Search results
1 – 10 of 645The increased capital requirements and the implementation of new liquidity standards under Basel III sparked various concerns among researchers, academics and other stakeholders…
Abstract
Purpose
The increased capital requirements and the implementation of new liquidity standards under Basel III sparked various concerns among researchers, academics and other stakeholders. The question is whether Basel III regulation is ideal, that is, adequate to deal with a crisis, such as the 2007–2009 global financial crisis? The purpose of this paper is threefold: First, perform a stress testing exercise on the US banking sector, while examining liquidity and solvency risk indicators jointly under the Basel III regulatory framework. Second, allow the study to cover the post-crisis period, while referring to key Basel III regulatory requirements. And third, focus on the resilience of domestic systemically important banks (D-SIBs), which are supposed to support the US financial system in times of stress and therefore whose failure causes the entire financial system to fail.
Design/methodology/approach
The authors used a sample of the 24 largest US banks observed over the period Q1-2015 to Q1-2021 and a scenario-based vector autoregressive conditional forecasting approach.
Findings
The authors found that the model successfully produces accurate forecasts and simulates the responses of the solvency and liquidity indicators to different real and historical macroeconomic shocks. The authors also found that the US banking sector is resilient and can withstand both historical and hypothetical macroeconomic shocks because of its compliance with the Basel III capital and liquidity regulations, which consist of encouraging banks to hold high-quality liquid assets and stable funding resources and to strengthen their capital, which absorbs the losses incurred in a crisis.
Originality/value
The authors developed a framework for testing the resilience of the US banking sector under macroeconomic shocks, while examining liquidity and solvency risk indicators jointly under Basel III regulatory framework, a point not yet well studied elsewhere, and most studies on this subject are based on precrisis data. The authors also focused on the resilience of D-SIBs, whose failure causes the failure of the entire financial system, which previous studies have failed to examine.
Details
Keywords
Nugroho Saputro, Putra Pamungkas, Irwan Trinugroho, Yoshia Christian Mahulette, Bruno Sergio Sergi and Goh Lim Thye
This paper investigated whether a bank’s popularity and depositors' fear of Google search volume could affect bank deposits and credit.
Abstract
Purpose
This paper investigated whether a bank’s popularity and depositors' fear of Google search volume could affect bank deposits and credit.
Design/methodology/approach
The authors used two different quarterly data from Google Trends and banking data from 2012 Q1 to 2020 Q1. Based on available data, Google Trends data start from 2012. The authors exclude data after 2020 Q1 because the Covid-19 pandemic arguably increased the volume of Internet users due to shifting behavior to online activities. They merged and cleaned the data by winsorizing at 5 and 95 percentiles to avoid any outlier problems, reaching 74 banks in the sample. They used panel data estimation of quarterly data following Levy-Yeyati et al. (2010) and Trinugroho et al. (2020).
Findings
The results show that a higher search volume of a bank’s name leads to higher deposits. A higher search volume of depositor fear reduces deposits and credit. The authors also found that banks with high risk and a high search volume of their name have a significantly lower volume of deposits.
Originality/value
To the best of the authors’ knowledge, not many papers in banking and finance have used Google Trends data to gauge related issues regarding depositors' behavior. The authors have filled a gap in the literature by investigating whether the popularity of Google search and depositors' fear could impact deposits and credit. This study also attempted to establish whether Google Trends data could be a reliable source of information to predict depositors' behavior by using a Zscore to measure bank risk.
Details
Keywords
Graeme Newell and Muhammad Jufri Marzuki
Renewable energy infrastructure is an important asset class in the context of reducing global carbon emissions going forward. This includes solar power, wind farms, hydro, battery…
Abstract
Purpose
Renewable energy infrastructure is an important asset class in the context of reducing global carbon emissions going forward. This includes solar power, wind farms, hydro, battery storage and hydrogen. This paper examines the risk-adjusted performance and diversification benefits of listed renewable energy infrastructure globally over Q1:2009–Q4:2022 to examine the role of renewable energy infrastructure in a global infrastructure portfolio and in a global mixed-asset portfolio. The performance of renewable energy infrastructure is compared with the other major infrastructure sectors and other major asset classes. The strategic investment implications for institutional investors and renewable energy infrastructure in their portfolios going forward are also highlighted. This includes identifying effective pathways for renewable energy infrastructure exposure by institutional investors.
Design/methodology/approach
Using quarterly total returns, the risk-adjusted performance and portfolio diversification benefits of global listed renewable energy infrastructure over Q1:2009–Q4:2022 is assessed. Asset allocation diagrams are used to assess the role of renewable energy infrastructure in a global infrastructure portfolio and in a global mixed-asset portfolio.
Findings
Listed renewable energy infrastructure was seen to underperform the other infrastructure sectors and other major asset classes over 2009–2022. While delivering portfolio diversification benefits, no renewable energy infrastructure was seen in the optimal infrastructure portfolio or mixed-asset portfolio. More impressive performance characteristics were seen by nonlisted infrastructure funds over this period. Practical reasons for these results are provided as well as effective pathways going forward are identified for the fuller inclusion of renewable energy infrastructure in institutional investor portfolios.
Practical implications
Institutional investors have an important role in supporting reduced global carbon emissions via their investment mandates and asset allocations. Renewable energy infrastructure will be a key asset to assist in the delivery of this important agenda for a greener economy and addressing global warming. Based on this performance analysis, effective pathways are identified for institutional investors of different size assets under management (AUM) to access renewable energy infrastructure. This will see institutional investors embracing critical investment issues as well as environmental and social issues in their investment strategies going forward.
Originality/value
This paper is the first published empirical research analysis on the performance of renewable energy infrastructure at a global level. This research enables empirically validated, more informed and practical decision-making by institutional investors in the renewable energy infrastructure space. The ultimate aim of this paper is to articulate the potential strategic role of renewable energy infrastructure as an important infrastructure sector in the institutional real asset investment space and to identify effective pathways to achieve this renewable energy infrastructure exposure, as institutional investors focus on the strategic issues in reducing global carbon emissions in the context of increased global warming.
Details
Keywords
Z. Göknur Büyükkara, İsmail Cem Özgüler and Ali Hepsen
The purpose of this study is to explore the intricate relationship between oil prices, house prices in the UK and Norway, and the mediating role of gold and stock prices in both…
Abstract
Purpose
The purpose of this study is to explore the intricate relationship between oil prices, house prices in the UK and Norway, and the mediating role of gold and stock prices in both the short- and long-term, unraveling these complex linkages by employing an empirical approach.
Design/methodology/approach
This study benefits from a comprehensive set of econometric tools, including a multiequation vector autoregressive (VAR) system, Granger causality test, impulse response function, variance decomposition and a single-equation autoregressive distributed lag (ARDL) system. This rigorous approach enables to identify both short- and long-run dynamics to unravel the intricate linkages between Brent oil prices, housing prices, gold prices and stock prices in the UK and Norway over the period from 2005:Q1 to 2022:Q2.
Findings
The findings indicate that rising oil prices negatively impact house prices, whereas the positive influence of stock market performance on housing is more pronounced. A two-way causal relationship exists between stock market indices and house prices, whereas a one-way causal relationship exists from crude oil prices to house prices in both countries. The VAR model reveals that past housing prices, stock market indices in each country and Brent oil prices are the primary determinants of current housing prices. The single-equation ARDL results for housing prices demonstrate the existence of a long-run cointegrating relationship between real estate and stock prices. The variance decomposition analysis indicates that oil prices have a more pronounced impact on housing prices compared with stock prices. The findings reveal that shocks in stock markets have a greater influence on housing market prices than those in oil or gold prices. Consequently, house prices exhibit a stronger reaction to general financial market indicators than to commodity prices.
Research limitations/implications
This study may have several limitations. First, the model does not include all relevant macroeconomic variables, such as interest rates, unemployment rates and gross domestic product growth. This omission may affect the accuracy of the model’s predictions and lead to inefficiencies in the real estate market. Second, this study does not consider alternative explanations for market inefficiencies, such as behavioral finance factors, information asymmetry or market microstructure effects. Third, the models have limitations in revealing how predictors react to positive and negative shocks. Therefore, the results of this study should be interpreted with caution.
Practical implications
These findings hold significant implications for formulating dynamic policies aimed at stabilizing the housing markets of these two oil-producing nations. The practical implications of this study extend to academics, investors and policymakers, particularly in light of the volatility characterizing both housing and commodity markets. The findings reveal that shocks in stock markets have a more profound impact on housing market prices compared with those in oil or gold prices. Consequently, house prices exhibit a stronger reaction to general financial market indicators than to commodity prices.
Social implications
These findings could also serve as valuable insights for future research endeavors aimed at constructing models that link real estate market dynamics to macroeconomic indicators.
Originality/value
Using a variety of econometric approaches, this paper presents an innovative empirical analysis of the intricate relationship between euro property prices, stock prices, gold prices and oil prices in the UK and Norway from 2005:Q1 to 2022:Q2. Expanding upon the existing literature on housing market price determinants, this study delves into the role of gold and oil prices, considering their impact on industrial production and overall economic growth. This paper provides valuable policy insights for effectively managing the impact of oil price shocks on the housing market.
Details
Keywords
Iqbal Reza Nugraha, Gumilang Aryo Sahadewo and Sekar Utami Setiastuti
This paper aims to examine the impact of COVID-19 on inflation in Indonesia. There are two questions in this study: (1) Is there an impact of COVID-19 on inflation in Indonesia…
Abstract
Purpose
This paper aims to examine the impact of COVID-19 on inflation in Indonesia. There are two questions in this study: (1) Is there an impact of COVID-19 on inflation in Indonesia? and (2) whether there are differences in the impact of COVID-19 on regional inflation in Indonesia, considering the different intensities associated with COVID-19.
Design/methodology/approach
The estimation technique showing the impact of the COVID-19 pandemic on inflation uses the difference-in-differences (DID) method described by Pischke (2008). The core idea of the estimation above is continuous DID using panel data. No province was affected by COVID-19 before 2020:Q1. Once COVID-19 hits the economy, the effects vary from one district to the other.
Findings
The authors find that the severity of the COVID-19 pandemic negatively affects inflation – the more severe the pandemic, the lower the inflation. This finding conforms with several studies suggesting higher demand pressures than supply during the pandemic. Compared with supply-side indicators such as production index, demand-side indicators – such as consumer confidence index and real sales index – fell more sharply.
Research limitations/implications
In the Introduction section, the authors have added a discussion that indeed the COVID-19 pandemic affects inflation through both the demand- and supply-side shocks. While factors driving regional differences in inflation rate are important research and policy questions, the analysis of these factors is outside the scope of this study. The study focuses on the COVID-19 impact on inflation and whether the pandemic disproportionately affects some regions than the others.
Practical implications
This research is important to provide an understanding of the nature of the pandemic on inflation in the context of the Indonesian economy, which is essential to policy formulation, especially for the Central Bank in carrying out the mandate to maintain rupiah stability. This issue is due to the implications of different policy responses between demand- and supply-side shocks.
Originality/value
As a novelty in this study and research gap, the authors use a continuous DID method to account for the varying intensity of COVID-19 across the provinces. In particular, the authors use the number of positive cases of COVID-19 per 1,000 population as opposed to just a binary indicator of before-and-during COVID-19 across provinces.
Details
Keywords
Shanaka Herath, Vince Mangioni, Song Shi and Xin Janet Ge
House price fluctuations send vital signals to many parts of the economy, and long-term predictions of house prices are of great interest to governments and property developers…
Abstract
Purpose
House price fluctuations send vital signals to many parts of the economy, and long-term predictions of house prices are of great interest to governments and property developers. Although predictive models based on economic fundamentals are widely used, the common requirement for such studies is that underlying data are stationary. This paper aims to demonstrate the usefulness of alternative filtering methods for forecasting house prices.
Design/methodology/approach
We specifically focus on exponential smoothing with trend adjustment and multiplicative decomposition using median house prices for Sydney from Q3 1994 to Q1 2017. The model performance is evaluated using out-of-sample forecasting techniques and a robustness check against secondary data sources.
Findings
Multiplicative decomposition outperforms exponential smoothing at forecasting accuracy. The superior decomposition model suggests that seasonal and cyclical components provide important additional information for predicting house prices. The forecasts for 2017–2028 suggest that prices will slowly increase, going past 2016 levels by 2020 in the apartment market and by 2022/2023 in the detached housing market.
Research limitations/implications
We demonstrate that filtering models are simple (univariate models that only require historical house prices), easy to implement (with no condition of stationarity) and widely used in financial trading, sports betting and other fields where producing accurate forecasts is more important than explaining the drivers of change. The paper puts forward a case for the inclusion of filtering models within the forecasting toolkit as a useful reference point for comparing forecasts from alternative models.
Originality/value
To the best of the authors’ knowledge, this paper undertakes the first systematic comparison of two filtering models for the Sydney housing market.
Details
Keywords
Huong Ha, Man Chung Wong and Hui Shan Loh
This study examines whether corporate social responsibility (CSR) initiatives positively impact customers’ selection of retail banks in Hong Kong (HK) and identifies which CSR…
Abstract
Purpose
This study examines whether corporate social responsibility (CSR) initiatives positively impact customers’ selection of retail banks in Hong Kong (HK) and identifies which CSR domains affect customers’ selection of banks.
Design/methodology/approach
This study adopted a quantitative approach. Primary data were collected from 416 customers of 22 retail banks in HK. The theoretical framework of this study was developed from a literature review, prior studies by Oberseder et al. (2013 and 2014), and CSR initiatives implemented by leading retail banks in HK. Descriptive statistics and statistical tests were used to analyze the data.
Findings
The study found that CSR initiatives positively affect customers’ bank selection. CSR initiatives related to the customer and environment domains are likely to have a greater impact on customers than those related to the society domain and are not likely to significantly impact customers’ bank selection.
Originality/value
This study contributes to the CSR literature by offering enhanced insight into the dynamics of CSR and its effects on customer bank selection. Furthermore, this study tests consumers’ perceptions of CSR initiatives in each CSR domain in the banking sector in Hong Kong – a novel approach that has not been previously explored in existing studies. These findings can help banks review the effectiveness of their CSR initiatives and make informed decisions on which initiatives should pursue improved CSR performance and efficient resource allocation.
Details
Keywords
Ray Sastri, Fanglin Li, Hafiz Muhammad Naveed and Arbi Setiyawan
The COVID-19 pandemic severely impacted tourism, and the hotel and restaurant industry was the most affected sector, which faced issues related to business uncertainty and…
Abstract
Purpose
The COVID-19 pandemic severely impacted tourism, and the hotel and restaurant industry was the most affected sector, which faced issues related to business uncertainty and unemployment during the crisis. The analysis of recovery time and the influence factors is significant to support policymakers in developing an effective response and mitigating the risks associated with the tourism crisis. This study aims to investigate numerous factors affecting the recovery time of the hotel and restaurant sector after the COVID-19 crisis by using survival analysis.
Design/methodology/approach
This study uses the quarterly value added with the observation time from quarter 1 in 2020 to quarter 1 in 2023 to measure the recovery status. The recovery time refers to the number of quarters needed for the hotel and restaurant sector to get value added equal to or exceed the value added before the crisis. This study applies survival models, including lognormal regression, Weibull regression, and Cox regression, to investigate the effect of numerous factors on the hazard ratio of recovery time of hotels and restaurants after the COVID-19 crisis. This model accommodates all cases, including “recovered” and “not recovered yet” areas.
Findings
The empirical findings represented that the Cox regression model stratified by the area type fit the data well. The priority tourism areas had a longer recovery time than the non-priority areas, but they had a higher probability of recovery from a crisis of the same magnitude. The size of the regional gross domestic product, decentralization funds, multiplier effect, recovery time of transportation, and recovery time of the service sector had a significant impact on the probability of recovery.
Originality/value
This study contributes to the literature by examining the recovery time of the hotel and restaurant sector across Indonesian provinces after the COVID-19 crisis. Employing survival analysis, this study identifies the pivotal factors affecting the probability of recovery. Moreover, this study stands as a pioneer in investigating the multiplier effect of the regional tourism and its impact on the speed of recovery.
Details
Keywords
Ari Budi Kristanto and June Cao
This systematic literature review presents the evolution of accounting-related research in the Indonesian context. We examine 55 academic articles from the initial 296 records of…
Abstract
Purpose
This systematic literature review presents the evolution of accounting-related research in the Indonesian context. We examine 55 academic articles from the initial 296 records of accounting and finance research in the Q1 Scopus-indexed journals from 1995 to 2022. This study sheds light on Indonesia’s main research streams, unique settings and urgent future research agenda.
Design/methodology/approach
This study adopts a systematic approach for a comprehensive literature review. We select articles according to a series of criteria and compile the metadata for the bibliographic mapping.
Findings
Our bibliometric analysis suggests five main research streams, namely (1) political connection, (2) capital market, (3) audit and accountability, (4) firm policy and (5) banking. We identify the following distinctive country settings, which are well discussed in extant literature: political connection, two-tier board system, weak accounting profession, information opacity and cultural impact on accounting. We outline prospective agendas to examine the institutional mechanisms’ role in addressing major environmental challenges through accountability.
Originality/value
This study offers unique contributions to the literature by comprehensively reviewing accounting-related research in Indonesia. Despite Indonesia’s economic and environmental importance, it has received limited attention from scholars. Using dynamic topic analysis, we highlight the need to examine the role of informal institutions, such as political connections and culture and formal institutional mechanisms, such as corporate governance and environmental disclosure.
Details
Keywords
In this article, the outcomes of a survey aimed to investigate how aware of and how capable coaches in higher vocational Dutch education perceive themselves to assist students…
Abstract
Purpose
In this article, the outcomes of a survey aimed to investigate how aware of and how capable coaches in higher vocational Dutch education perceive themselves to assist students displaying mental health and well-being issues are presented. Additionally, the article explores coaches’ perceptions regarding the frequency, form of help offered, topics to be tackled and the preferred form in which this help should be provided.
Design/methodology/approach
The author conducted a survey that gathered qualitative and quantitative data from coaches (N = 82) at a Dutch University of Applied Sciences in the north of the Netherlands. A differentiation in coaches’ number of years of teaching and coaching experience was considered.
Findings
The outcomes of the data analyses showed that overall, coaches claimed to be very aware of students’ mental health and well-being-related issues and that female coaches tend to be more aware of these than male coaches. The group of coaches with 5–25 years of coaching experience resulted in being less trained to notice when students struggle with mental health and well-being issues. Overall, coaches indicated to be tentatively willing to assist such students and reported to have a rather low ability and capability to assist students who displayed mental health and well-being issues. More than half of the respondents declared that “face to-face” was the most appropriate approach to address mental health and well-being topics, and most of the respondents (43%) answered that it should be “offered at student’s request.” Some suggested topics to be offered were stress, depression, anxiety, study-related issues, study motivation, persistence, emotional intelligence and emotional resilience. Coaches proposed to be provided with trainings that equip them with the necessary knowledge, tools, and concrete mental health and well-being topics that could be addressed during coaching. Additionally, there should be a clear distinction between professional mental health help and coaching for mental health and well-being in universities.
Research limitations/implications
There were very few studies that reported on coaching for mental health and well-being in higher education after the Covid-19 pandemic in the Netherlands to compare the results with; the sample size of this survey was small; the survey was designed to capture only the coaches’ perceptions on students’ mental health-related issues.
Practical implications
By performing this survey, more empirical knowledge is added regarding higher education coaches’ perception of their awareness, willingness, capability and ability to assist students who display mental health and well-being issues in general, and students affected by the impact of the Covid-19 pandemic in particular. Furthermore, insights regarding higher education coaches’ perception on the frequency, form of the help offered, topics to be tackled and form in which this help to be offered were gathered.
Originality/value
By performing this survey, more empirical knowledge is added regarding higher education coaches’ perception of their awareness, willingness, capability and ability to assist students who display mental health and well-being issues in general, and students affected by the impact of the Covid-19 pandemic in particular. Furthermore, insights regarding higher education coaches’ perception of the frequency, form of the help offered, topics to be tackled and the preferred form in which this help should be offered were gathered.
Details