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Internet + and Electronic Business in China is a comprehensive resource that provides insight and analysis into E-commerce in China and how it has revolutionized and continues to revolutionize business and society. Split into four distinct sections, the book first lays out the theoretical foundations and fundamental concepts of E-Business before moving on to look at internet+ innovation models and their applications in different industries such as agriculture, finance and commerce. The book then provides a comprehensive analysis of E-business platforms and their applications in China before finishing with four comprehensive case studies of major E-business projects, providing readers with successful examples of implementing E-Business entrepreneurship projects.

Internet + and Electronic Business in China is a comprehensive resource that provides insights and analysis into how E-commerce has revolutionized and continues to revolutionize business and society in China.

This chapter investigates the presence of a difference in the systemic risk level between Islamic and conventional banks in Bangladesh. The authors compare systemic resilience of three types of banks: fully fledged Islamic banks, purely conventional banks (CB), and CB with Islamic windows. The authors use the market-based systemic risk measures of marginal expected shortfall and systemic risk to identify which type is more vulnerable to a systemic event. The authors also use ΔCoVaR to identify which type contributes more to a systemic event. Using a sample of observations on 27 publicly traded banks operating over the 2005–2014 period, the authors find that CB is the least resilient sector to a systemic event, and is the one that has the highest contribution to systemic risk during crisis times.

Standard financial risk management practices proved unable to provide an adequate understanding and a timely warning of the financial crisis. In particular, the theoretical foundations of risk management and the statistical calibration of risk models are called into question. Policy makers and practitioners respond by looking for new analytical approaches and tools to identify and address new sources of financial risk. Financial markets satisfy reasonable criteria of being considered complex adaptive systems, characterized by complex financial instruments and complex interactions among market actors. Policy makers and practitioners need to take both a micro and macro view of financial risk, identify proper transparency requirements on complex instruments, develop dynamic models of information generation that best approximate observed financial outcomes, and identify and address the causes and consequences of systemic risk. Complexity analysis can make a useful contribution. However, the methodological suitability of complexity theory for financial systems and by extension for risk management is still debatable. Alternative models drawn from the natural sciences and evolutionary theory are proposed.

Purpose – Investigate the causes and consequences of foreign financial institutions' divestments in China's banking sector which is an example of cross-border transactions by institutional investors.

Methodology – Use a sample of 26 foreign financial institutions' strategic investments in Chinese banks. Ten of those investments are divested after the global financial crisis. We investigate determinants of the divestment, business cooperation after the divestment, and Chinese banks' stock price reactions to the divestment announcement.

Findings – The poor performance of foreign financial institutions, which is attributable to the global financial crisis, and the institutions' regulated low equity ownership are important causes of divestment (or whole divestment). In contrast, Chinese banks' poor performance does not cause foreign divestments. Foreign financial institutions that fully divest their equity stakes usually terminate their cooperative business, which was required by the strategic investment agreement. The Bank of China and the China Construction Bank, which experienced large H-share divestments, experienced large economic declines in A-share values.

Social implications – Foreign financial institutions' strategic investments created substantial shareholder value before the divestment. Banking sector developments that rely on foreign investments are vulnerable to economic downturns in developed countries.

Originality/value of paper – To the best of our knowledge, this is the first trial to analyze the impact of divestments on divested bank performance.

This study explores the interrelationship between regulatory risks and strategic controls within the financial supervision architecture of an emergent global financial centre of China that embraces innovation as part of its strategic objectives.

This paper employs a longitudinal case study approach to examine the institutional dynamics of the key financial regulators in connection with the regulated financial institutions in Hong Kong before and after the financial tsunami of 2008.

First, this study reveals an organic development of a specialised financial regulatory architecture that resists transforming itself structurally despite the significant impact of externalities. Second, in this post-financial crisis analysis, regulated financial institutions swiftly respond by strengthening their risk controls through compliance with the guidelines imposed by the regulator. Institutional dynamics in influencing the implementation of risk controls through a top-down interactive mechanism are observed. Such dynamic and pertinent rapid responses induce the pursuit of optimal risk management within a regulatory framework.

This paper provides a longitudinal case study to reveal regulatory risks and strategic controls of the global financial centre of China. It unveils mitigating risk control measures in the aftermath of the global financial crisis. The study demonstrates how regulatory institutions strive to take precautionary, coercive measures such that the regulated institutions mimic and implement prudent mechanisms.

Purpose: This chapter explores some of the difficult issues in financial regulation for financial stability. Noting the lack of prior academic work in the topic, this chapter presents a discussion of some difficult issues in financial regulation for financial stability.

Methodology: The chapter draws from real-world experiences in financial regulation and draws support from existing literature.

Findings and conclusions: Some of the difficult issues include: the difficulty in breaking too-big-to-fail financial institutions into small insignificant parts; the difficulty in regulating executive compensation in the financial sector without limiting the ability of financial institutions to offer competitive pay for executive talent; difficulty in instilling strict financial regulation and supervision without limiting the ability of financial institutions to exploit emerging profitable opportunities; difficulty in ensuring that financial institutions increase lending in bad times and during recessions; the rarity of having both a female CEO and Chair in a major financial institution; difficulty in making Central Banks independent from the Federal Government; difficulty in making financial institutions relevant in the midst of hostile technological innovation and disruption.

Practical implications: The implication of the findings is that financial regulation for financial stability is not an easy task. There will be issues that financial regulation can address, and there will be issues that financial regulation cannot address. Acknowledging that such difficulties exist on the path to financial stability is the first step to addressing these issues.

The purpose of this chapter is to review the risks Islamic financial institutions face in an emerging market context, including risk sharing in Islamic financing and Shari’ah (Islamic law) compliance risk. We explore current risk management practices and establish the link between risk management and the financial performance of banks and the efficiency and effectiveness of financial sectors in emerging markets. Because of their distinctive risk profile, Islamic finance institutions face challenges in risk management. We show that Islamic banking is riskier in emerging markets because of the presence of immature money markets, limitations in the availability of lender of last resort facilities, and deficiencies in market infrastructure. There is also no evidence that Islamic banks have developed effective solutions for managing the risks conventional banks face as well as their own unique risks. We suggest that the countries that do this best are those that prioritize the structure of risk management knowledge and capabilities in a single financial regulator.

In this chapter we study the intra-group transactions between the parent bank and its foreign subsidiaries in European Union (EU) countries during the crisis. We use hand-collected data from annual statements on related party transaction and find that they may create a serious problem for the stability of the foreign banks’ subsidiaries. Moreover, as some of those subsidiary banks were large by assets in some of the member states the related party transactions with the parent bank created a serious threat to the host countries’ financial system stability. We attribute this transaction to the weak governance in foreign subsidiaries. We suggest improvements in governance as well as greater disclosure of related party transactions in bank holding companies in Europe.