Liquidity and Borrowing from a Lender of Last Resort during the Crisis of 1884

This paper investigates the relation between bank liquidity and borrowing from a lender of last resort on a high frequency basis during a financial crisis.  The paper evaluates weekly observations of individual bank borrowing of clearinghouse loan certificates by a panel of New York Clearing House member banks during the crisis of 1884.  Naturally, banks with higher reserve ratios borrowed lower amounts, but banks replaced a dollar of reserves with less than a dollar of borrowing from a lender of last resort

Performance Evaluation of State-Owned Company Stocks in Indonesia: A Portfolio Formation Approach

This study delves into the performance of Indonesian state-owned enterprises (BUMN) stocks from February 2021 to October 2023, attracting investor attention due to their strategic position in the national economy. However, the stock performance during this period exhibited suboptimal movements, failing to surpass the returns of the Indonesia Stock Exchange Composite Index (IHSG). To address this, a prudent investment strategy is essential, encompassing portfolio construction and management. In portfolio construction, the study employs proven smart beta strategies, known for delivering superior returns compared to traditional portfolios. Portfolio management involves testing two strategies: a passive approach utilizing the buy-and-hold technique and an active approach employing portfolio recomposition. This quantitative descriptive study utilizes historical closing price data, forming portfolios based on selected beta groups. Weighting is adjusted, with higher beta stocks receiving a larger allocation in the portfolio. The research compares two beta groups (high and low) and two investment strategies (active and passive) using the Sharpe, Treynor, and Jensen indices. The results indicate that the high-beta group and active strategy outperform, aligning with the investment adage "high risk, high return." The high-beta group yields higher returns due to its increased risk profile, consistent with the notion of high-risk, high-reward investments. The active strategy provides opportunities to discard underperforming stocks and enhance the weighting of well-performing ones during recomposition. These findings are valuable for investors seeking to capitalize on BUMN stocks at lower prices. The study aids in minimizing negative returns (losses) by identifying the most suitable strategy for BUMN portfolios. Investors can leverage this research to make informed decisions and navigate the challenges associated with investing in state-owned enterprises

Financial Literacy, Emotional Intelligence for Young Investors

Changes in individual activities lead to changes in behavior. In particular, adolescents experience changes in learning and teaching activities, resulting in a gap between the amount of time available and the lack of activities that adolescents can do. It becomes a momentum for adolescents to create new activities, one of which is investing in the capital market. The relationship between emotional intelligence and adolescents’ intention to become investors, as well as the moderating effect of financial literacy in the relationship. These values indicate that the model is suitable enough to explain about 42.8%-52.6% of changes in the relationships tested.  Emotional intelligence has a positive effect on adolescents’ intention to become investors, and financial literacy is able to strengthen this influence. This study contributes to a greater understanding of the importance of emotional intelligence and financial literacy when adolescents have the intention to become investors, especially when capital market uncertainty increases. As capital market uncertainty increases, adolescents should be able to assimilate emotional intelligence with their financial literacy to obtain greater returns. It may encourage adolescents to keep choosing their career as an investor. These results have significant theoretical contributions and provide recommendations for industry and policymaker. This can encourage teens to still choose their careers as investors. These results have significant theoretical contributions and provide recommendations for industry and policymakers.

Financial Performance of Bangladeshi Listed Commercial Banks: A Generation-based Analysis

This paper aims to examine the financial performance of Bangladeshi listed commercial banks. The study analyzed the financial performances of banks categorized into three generations—first, second, and third—based on their year of commencement of operations in the country. The data of a total of 24 banks, 8 from each generation, listed in the Dhaka Stock Exchange (DSE), has been collected from audited financial statements for the time period of 13 years, from 2010 to 2022. Data has been analyzed using different ratios of profitability, liquidity, capital adequacy, operational efficiency, and credit risk. The ANOVA test also has been used to make a comparison of profitability—the return on assets (ROA), and return on equity (ROE) of the banks of different generations. According to the results, the average profitability ratios in terms of ROA, and ROE of the second-generation banks showed their credibility than banks of other generations; while first generation banks kept higher liquidity, and capital adequacy with higher credit risk than the banks of other generations. The first-generation banks also showed a lower cost-expense ratio, and a higher efficiency in terms of operation, than the banks in the second and third generations. The research also discovered that the profitability of banks of different generations significantly varies from one another.

Family environment and religiosity on anti-corruption behaviour through Islamic education at SMKN 2 Garut

This study aims to determine the effect of family environment, religiosity, and Islamic religious education on anti-corruption behavior at SMKN 2 Garut. This study uses a quantitative approach. The subjects of this study were 105 students who were selected by accidental sampling technique. The quantitative research method uses non-probability sampling, and a sample of 105 respondents is obtained. The analytical tool used is path analysis, and the hypothesis uses a significance test using the PLS-SEM analysis tool. Family environment, religiosity, and Islamic religious education can influence anti-corruption behavior by 41.2%. This study found that family environment and religiosity can directly influence anti-corruption behavior for students at SMKN 2 Garut. Family environment and religiosity can also indirectly affect the anti-corruption behavior of students at SMKN 2 Garut through Islamic religious education. Efforts to eradicate corruption are not an easy task. Efforts to eradicate corruption certainly cannot be the responsibility of law enforcement and the government but also the shared responsibility of all state components. Therefore, efforts to eradicate corruption must involve all relevant stakeholders in the family environment where the first learning occurs in a student's life

Multinational Corporations and SEO Discounts

The fact that publicly traded companies incur substantial costs when issuing new equity has been extensively documented in the empirical finance literature. In particular, numerous studies show that seasoned equity offerings (SEOs) tend to be priced significantly below prevailing market prices, thereby causing issuers to leave money on the table. Offer price discounting is an indirect flotation cost borne by pre-SEO shareholders that, according to extant theoretical and empirical research, arises due to asymmetric information. A heretofore unrelated literature argues that corporate multinationalism, i.e., establishing operations in one or more foreign countries, exacerbates the asymmetric information problem via greater costs to shareholders of monitoring the activities and performance of foreign subsidiaries. Motivated by these lines of thought, I investigate the relation between SEO discounting and corporate multinationalism. Using a sample of SEOs completed by U.S. firms between 1998 and 2016, I show that offer price discounting is significantly higher in offerings conducted by multinational firms relative to those conducted by purely domestic firms after controlling for known determinants of SEO discounts. This effect is stronger for multinational firms with foreign subsidiaries spread across a greater number of countries and weaker for multinationals that hire a high-reputation underwriter to lead the underwriting syndicate. These findings suggest that asymmetric information costs borne by seasoned equity issuers are increasing in the geographic scope of a firm’s operations, which can be mitigated by certification from a highly reputed lead underwriter

Measuring the impact of ESG investing on the stock performance of JSE-listed financial service providers during the Covid-19 pandemic

The study's objective is to examine the impact of ESG investing on the stock performance of financial service providers in South Africa (SA) during the COVID-19 pandemic. This has significant ramifications for the usefulness of ESG investing during a crisis period. To this end, the study employs the panel nonlinear autoregressive distributed lags (PNARDL). The study finds that ESG investing had a significant impact on stock performance. The error term in the PNARDL reveals that the share price of financial service providers in SA was significantly affected by ESG investing. The PNARDL shows that, on average, a 1 percent increase in ESG investing increased stock price returns by 5 percent, cetiris paribus. This crucial finding has significant implications. It implies that ESG was another significant resilience factor behind the stock performance of financial service providers. Moreover, the PNARDL found that reducing ESG investing negatively affected stock price returns, while increasing ESG investing positively affected stock price returns during COVID-19. Hence, the study recommends that financial service providers increase ESG investing during a crisis period

Assets Value Added and Assets Liquidity on Stock Liquidity: Evidence in Indonesia

The purpose of this study is to determine the impact of assets value added and assets liquidity to stock liquidity in the context and evidence in Indonesia and in relatively different situations and conditions. The novelty of this research is in the assets value added using net value-added measurements, the research was conducted in the context and evidence in Indonesia, this research was conducted in two different situations, namely 2018-2019 (before the corona virus occurred) and 2020 (the corona virus occurred). The contribution of this research fills the narrow research gap in the field of stock liquidity from the perspective of assets value added in the context and evidence in Indonesia. The population in this research are entities listed on the Indonesia Stock Exchange with a research sample of entities categorized as manufacturing entities, research year 2018-2020, data analysis methods in this research used multiple regression, moderate regression (MRA). Main Findings: (i) Assets Value Added, Assets Liquidity and Information Asymmetry simultaneously effect Stock Liquidity. (ii) Stock Liquidity is positively impacted by Assets Value Added. (iii) Stock Liquidity is negatively impacted by Assets Liquidity. (iv) Information asymmetry weakens the impact of Assets Value Added to Stock Liquidity. (v) Information asymmetry strengthens the impact of Assets Liquidity to Stock Liquidity. The results of this study provide evidence in favor of information asymmetry theory and signal theory

The effect of use, task technology-fit, user satisfaction on performance of the Kimia Farma Pharmacy employees in Yogyakarta business unit

This study aims to determine the effect of the use of information technology on employee performance, which is mediated by user satisfaction and the suitability of technology tasks. Respondents in this study were employees of PT Kimia Farma Pharmacy Yogyakarta Business Unit. The sample used was 110 respondents, with a quantitative method using SEM and AMOS. From the data that has been tested and collected, the results of this study indicate that the use of information technology has a significant positive effect on employee performance and task-technology fit. User satisfaction and task-technology fit do not mediate the positive and insignificant effects of using information technology on employee performance. User satisfaction has no positive effect on performance and is insignificant. Task-technology fit has a positive effect on performance

What drives SME formalization in Tanzania? An assessment using the machine learning techniques

Identifying the motives for business formalization is important for policy-making and the smooth coordination of entrepreneurs in Tanzania. This paper employs four machine learning (ML) models to investigate the effects of several contingents and institutional factors on SME formalization in Tanzania. Using an updated large dataset of the World bank enterprise survey in 2013, this research relies on 698 firms level data and 37 explanatory variables. The feature importance through SHAP values analysis proves that firm location in a business city, sales revenue, number of full-time employees, firm experience in the sector, and internal and external finance are the most significant factors that positively affect SME's formalization. This paper will be a reference for the actors and stakeholders in business and entrepreneurship to make good policies to drive business formalization in Tanzania