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Article
Publication date: 6 June 2022

Rania Mousa and Peterson K. Ozili

The purpose of this paper is to analyze Grameen America's response to COVID-19 pandemic. This is accomplished by identifying and analyzing the key initiatives implemented by…

Abstract

Purpose

The purpose of this paper is to analyze Grameen America's response to COVID-19 pandemic. This is accomplished by identifying and analyzing the key initiatives implemented by Grameen America within the framework of selected United Nations' Sustainability Development Goals (UN’s SD Goals).

Design/methodology/approach

This study has used qualitative content analysis to analyze financial and nonfinancial information of Grameen Bank.

Findings

This study follows a qualitative content analysis method to precisely gauge the shift in Grameen’s strategy and focus, as well as to assess the impact of its initiatives on the small business community before and after the pandemic. The findings showcase that Grameen’s longstanding mission to alleviate poverty is in line with the UN’s SD Goal 1. Also, Grameen’s commitment to create partnerships with external organizations to offer credit and noncredit services and support is consistent with UN’s SD Goal 17.

Research limitations/implications

Notwithstanding the significant contributions of this case study, the findings are limited in some respects. First, this case study focuses on the Grameen America’s unique experience regarding its response to COVID-19 pandemic. This may affect the interpretation and generalization of the findings of this study. Performing comparative views across wide range of relevant microlending institutions could help improve the generalization of the findings. Also, this case study examines the impact on women and minority groups who were particularly affected by the pandemic. The results should, therefore, be interpreted with care as circumstances may change over time.

Practical implications

The implication for practice is that policymakers should encourage the creation of more member-based financial and non-financial institutions that can help members integrate financially and socially into society. Also, practitioners should increase their ethical duties and responsibilities to their members in society in good and bad times as members tend to value the ethical aspect of financial businesses.

Social implications

The social implication of the findings is that helping members of society to cope with the difficulties brought about by COVID increased the sense of belonging among members and made them feel cared for, thereby increasing financial and social inclusion among underserved people.

Originality/value

Prior literature addressed the initiatives of microlending institutions such as Grameen Bank to achieve financial inclusion among financially vulnerable women. This case study contributes to the literature on financial inclusion and poverty alleviation by examining Grameen America’s response to the pandemic by identifying and assessing Grameen America (GA’s) key initiatives and their impact within the framework of the UN’s SD Goals in the post COVID-19 world.

Details

International Journal of Ethics and Systems, vol. 39 no. 3
Type: Research Article
ISSN: 2514-9369

Keywords

Article
Publication date: 26 February 2024

Rosli Said, Mardhiati Sulaimi, Rohayu Ab Majid, Ainoriza Mohd Aini, Olusegun Olaopin Olanrele and Omokolade Akinsomi

This study aims to address the critical need for innovative financing solutions in the global housing sector, focusing specifically on Malaysia’s distinct housing finance system…

Abstract

Purpose

This study aims to address the critical need for innovative financing solutions in the global housing sector, focusing specifically on Malaysia’s distinct housing finance system encompassing both conventional and Islamic loans. The primary objective is to develop a transformative housing finance model that addresses affordability challenges and reshapes the Malaysian housing landscape.

Design/methodology/approach

The study presents an alternate housing finance model for Malaysia, integrating lower monthly payments and reduced household debt. Key variables include house price appreciation rates, interest rates, initial guarantee fees and loan-to-value ratios. Inspired by the Help to Buy (HTB) scheme, the model aligns with proven global initiatives for enhanced affordability, balancing payment amounts, loan interest rates and acceptable price thresholds.

Findings

The study’s findings promise to address affordability disparities and reshape Malaysia’s housing finance landscape. The emphasis is on introducing a structured repayment plan that offers a sustainable path to homeownership, particularly for low-income families. Incorporating the future value adaptation concept, inspired by reverse mortgages and Islamic finance, enhances adaptability, ensuring long-term sustainability despite economic shifts.

Practical implications

The proposed model promotes widespread access to homeownership, offering practical solutions for policymakers to improve affordability, prompting adaptable risk management strategies for financial institutions and empowering potential homebuyers with increased flexibility.

Originality/value

The study introduces a transformative housing finance model for Malaysia, merging elements from reverse mortgages, Islamic finance and the HTB scheme, offering potential applicability to similar systems globally.

Details

International Journal of Housing Markets and Analysis, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1753-8270

Keywords

Article
Publication date: 4 April 2023

Chao Ren, Xiaoxing Liu and Ziyan Zhu

The purpose of this paper is to test the invulnerability of the guarantee network at the equilibrium point.

Abstract

Purpose

The purpose of this paper is to test the invulnerability of the guarantee network at the equilibrium point.

Design/methodology/approach

This paper introduces a tractable guarantee network model that captures the invulnerability of the network in terms of cascade-based attack. Furthermore, the equilibrium points are introduced for banks to determine loan origination.

Findings

The proposed approach not only develops equilibrium analysis as an extended perspective in the guarantee network, but also applies cascading failure method to construct the guarantee network. The equilibrium points are examined by simulating experiment. The invulnerability of the guarantee network is quantified by the survival of firms in the simulating progress.

Research limitations/implications

There is less study in equilibrium analysis of the guarantee network. Additionally, cascading failure model is expressed in the presented approach. Moreover, agent-based model can be extended in generating the guarantee network in the future study.

Originality/value

The approach of this paper presents a framework to analyze the equilibrium of the guarantee network. For this, the systemic risk of the whole guarantee network and each node's contribution are measured to predict the probability of default on cascading failure. Focusing on cascade failure process based on equilibrium point, the invulnerability of the guarantee network can be quantified.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 13 October 2022

Yane Chandera

The author examines the presence of foreign currency effects and the risk-mitigation channel through which a foreign-currency denomination reduces the loan spread.

Abstract

Purpose

The author examines the presence of foreign currency effects and the risk-mitigation channel through which a foreign-currency denomination reduces the loan spread.

Design/methodology/approach

The author runs regression analyses using loan data of firms incorporated in member countries of the Association of Southeast Asian Nations (ASEAN) from 2000 to 2020. The author also runs several robustness tests to address forward exchange rate bias, endogeneity concern and sample-selection bias.

Findings

Consistent with the currency matching motive of foreign debt use, the results show that a foreign currency denomination is associated with a lower spread and the relationship is amplified when there is a positive correlation between the changes in the return on assets and in the exchange rate.

Research limitations/implications

This paper enriches existing studies on the use of foreign debt as an exchange rate risk management tool.

Practical implications

The results suggest that as firms utilize foreign debt and policymakers need to design banking regulations that not only oversee but also encourage the use of foreign debt as a hedging instrument to lower firms' borrowing costs.

Originality/value

This paper contributes to extant studies by examining the presence of foreign currency effects in emerging countries' loan markets and by exploiting the micro-level demand-side factors as the channel through which the currency denomination affects the loan spread.

Details

International Journal of Managerial Finance, vol. 19 no. 5
Type: Research Article
ISSN: 1743-9132

Keywords

Article
Publication date: 26 August 2022

Masresha Belete Asnakew and Minale Kassahun Amogne

The accessibility of housing for many purposes is more influenced by the functioning of housing market. As access to housing is an expensive and long-term exertion of household…

Abstract

Purpose

The accessibility of housing for many purposes is more influenced by the functioning of housing market. As access to housing is an expensive and long-term exertion of household, looking for appropriate housing fund is necessary whether the source of fund is private saving or mortgage. However, insufficient finance in Ethiopia is a reason for inaccessible of land and housing by the low- and middle-income people. This study aims to identify the barriers to access finance in the study area.

Design/methodology/approach

This study adopted a qualitative and quantitative research approach to investigate the barriers of housing finance. To undertake and increase the relevance of this study, primary and secondary, qualitative and quantitative data were used. Primary data were collected from respondents; focal person’s and key informants. Both descriptive statistical analysis and relative importance index analysis was deployed for this study. In addition, the quantitative data were analyzed using logistic regresion model.

Findings

The result of this study found that in Ethiopia at all, there is no enough mortgage and long-term lending banks. The result of this study inspects some variables significantly affect the access to finance. The result of this study will help the government in buildup of financial institutions in many perspectives. Financial institutions and clients may also be beneficiary through stiffen housing finance system.

Originality/value

The barriers of access to finance were not sufficiently studied in Ethiopia. Therefore, this study may be a pioneer for the researchers, as it did not cover the whole area of the country to study and also appoint the government to reform the financial sector based on the findings of the researches.

Details

International Journal of Housing Markets and Analysis, vol. 16 no. 6
Type: Research Article
ISSN: 1753-8270

Keywords

Open Access
Article
Publication date: 29 September 2022

Angel Barajas, Victor Krakovich and Félix J. López-Iturriaga

In this paper, the authors study the failure of Russian banks between 2012 and 2019.

Abstract

Purpose

In this paper, the authors study the failure of Russian banks between 2012 and 2019.

Design/methodology/approach

The authors analyze the entire population of Russian banks and combine a logit model with the survival analysis.

Findings

In addition to the usual determinants, the authors find that not-failed banks have higher levels of fulfillment of the Central Bank requirements of solvency, liquidity, provide fewer loans to their shareholders and own more shares of other banks. The results of this study suggest an asymmetric effect of the strategic orientation of banks: whereas the proportion of deposits from firms is negatively related to the probability of failure, the loans to firms are positively related to bankruptcies. According to this research, the fact of being controlled by a foreign bank has a significant negative relationship with the likelihood of failure and moderates the effect of bank size, performance and growth on the bankruptcy likelihood.

Practical implications

On the whole, the results of this study support the new Central Bank rules, but show that the thresholds imposed by the Russian regulator actually do not make a difference between failed and not failed banks in the short and medium term.

Originality/value

The authors specially focus on the effectiveness of new rules issued by the Central Bank of Russia in 2013.

Details

European Journal of Management and Business Economics, vol. 32 no. 3
Type: Research Article
ISSN: 2444-8451

Keywords

Article
Publication date: 3 August 2022

Salman Ahmed Shaikh

This paper aims to discuss the views of scholarship in South Asia regarding Riba and Riba-free finance, including the conservative and realist schools in mainstream thought and…

Abstract

Purpose

This paper aims to discuss the views of scholarship in South Asia regarding Riba and Riba-free finance, including the conservative and realist schools in mainstream thought and the assimilative and interpretive schools in liberal thought.

Design/methodology/approach

The paper uses textual analysis to critically review the writings of scholars in South Asia on contemporary issues regarding Riba and Riba-free finance. It provides a critical review in the light of Islamic jurisprudence and extant Islamic economics literature.

Findings

There are several characteristics in conventional banking and finance products that do not comply with Islamic teachings. In this scenario, Islamic banking is comparatively a better alternative to conventional banking and finance products to achieve Shari’ah compliance and avoid indulging in Riba.

Practical implications

Voluntary financial exclusion to avoid Riba is significant in Muslim-majority countries. Increased penetration of Islamic finance requires clarity on what is Riba and confidence in Riba-free alternatives. Outreach efforts of Islamic financial institutions use conventional banking as a frame of reference to provide a critique of interest-based banking. However, the apprehensions within the Islamic finance literature also need to be answered to change perception and enhance people’s willingness to use Islamic banking. Doing this can expedite the process of financial inclusion as well as help in the transformation of the economy on Riba-free foundations in a reasonably quick timeframe.

Originality/value

This is the first study to critically evaluate the financial proposals presented and propagated by the contemporary interpretive school in South Asia.

Details

International Journal of Ethics and Systems, vol. 39 no. 2
Type: Research Article
ISSN: 2514-9369

Keywords

Article
Publication date: 14 August 2023

Murad Abuaddous

This paper aims to examine the impact of the mandatory adoption of (International Financial Reporting Standards [IFRS] 9) on loan provisions, nonperforming loans (NPL) and…

Abstract

Purpose

This paper aims to examine the impact of the mandatory adoption of (International Financial Reporting Standards [IFRS] 9) on loan provisions, nonperforming loans (NPL) and impairment loan loss in Gulf banks. This study also investigates potential variations in outcomes compared to prior models and explores the use of the Callaway and Sant’Anna (2021) estimator for difference-in-differences (DiD) with multiple time periods.

Design/methodology/approach

The research is based on a sample of 53 Gulf banks covering the period from 2012 to 2020. The study analyzes the changes in loan provisions, impairment loss and NPL following the implementation of IFRS 9. It uses statistical analysis and the DiD method to compare the outcomes between the experimental group (treated by IFRS 9) and the control group (not treated).

Findings

The findings reveal a statistically insignificant increase in loan provisions, impairment loss and NPL after the adoption of IFRS 9. These results align with previous studies and suggest that Gulf banks were proactive in anticipating and mitigating the impact of the new standard. The study also observes a synchronization of provisioning practices across Gulf countries and a certain level of consistency in recognizing loan losses.

Practical implications

The practical implications of this study suggest that Gulf banks have successfully absorbed the impact of IFRS 9 and have implemented collaborative approaches.

Originality/value

The study offers some new sight into IFRS9 outcomes in developing countries and opens the door for implementing a novel DiD estimation in future research studies.

Details

Journal of Islamic Accounting and Business Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 20 March 2023

Grant Richardson, Ivan Obaydin and Pamela Fae Kent

Considering the importance of environmental lawsuits in the capital market specifically and society more generally, the authors examine whether environmental lawsuits are related…

Abstract

Purpose

Considering the importance of environmental lawsuits in the capital market specifically and society more generally, the authors examine whether environmental lawsuits are related to the cost of bank loans for the first time.

Design/methodology/approach

This study uses a US sample of 7,684 loans from 1,409 individual borrowing firms over the 1995–2015 period. The hypothesis is tested using lagged data from the year before the start of a bank loan, and firm fixed effects panel regression analysis is applied to control for correlated omitted variable bias. To further address endogeneity concerns, the authors use a difference in differences analysis that exploits the Deepwater Horizon oil spill on April 20, 2010, to establish causality. Finally, the authors use the entropy balancing method as an additional endogeneity check.

Findings

The authors find a positive relationship between environmental lawsuits and firms' bank loan costs. The results are economically significant. In particular, a one standard deviation increase in environmental lawsuits is related to a 2.07 basis point increase in bank loan costs. The results are robust to various endogeneity checks. Cross-sectional analyses indicate that a poor information environment, weak corporate governance, and low corporate social responsibility (CSR) levels strengthen the positive relationship between environmental lawsuits and bank loan costs. Finally, additional analyses show that environmental lawsuits are significantly negatively related to the loan amount and maturity contract provisions.

Originality/value

The authors provide new empirical evidence that increasing understanding of the economic consequences of environmental lawsuits on bank loan costs.

Details

Journal of Accounting Literature, vol. 45 no. 3
Type: Research Article
ISSN: 0737-4607

Keywords

Article
Publication date: 28 February 2023

Babu G. Baradwaj, Michaël Dewally, Liu Hong and Yingying Shao

The purpose of this study is to investigate the impact of religiosity on banks’ lending behavior during the COVID-19 pandemic in the USA.

Abstract

Purpose

The purpose of this study is to investigate the impact of religiosity on banks’ lending behavior during the COVID-19 pandemic in the USA.

Design/methodology/approach

This study uses the evidence from the issuance of Paycheck Protection Program (PPP) loans to relate local religiosity to banks’ participation in the PPP loan program and to banks’ loan portfolio performance during the pandemic.

Findings

The results of this study show that banks located in more religious counties have a higher level of lending through the PPP, supporting the ethical and moral concerns cultivated by local religious beliefs. In addition, banks’ lending before the pandemic is more prudential in more religious areas, as reflected in lower losses and higher returns at the onset of the crisis, especially in areas where business activities were most disrupted, supporting the stewardship role encouraged by religiosity.

Originality/value

Thanks to the structure of the PPP loans programs, the authors are able to disentangle the conflicting effects of morality and prudence on banks’ behavior.

Details

Studies in Economics and Finance, vol. 40 no. 3
Type: Research Article
ISSN: 1086-7376

Keywords

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