Bank management and strategic planning for the 1980s

This paper examines a number of important issues facing banking in the 1980s. The authors maintain that banking has been managing primarily by crisis, and this 'simply cannot be the operating norm'. The paper analyses a number of selected issues facing bank management in 1978 and the perceptions of bank managers about those issues vs their probable importance in 1985; furthermore, the paper examines likely operating strategies which will be required as effective responses to emerging environmental realities. Through examining the competitive realities for 1985 this paper, as have many others recently, broadens the context within which planning in banking will perhaps take place in the future.     

Scale versus specialization: banking strategies after the euro

The euro will transform the competitive landscape of European banking. This paper discusses some of the strategic effects of the euro on banks. In particular, it explores two questions: the rationale behind mergers and acquisitions and the universal banking model. The strategic analysis of the forces for change in banking leads to some conclusions: scale will not be the key success factor in European banking, the euro will increase the role of financial specialists in Europe and the universal banking model will face numerous challenges in the new context.     

Aligning operations,marketing, and competitive strategies to enhance performance: An empirical test in the retail banking industry

The close linkage between competitive strategy and functional strategic activities is asserted to be a precondition to the achievement of optimal business performance. This study explores how the relationship between (and among) operations, marketing, and competitive strategies affects organizational performance in the banking industry. Our findings show that: (a) competitive strategy moderates the relationship between operations and marketing strategic activities, and organizational performance, (b) certain integrated strategic decisions of operations and marketing functions have a significant impact on organizational performance, and (c) the performance of retail banks within a strategic group differs depending on the quality of the strategic fit.     

Do performance and environmental conditions act as barriers for cross-border banking in Europe?

This paper attempts to analyse whether banking technology and environmental conditions act as barriers for the entry of foreign banks in each European banking industry. We evaluate how the efficiency score of a representative commercial bank of a given European country changes if it decides to move abroad. To carry out this analysis, we use a sample of 700 banks belonging to 11 European countries. Countries are paired and each couple is studied by using four DEA production frontiers. These frontiers allow us to measure the technological and environmental gaps between the two countries considered and, based on them, to predict the new efficiency score of the representative bank of a country that decides to operate in a different country. The results indicate, as expected, that being technologically advanced appears to be a significant deterrent to foreign competition, and that adverse environmental conditions constitute a real barrier for cross-border banking activity. Additionally, the results suggest that host-nation banking performance is a good safeguard against cross-border competition.     

顾客采用网络银行的影响因素研究

网络银行已经成为银行业保留老顾客和获取新顾客的一种新兴的服务渠道,而有关顾客采用网络银行影响因素的研究也越来越激发兴趣,引起关注。感知风险和信任是网络银行顾客最为担心的因素,但这似乎并没有引起学者们的足够重视。大多数研究都将顾客方面的建构作为认知建构的前置因素,而将银行方面的建构作为认知建构的前置因素的研究还几乎无人问津。本研究的重要意义在于:在具体的网络银行环境下,以科技接受模型为基础,在认知建构中增加感知风险和信任等变量,同时将顾客方面的自我效能和银行方面的便利条件两个建构分别作为认知构建的前置因素,从而对网络银行的采用意图进行理论探讨和实证检验。     

Branch banking in the year 2000

The topic of branch banking in the United States in the year 2000 is obviously one that has been in the minds of California bankers for some time because California is the largest state in the United States to permit virtually unlimited statewide branch banking. It is a topic that must also be in the minds of a large number of European and Asian bankers as well because several non-U.S. banking systems have already established large branch networks in the United States. It is a difficult topic because no one knows precisely what will be the status of branch banking in the year 1990, let alone the year 2000. This article makes some predictions.     

Total factor productivity and shareholder returns in banking

This paper examines shareholder value drivers in European banking focusing on the efficiency and productivity features of individual banks. In particular, we analyse the value relevance of bank cost efficiency and total factor productivity (TFP) (in all its components, including technological change, pure technical efficiency change and scale efficiency change) to see how these influence shareholder value creation in European banking. The paper focuses on the French, German, Italian and U.K. banking systems over the period 1995–2002 and includes both listed and non-listed banks. We find that TFP changes best explain variations in shareholder value (measured by market-adjusted returns, MAR, for listed banks and by the ratio of EVA_bkg to invested capital at time t−1 for non-listed banks). In both samples, we also find that technological change seems to be the most important component of TFP influencing shareholder value creation in European banking.     

A multivariate analysis of the financial characteristics of foreign and domestic banks in the UK

For the banking sector in the EU, the UK is one of the most important countries, since over a quarter of all banking assets in the EU are held in the UK and it is the largest single international banking centre, accounting for 20% of the world's cross-border lending. The UK banking sector has traditionally been one of the most open and it is characterized by a rapidly increasing foreign bank presence. Foreign banks account for 55% of the total assets of the UK banking sector. The objective of this paper is to investigate the performance of the banking sector in the UK focusing on the performance of the domestic banks as opposed to the performance of the foreign banks operating in the UK. For this purpose, a multivariate analysis is performed to identify the existing differences between the financial characteristics of domestic and foreign banks, considering profitability, liquidity, risk and efficiency factors. The data sample covers 26 domestic and 32 foreign banks operating in the UK over the period 1998–2001.     

Hybridizing logistic regression with product unit and RBF networks for accurate detection and prediction of banking crises

As the current crisis has painfully proved, the financial system plays a crucial role in economic development. Although the current crisis is being of an exceptional magnitude, financial crises are recurrent phenomena in modern financial systems. The literature offers several definitions of financial instability, but for our purposes we identity financial crisis with banking crisis as the most common example of financial instability. In this paper we introduce a novel model for detection and prediction of crises, based on the hybridization of a standard logistic regression with product unit (PU) neural networks and radial basis function (RBF) networks. These hybrid approaches are fully described in the paper, and applied to the detection and prediction of banking crises by using a large database of countries in the period 1981–1999. The proposed techniques are shown to perform better than other existing statistical and artificial intelligence methods in this problem.     

基于核心-边缘网络的中国银行风险传染

采用核心-边缘网络刻画我国银行间市场的网络结构,结合各银行同业往来资产和负债信息构建风险传染模型,对单个银行倒闭以及资产价格泡沫破灭两种情况下的传染过程进行模拟.研究发现,近年来我国银行系统的抗风险能力不断增强,但在所有银行中中国银行的风险传染程度最严重,应该加强对系统重要性银行的重视.同时,防范银行危机的关键在于控制资产价格泡沫,在合理的资产价格水平下,外界冲击难以对银行系统的安全性构成威胁.     

Competitive and Cooperative Positioning in Supply Chain Logistics Relationships*

Cooperative logistics relationships require the sharing of information, which must be enabled by the integration of disparate information systems across partners. In this article, we theorize business‐to‐business logistics relationships should be managed using cooperative and competitive postures. Based on data from 91 dyadic relationships using interorganizational information technology (IT), we find that performance gains accrue when parties share strategic information and customize IT; mutual trust enables IT customization and strategic‐information flows and equitable relationship‐specific investments positively impact IT customization, mutual trust, and performance. Among other scholarly and practical implications discussed, partners should compete on resources for IT customization and cooperate to share strategic information. Managers tend to think of relationships with firms as polar opposites and view them as entirely cooperative or entirely competitive. Our results support active balancing and understanding of both competitive and cooperative stances. Such an approach enables conditions for participation symmetry that yields greater performance gains.     

双渠道风险传染下银行系统稳定性分析

随着金融危机的频率和范围的不断扩大,银行系统性风险的研究越来越受到重视。针对银行业系统性风险,构建银行同业拆借（直接传染渠道）、银行共同持有资产（间接传染渠道）的双渠道风险传染网络模型。该模型引入了宏观经济波动带来的投资风险,并允许银行通过贬值出售资产来弥补流动性,这更真实地反映了银行系统的操作规则。研究结果表明,在各种经济因素波动情况下,平均储蓄量、储蓄的波动幅度、投资的收益率、存款准备金率以及储蓄利率等对银行系统稳定性的有较大影响,并进行了定量分析。该研究为定量研究宏观经济波动下银行系统性风险问题提供了方案,并为决策者和监管部门防范银行系统性风险提供了参考。     

Developing strategies for management information systems

This is the first of two articles on a practical approach to Business Information Systems Planning. The articles will outline a formal but practical approach for the development of an information systems strategy. The approach is based on experience gained by the author in the conduct of planning projects in a variety of industries, including wholesale and retail banking, consumer credit, chemicals, multinational manufacturing and distribution and the oil industry. The articles are based on the author's book ‘Planning for Business Information Systems’ (Pergamon Books, 1986).     

How do Greek banking institutions react after significant events?—A DEA approach

The efficiency of Greek commercial banks is considered through the period 1995–2003 using the data envelopment analysis technique. Two approaches are used to measure efficiency: one using financial ratios as outputs only and the other viewing banks as credit generation and transaction institutions. The empirical results are used to examine the reaction of banking institutions after significant events such as M&As, privatizations and the crisis of the Athens Stock Exchange in 1999. In most cases performance deteriorates for the next 1 to 2 years, while increases thereafter, forming specific patterns of efficiency. In the last part we introduce an index to measure the management's efficiency through a process of change. The results suggest that the Greek banking sector operated efficiently on average during the destabilization periods. The contribution of the article is that it comprises the first study which examines empirically the performance behavior of banking institutions within the scope of change management theory.     

Who performs a stronger response to whom? Detecting individual competitive actions and reactions

This study analyzes the degree of competition through individual actions and reactions. Empirical support for this analysis has derived mainly from structural econometric models describing the nature of competition. This analysis extends the existing literature by empirically considering a direct measurement of competition through the analysis of the competitive actions and responses, and describing how firms compete within and between strategic groups. We estimate the firms’ conduct in the Spanish deposits market with 146 firms and 18,888 observations. This is a specially compelling context for the banking industry, in which a deregulation process gives rise to the adoption of aggressive strategies seeking to increase the market shares of deposit accounts; thus, producing a turbulent situation of increasing rivalry. Our results offer a deeper understanding of the firms’ competitive behavior, since we identify different patterns of actions and reactions depending upon the strategic group the firm belongs to.     

FINANCIAL DEPENDENCE,BANKING SECTOR COMPETITION,AND ECONOMIC GROWTH

The relationships among competition in the financial sector, access of firms to external financing, and associated economic growth are ambiguous in theory. Moreover, measuring competition in the financial sector can be complex. In this paper we first estimate for 16 countries an industrial organization‐based measure of banking system competition. We then relate this competition measure to growth of industries and find that greater competition in countries' banking systems allows financially dependent industries to grow faster. These results are robust under a variety of tests. Our results suggest that the degree of competition is an important aspect of financial sector functioning. (JEL: D4, G21, L11, L80, O16)     

Efficiency improvement from multiple perspectives: An application to Japanese banking industry

The current study focuses on efficiency improvement for banking systems from multiple perspectives, which have different definitions of input/output about various attributes of a banking system. In this research we utilize data envelopment analysis (DEA) and Nash bargaining game (NBG) theory to improve inefficient banks in order to: (1) Make the inefficient bank be the state of Pareto Optimality for multiple perspectives, which can avoid discontentment of some perspectives. (2) Improve a bank by changing its attributes and provide various improving schemes for decision makers. A numerical case study of Japanese banks is also given to show the results of equilibrium solution from multiple perspectives.     

Technical Innovation and Competitive Advantage in Retail Financial Services: A Case Study of Change and Industry Response

This article presents a case study of a major technical innovation in the core activity of payment processing in a UK bank. In describing the strategic rationale for the change and the process of implementation, the degree of consistency between the operational and organizational dimensions of the new system are examined. As this system is widely regarded as the benchmark for future paper processing in the industry, the factors contributing to successful innovation are discussed and the management rather than the technological aspects of this are emphasized. Competitor responses to the innovation are explained by the influence of traditional assumptions about the basis of competitive advantage in banking.     

Strategic management of consumer services

A period of more rigorous strategic management is under way in consumer service businesses. In banking, insurance, lodging, media, retailing, housing, restaurants and education, more growth must come from competitive share shift. This paper b shows the need for a different set of strategies to win in services than have been shaped in the product business context. Specific illustrations show how leading U.S. consumer service companies are building strategic advantage while also improving the value of their business.     

Efficiency measures of the Chinese commercial banking system using an additive two-stage DEA

Measuring and improving the efficiency of the Chinese commercial banking system has recently attracted increasing interest. Few studies, however, have adopted the two-stage network DEA to explore this issue in the Chinese context. Because the entire operational process of the banking system could be divided into two sub-processes (deposit producing and profit earning), the evaluation of the sub-process efficiencies could be used to assist in identifying the sources of the inefficiency of the entire banking system. In this study, we utilize the network DEA approach to disaggregate, evaluate and test the efficiencies of 16 major Chinese commercial banks during the third round of the Chinese banking reform period (2003–2011) with the variable returns to scale setting and the consideration of undesirable/bad output. The main findings of this study are as follows: (i) the two-stage DEA model is more effective than the conventional black box DEA model in identifying the inefficiency of banking system, and the inefficiency of the Chinese banking system primarily results from the inefficiency of its deposit producing sub-process; (ii) the overall efficiency of the Chinese banking system improves over the study period because of the reform; (iii) the state-owned commercial banks (SOBs) appear to be more overall efficient than the joint-stock commercial banks (JSBs) only in the pre-reform period, and the efficiency difference between the SOBs and the JSBs is reduced over the post-reform period; (iv) the disposal of non-performing loans (NPLs) from the Chinese banking system in general explains its efficiency improvement, and the joint-equity reform of the SOBs specifically increases their efficiencies.