...THE GROWTH OF AGENCY BANKING IN KENYA BY JOEL WANJOHI D63/73163/2012 A RESEARCH PROPOSAL SUBMITTED AS ASSIGNMENT FOR DFI 513: MASTER OF SCIENCE IN FINANCE, UNIVERSITY OF NAIROBI NOVEMBER 2012 DECLARATION I hereby declare that this proposal is entirely my own composition. It has not been presented in any University or college for examination purposes. All references made to works of other persons have been duly acknowledged. Permission from the author or examining body should be sought before any part of this work is reproduced. Signed: __________________ …………………………………. Reg. No. D63/73163/2012 Date: 25/11/2012 ABSTRACT Agency banking is a new banking concept introduced in Kenya by the Central Bank (CBK). The main objective is to increase financial services outreach and to promote financial inclusion to the un-banked and under-banked population without risking the safety and soundness of the banking system. The concept is also geared towards encouraging financial institutions to use agents in the provision of banking services so as to reduce the cost of financial services and to foster financial inclusion, reach and depth. Commercial Banks worldwide offer similar kinds of services, but they could provide differences in terms of service quality. This paper analyzes past studies regarding service quality improvement in the agency banking sector. The continuing trend to a model of service quality improvement, from personnel...
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...evaluation methods in commercial banks and associated risks for managing assets and liabilities 97 Performance evaluation methods in commercial banks and associated risks for managing assets and liabilities University Reader PhD. Claudiu CICEA, Academy of Economic Studies Bucharest, Romania email : claudiu.cicea@man.ase.ro University Professor PhD. Daniela HINCU, Academy of Economic Studies Bucharest, Romania email : daniela.hincu@man.ase.ro Abstract Commercial banks represent the core of the credit for any national economy. In turn, the credit is the engine that put in motion the financial flows that determine growth and economic development of a nation. As a result, any efficiency in the activities of commercial banks has special implications on the entire economy. That is why we consider very useful to present an analysis of possibilities for evaluating the performance in the commercial banks. The management of every commercial bank must establish a system for assessing investment performance which suits its circumstances and needs and this evaluation must be done at consecutive intervals to ensure the achievement of the Bank's investment objectives of hand; and to know the general direction of the behavior of investment activity in the past and therefore predictable as it in the future on the other hand. The main objective for this paper is to analyze some quantitative methods used in assessing the performance of investment activity in commercial banks (such quantitative...
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...Chinese Commercial Banks' Capital Structure Optimization Jianwen ZHENG Wuhan University of Technology,China email:174068598@qq.com Keywords: Commercial Banking, Capital Structure, Optimization, Strategy Abstract. Optimize the capital structure is the fact that the premise of improving corporate governance.This paper describes the status of the capital structure of Chinese commercial banks, analyzes the main problems of Chinese commercial banks supplement existing capital structure, optimization strategies proposed capital structure of commercial banks in China, China's policy of commercial banks and other wealthy significant ownership concentration, such as optimization of innovative recommendations. Introduction The capital structure of the model can have a significant impact on the Company's operating performance.This effect can be divided into two cases: one is the direct impact that the capital structure, the financing risk and the cost of capital can directly affect business performance; while another case is the indirect impact, mainly on the company's first impact on the governance structure, and then have an impact on business performance through the governance structure.The pace of development of China's listed banks initially very slow. Under conditions of economic system reform, the bank's capital structure gradual adjustments, operating performance has gradually improved. However, compared with the world's developed countries, Chinese commercial banks...
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...Major Problems of the Banking Industry and Strategies to overcome them: A study on Bangladesh. Table of Content Topic Page# 1.0 Introduction ------------------------------------------------------------------------------------3 2.0 Review of Previous Empirical Literature------------------------------------------------4 3.0 Banking Industry in Bangladesh---------------------------------------------------------- 3.1 What is a Bank? ----------------------------------------------------------------------5 3.2 Definitions of Bank form different view -------------------------------------5 3.3 Where does the word BANK come from? ------------------------------------6 3.4 Why Banks? Why don’t go to another financial institution? -------------7 3.5 Banking System in Bangladesh---------------------------------------------------7 3.6 Banking system is very from country to country because of Following 3 reasons---------------------------------------------------------------------12 3.7 There are different kinds of financial services firms calling themselves Banks---------------------------------------------------------------------------------------12 4.0 Major Problems Faced by Bangladeshi Banking Industry-------------------------14 4.1 Lack of Good Governance, Accountability and Transparency------------14 4.2 Low quality of asset ---------...
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... Morgan is a leader in asset management, investment banking, private banking, treasury and securities services, and commercial banking. | |Today, the firm serves one of the largest client franchises in the world, including corporations, institutional investors, hedge funds, | |governments, healthcare organizations, educational institutions and affluent individuals in more than 100 countries. | | | |J.P. Morgan’s core businesses include: | |Asset Management | |Investment Bank | |Private Banking | |Securities Services | |Treasury Services | |Commercial Banking ...
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... ii ACKNOWLEDGEMENT I wish to thank the almighty God who has sustained me throughout this project I would also wish to thank my supervisor Mr. Geoffrey Kinyua for his valuable patience and assistance in accomplishing this project I would also wish to thank the technical staff of K.C B jogoo road branch for their help and cooperation iii ABSTRACT With reference to K.C.B this research is carried out to investigate the challenges facing the banking industry in Kenya. The specific objectives are; to investigate whether theft cases in banks are a major problem, to establish if ATM card skimming is a problem to the banking industry in Kenya, to determine if high interest rates are affecting the banking industry in Kenya negatively, to find out if mobile money transfer services are becoming a competition to banks in Kenya. The sample design was stratified random sampling so as to obtain data...
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...IB, UPES DEHRADUN ABSTRACT Talking about the Today Scenario, Financial Institutions are focusing on the improving system for Finance in Rural Areas. As on the day when Narendra Modi's Government came on the rule, it has already focused on increasing the number of branches of Commercial Banks in rural areas in order to provide better financial services to the people residing in such areas. Moreover the interest rate of financing in rural areas should be kept low as in comparison to that financing in urban areas and moreover the time period should be increased. As we can see that previously Agriculture was one of the main sources of income of people but now the fact has changed. As people are migrating to urban areas in search of jobs where they could get more amount of money in order to fulfill their basic necessities. This is because we can consider due to changing weather conditions in India as production level has gone down due to less rain. Thus in order to encourage growing of agricultural products, the Government should take initiative in increasing the finance in order to cope up these different situations that the country is facing. Now the State Government of Uttar Pradesh has taken the initiative. As this year due to heavy rains in most parts of Uttar Pradesh, the crops were destroyed and moreover the farmers were at loss and thus even resulted in increasing number of suicides in the states by farmer. Thus in order to overcome...
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...Chinese Banking System- Risk Management Central banks are the principal monetary authority of a country or a group of countries and are crucial to the functioning of all banks, financial markets, and the economy. “Central banks typically expose themselves to variety of risks including market, credit, interest rate and liquidity risk”. (PWC.com). Furthermore, central banks are exposed to significant reputational and operational risks as well as legal risks. Central banks necessitate the combination ofliquidity, safety and the enhancement of returns on invested funds, as the fundamental criteria for managing its reserves and financial risks. Hence, central banks usually implement a separate risk management department that monitors the central bank widerisks. In the Chinese banking system, China Bank Regulatory Commission (CBRC) is responsible for overseeing risk management of all the Chinese banks. The CBRC requires banks to take operative measures to address the weaknesses in their internal controls and improve their risk management and internal control practices.Due to the complicated and changing economic and market environments, both internationally and domestically, along with the emerging risks on various fronts, the CBRC strives to take responsive actions to facilitate sound and sustainable economic and financial developments in China. It endeavors to identify andmitigate risks in a forward-looking manner, by constantly improving the regulatory framework and supervisory...
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...Introduction A liquidity crisis may be created in the banking sector due to its over-reliance on domestic borrowing for implementing the annual development programme. If the government borrows hugely for implementing the ADP, the industrial sector will not get enough loans from the banking system, which will ultimately lead to a higher bank interest rate. The government is planning to borrow from banks of Tk 18,957 crore for meeting the deficit and spending in different sectors. The growth of the industrial sector will be hampered if the government does not stop borrowing from banks. Due to government borrowing banking sector is facing a great amount of liquidity crisis in the recent years. Liquidity crisis results in various problems to the economy. it rises interest rate, hinders economic growth, decreases confidence of banking people. So, it is one of the major responsibilities of the Bangladesh Bank to make proper steps to control liquidity crisis. What is liquidity? Liquidity refers to how quickly and cheaply an asset can be converted into cash. Money in the form of cash is the most liquid asset. Assets that generally can only be sold after a long exhaustive search for a buyer are known as illiquid. High liquidity means there is a lot of capital because interest rates are low, and so capital is easily available. Interest rates are very important in controlling liquidity. What Does Liquidity Crisis Mean? Liquidity crisis indicates a negative financial situation characterized...
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...formed after the merger of two previously formed major banking institutions; Chase Manhattan Corporation and J.P Morgan & Co (J.P Morgan Chase & Co, 2014). It was ranked by Forbes magazine as the fourth largest public company in the world. (Murphy, 2014) In addition to this as of 2011 the hedge fund unit , which refers to a rather complex investment type, is the second largest hedge fund in the US only being out won by Bridgewater Associates. (Unknown , 2010).Commercial and consumer banking in the U.S operates under the Chase Banking Brand while JP Morgan services global corporations, institutional investors, wealthy individuals and governments throughout the world. II. Historical perspective on the organization Founded in 1799 by its predecessors in New York City, JP Morgan Chase is one of the oldest and largest financial institution in the world (JP Morgan Chase & Co, 2014). Over 1,000 companies combined throughout the years in order to form JPMorgan Chase & Co. Major firms includes J.P. Morgan, Chase Manhattan, Chemical, Manufacturers Hanover and Bank One, First Chicago, and National Bank of Detroit. The company have had many essential mergers throughout its history but one of the most significant occurred in 1991 when Manufacturers Hanover Corp and Chemical Banking Corp. merged in-order to form the second largest U.S banking institution at that time, Chemical Banking Corp. In 1995 the largest banking...
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...Banking have unique role in the economy. According to Corrigan (1982) they are special because: (1) they provide transaction services and regulate payments system; (2) banks offer backup liquidity to the economy; and (3) they are broadcaster of monetary policy. Due to importance of banking, there are number of theoretical approaches in evaluation of banking system. This could be difficult as operational scale of banks is distinctive. Banks serve role of medium exchange function of money, add value for storage of money. Moreover, banks have different leverage levels in comparison with other industries. For example, 0.5-0.6 is a usual debt-equity ratio for conservative commercial firm. However, banks could have debt equity ratio of 9 in some cases. There are four main approaches to the study of banking, which are * Analysis of a bank as a financial institution and its role in economic development. * Financial management approach. * A monetary economics approach (relationship between central bank and commercial banks). * Industrial Organisation Approach. First three approaches do not reveal in depth the aspect of completion and structure in banking industry. Industrial Organisation Approach takes whole banking system as one industry and studies it. I.O. Approach treats banks as ordinary firms. However, takes into account: risk level, level of monitoring and level of investment, so wider set of variables is taken into account in comparison with standard firms...
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...with different outcomes, risk and how to manage it has become a critical issue. The recent global financial crisis served as a reminder that risk management and how the same is practiced is fundamental if performance objectives are to be consistentlyachieved. It has emerged that as business owners and managers strive to improve and sustain performance they are now also required to consider what risk management practices their organizations have adopted to avoid falling short of their strategic objectives. This is even more so in the financial services sector which was the most affected during the recent financial crisis. The objectives of this study were to analyze the risk management practices undertaken by Commercial Banks in Kenya and to determine and assess the effect of these risk management practices on their financial performance. The risks facing financial institutions are mainly classified into; strategic, operational, credit and market risks. In managing these risks, the risk management approach adopted by the owners and/or management was influenced by the organizational culture and support, whether or not risk management is integrated in the setting of organizational objectives, whether there is a documented risk management policy or framework, how the risk identification process is conducted, the risk analysis process, evaluation and treatment of risk; risk monitoring and review; and last but not least ensuring that there is effective risk management. In order to carry...
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...Institutions and Banking Anjul Katyal Registration No: 20109 Lecturer: Juliane Thamm Date: 22nd November 2010 Abstract This paper shows the existence of deposit insurance in today’s complex economic situation. Deposit insurance schemes are present in most of the countries and are well-established in all developed economies.1 Deposit insurance takes the form of a guarantee to depositors that they will be compensated after the most unlikely event of bank failure. Bank run is not a single model it evolves many other complications whether it is for its depositors, government or for the whole economy. To reduce the all over effect of financial problem, schemes like deposit insurance were in discussion by the regulatory authorities. Although deposit insurance present both positive and negative aspects for the economy. Introduction Banks are the most important financial institutions in every country as they act as an intermediary between lenders and borrower. General public use banks as safest place to keep their savings which can be used in the needed situation and also to earn some interest on their deposits. Banking institutions invest that money in other projects to gain profit, but some time when financial instruments fails in the economy then banks and depositors are backed by the schemes like deposit insurance. In the past decades, a series of banking disaster has shaken the world’s economy. Many of the banks have gone bankrupt and some are facing liquidity problems...
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...| NDIANG’UI DOROTHY WAIRIMU | THE RELATIONSHIP BETWEEN DIVIDEND GROWTH AND RISK FOR COMPANIES LISTED AT THE NSE | MURIITHI ERIC | THE RELATIONSHIP BETWEEN CORPORATE GOVERNANCE PRACTICES AND FINANCIAL AND FINANCIAL PERFORMANCE OF INVESTMENT BANKS IN KENYA | NICHOLAS KIPYEGOMEN CHEPKOIWO | FACTORS AFFECTING THE DEVELOPMENT OF EMERGING CAPITAL MARKETS. THE CASE OF NAIROBI STOCK EXCHANGE | KIPKURUI KIMOSOP | THE RELATIONSHIP BETWEEN CORPORATE GOVERNANCE AND FINANCIAL PERFORMANCE OF INSURANCE COMPANIES IN KENYA | OMENDA CHRISTOPHER ODHIAMBO | EFFECT OF STOCK SPLITS ON STOCK LIQUIDITY OF COMPANIES QUOTED AT THE NSE | GEORGE MARTIN NZIVE KASYOKA | THE USE OF STRATEGIC POSITIONING TO ACHIEVE SUSTAINABLE COMPETITIVE ADVANTAGE AT SAFARICOM LIMITED | MUTIE PETER KIOKO | RELATIONSHIP BETWEEN PRIOR PERIOD DIVIDENDS AND FINANCIAL PERFORMANCE OF FIRMS LISTED AT THE NSE | EVANS ODHIAMBO OYIEYO | BALANCE SCORE CARD AS A STRATEGIC MANUFACTURING INDUSTRY IN KENYA | SAMBA STEPHEN MIDEGA | INVESTIGATION OF CAPACITY MANAGEMENT STRATEGIES AND THEIR INFLUENCE ON SERVICE QUALITY: CASE OF NAIROBI SUPERMARKETS. | LUCY MUTHEU KIILU | CAUSES OF INDUSTRIAL DISPUTE IN GARMENT FACTORIES AT THE ATHI RIVER EXPORT PROCESSING ZONES, KENYA | JENIFFER N. MULI | THE RELATIONSHIP BETWEEN HOUSE PRICES AND MORTGAGE CREDIT IN KENYA | LOISE KINYUA WANJIRU | STRATEGIC RESPONSES OF EQUITY BANK TO FRAUD RELATED RISKS | DOMSIANA ANYANGO ONYANGO | THE RELATIONSHIP BETWEEN FINANCIAL PERFORMANCE...
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...Institutions Center Commercial Bank Risk Management: An Analysis of the Process by Anthony M. Santomero 95-11-B THE WHARTON FINANCIAL INSTITUTIONS CENTER The Wharton Financial Institutions Center provides a multi-disciplinary research approach to the problems and opportunities facing the financial services industry in its search for competitive excellence. The Center's research focuses on the issues related to managing risk at the firm level as well as ways to improve productivity and performance. The Center fosters the development of a community of faculty, visiting scholars and Ph.D. candidates whose research interests complement and support the mission of the Center. The Center works closely with industry executives and practitioners to ensure that its research is informed by the operating realities and competitive demands facing industry participants as they pursue competitive excellence. Copies of the working papers summarized here are available from the Center. If you would like to learn more about the Center or become a member of our research community, please let us know of your interest. Anthony M. Santomero Director The Working Paper Series is made possible by a generous grant from the Alfred P. Sloan Foundation Commercial Bank Risk Management: An Analysis of the Process Anthony M. Santomero Richard K. Mellon Professor of Finance The Wharton School October 8, 1996 I. Introduction The past decade has seen dramatic losses in the banking industry. Firms...
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