. The developed countries are far away from today’s developing countries in terms of aggregate income, aggregate capital formation, total number of human capital, etc. Though some countries from the East have outpaced some of the Western countries in terms of gross domestic product (GDP), aggregate bank credit and capital formation, in the twenty-first century, such as China and India, they are far behind in terms of per capita income, per capita financial facilities and per capita capital stock. On the other hand, the countries from the East, except a few one, are also well lagging behind their Western counterparts in the level of human development. With the theme of the book on the growth and developmental aspects of credit allocations, the present chapter makes an introduction to the subject area by means of credit histories in the selected 10 countries and their phase-wise levels of GDP, credit and Human Development Index (HDI). The figures for GDP, credit and HDI reflect the rising trends in GDP and credit for all in the entire phase but there are some downfalls in the GDP and credit during the phase of the global financial crisis. Besides, it observes rising trends of HDI in all the countries but the rates of rise are more in the case of the developing countries. There are thus the possibilities of getting correlations among the different pairs of the variables across the countries.