516 research outputs found
Meeting the double bottom line: the impact of Khushhali bank's microfinance program in Pakistan
Is it possible for microfinance institutions to simultaneously pursue profits and poverty reduction? This study explores this question by analyzing the impact of Khushhali Bank, the largest retail microfinance bank in Pakistan. Khushhali Bank has shown that it can scale up outreach while remaining focused on the core goals of operational and financial sustainability. Using primary data collected from over 2,000 rural and urban households across Pakistan, the study examines whether the bank also had an impact on economic or social measures of poverty, including empowerment of poor women, or income generating activities run by those households. The poorest of the poor - those subsisting on less than half the official poverty line - are demonstrated to have benefitted the most from the program.microfinance, poverty, impact, empowerment, financially sustainable, commercial
The role of foreign banks in post-crisis Asia: the importance of method of entry
This study examines the role of foreign banks in post-crisis Asia, focusing particularly on the four countries most affected by the Asian Crisis of 1997 - Indonesia, Korea, Malaysia and Thailand. First, using data on the presence of foreign banks via branching as well as subsidiaries, the study shows that the presence of foreign banks in the four crisis-hit countries is actually much larger than has been previously reported once the presence of foreign branches is accounted for in the data. However, the percentage of assets controlled by foreign banks in Asia is still lower than that of other emerging economies, despite great increases in the post-crisis period. The author reviews regulations on foreign bank entry that may have limited the presence of foreign banks or influenced the method of entry (branching versus subsidiary). Given recent regulatory changes and the need for bank recapitalization in the region, the presence of foreign banks is expected to increase in the near future, so this study next takes up the policy implications of this trend. To date, foreign banks in most Asian countries appear to perform relatively worse than their domestic counterparts as measured by return on equity, cost to income ratios, and the ratio of problem loans to total loans. This finding contradicts previous research in other emerging economies, and may be due to the fact that foreign bank entry in Asia is still a very recent phenomenon, and has occurred mostly through the takeover of troubled banks in the region. The second policy issue examined here is the stability of lending by foreign banks relative to domestic banks. Macroeconomic data suggests that foreign bank lending may in some cases be more stable than domestic bank lending, particularly during crisis, but that the stability of foreign bank lending varies greatly by method of entry. Cross border claims of foreign banks are the most volatile, followed by foreign bank branch lending. Lending by foreign bank subsidiaries capitalized in the host country appear to be more stable than domestic lending, perhaps providing much needed capital during times of crisis. Therefore, foreign banks play an important role in Asia, not only in the traditional ways by providing new services and stimulating competition and efficiency, but also by contributing to stability of the banking sector in the face of macroeconomic fluctuations. However, the mode of foreign entry seems to have important implications for the contributions of foreign banks. Since lending by off-shore banks and foreign bank branches seems to be more volatile than locally capitalized foreign subsidiaries, policy makers in Asia should encourage foreign players to enter via fully-owned subsidiaries or joint ventures and move away from the previous pattern of branch-based entry.bank; Asia; foreign
The Effect of the Basel Accord on Bank Lending in Japan
This study investigates the hypothesis that stricter capital adequacy requirements introduced under the 1988 Basel Accord caused Japanese banks to restrict loan growth. Using a panel of Japanese bank balance sheets for fiscal years 1982-1999, this study finds that the 1988 Basel Accord regulation requiring international banks to hold a BIS (Bank for International Settlements) capital to risk-weighted asset ratio of at least 8% increased the sensitivity of total loan growth to capitalization for international banks in Japan. A similar, but quantitatively smaller, finding is reported for a group of "switcher" banks that initially pursued the 8% BIS capital adequacy requirement following the signing of the Basel Accord in 1988, but then later switched to pursue a domestic 4% MOF (Ministry of Finance) capital adequacy requirement. Domestic banks, which were subject to the 4% MOF capital adequacy requirement for the entire post-Basel period, show no evidence of increased sensitivity of lending to capitalization in the post-Basel period.Japanese Banks, Capital Adequacy, Basel Accord, Credit Crunch
Taipei,China's banking problems: lessons from the Japanese experience
Over the past decade, the health of the banking sector in Taipei,China has been in decline. Falling returns on assets and equity, steadily rising non-performing loans and bank runs at smaller financial institutions have highlighted problems across the banking sector as a whole. This study analyzes both the causes of, and policy responses to, the banking sector problems in Taipei,China, drawing comparisons from the experience of Japan. The author shows that there are many valuable lessons to be learned from the Japanese experience. In particular, policy makers in Taipei,China are urged to heed the early warning signs of overall banking sector problems and to avoid the policy of forbearance. Importantly, a hoped-for macroeconomic recovery cannot be relied upon to help banks âgrow outâ of their problems.bank, crisis, Taiwan, Japan
Recommended from our members
Children's bodies: the battleground for their rights?
The UNCRC has changed profoundly ideas about adult/child relationships and there is now an acknowledgment in both law and policy that children have a right to be consulted and to participate in decisions made about their lives. This has been widely discussed and critiqued and one of the most significant battlegrounds for debate has been childrenâs rights to consent or refuse medical treatment and the issue of exactly who has the right to control childrenâs bodies. This article will compare several cases where the English and Scottish courts have made various decisions and rulings about the extent to which children do have rights to control their bodies. It will question why, twenty years after the UK ratified the UNCRC, children are still considered incompetent in matters concerning their own bodies, unless proved otherwise, while adults are automatically considered competent unless shown not to be and will analyse whether this situation is compatible with a childrenâs rights agenda
Rural childrenâs work and school education in the context of rapid economic growth in South Korea
This paper explores how childrenâs work, in its broadest sense, and the related values and attitudes concerning childhood, have evolved in the context of rapid economic growth in South Korea. It discusses how ideas about childrenâs main activities, and their status and relationships within the family, have changed and how childrenâs roles and responsibilities are seen by members of different generations. It interrogates the changing ideas of work in contemporary childrenâs lives and presents data from a relatively under-researched part of the world
The Effectiveness of Bank Recapitalization in Japan
This study examines the effectiveness of bank recapitalization policies in Japan. Based on a careful reading of the "business revitalization plan" submitted by banks requesting government funds, we identify four primary goals of the capital injection plan in Japan: 1) to increase the bank capital ratios 2) to increase lending, in particular to small and medium enterprises, and avoid a "credit crunch" 3) to increase write-offs of non-performing loans and 4) to encourage restructuring. Using a panel of individual bank data, we empirically estimate the effectiveness of the Japanese government policy of public fund injection in achieving the first three of these stated goals. Our empirical analysis of international and domestic banks reveals that the capital injections going to the larger international banks were more effective than those used toward regional banks in Japan. The first capital injection in 1997 was effective primarily in helping international banks to clear the 8% capital adequacy ratio (BIS ratio) required under the Basel Accord. The second round capital injections seem to have been even more effective, boosting capital adequacy ratios for the regional as well as international banks, and encouraging other policy objectives such as increased lending to small and medium enterprises.
Great expectations: microfinance and poverty reduction in Asia and Latin America
Microfinance institutions (MFIs) are often seen by aid practitioners as a manifestly effective means of improving the position of the poor. Despite this widely held view, detailed research studies have been much more guarded about the impact of MFIs. In particular, several studies have raised doubts about the effectiveness of MFIs in reaching the âcore poorâ. This paper surveys the evidence from Asia and Latin America and contrasts experiences in the two regions. Studies on the former have been carried out more ârigorouslyâ, but in both regions the evidence that microfinance is reaching the core poor is very limited.microfinance; poverty; Asia; Latin America
The Japanese Big Bang: the effects of "free, fair and global"
The Japanese âBig Bangâ financial deregulations started in 1996. The objective was to make the Japanese banking sector more âfree, fair and globalâ, spurring competition and resulting in a more profitable and efficient financial sector. The Big Bang brought about a massive consolidation of Japanâs already relatively concentrated banking sector. Japanâs âTop 20â banks have now merged to just three financial conglomerates that are among the largest in the world. Is this a sign of the success? Focusing on the Big Bangâs stated objectives of promoting profitability and efficiency, this study examines the Japanese âBig Bangâ deregulation from its start in 1996 to completion in 2001, and the following eight years. On profitability, we find that the banking sector as a whole did not become more profitable than the pre-deregulation period. Rather, we see a steady decline in profitability. In addition, the main targets of the deregulation (and the most active in mergers and acquisitions activity during our sample period), the city, trust and long-term credit banks, actually exhibit lower profitability measured in ROA and ROE than the smaller regional banks. The âBig Bangâ did not succeed in promoting a more profitable banking sector. We next turn to efficiency. We find that in terms of cost reduction, the banking sector did become more efficient after the Big Bang deregulation. However, the real bottom line of performance, profit efficiency, declined. In addition, we again see a significant difference between the big city, trust long-term credit banks and the smaller regional banks. The biggest banks are statistically significantly less profit efficient, despite their higher cost efficiency. Thus, on the whole, the Japanese âBig Bangâ financial deregulation was not successful in achieving its stated objectives. Both profitability and efficiency declines on the whole, and the main targets of the deregulation, the big city, trust and long-term credit banks, exhibit statistically significantly lower profitability and efficiency than their smaller counterparts.deregulation; profitability; efficiency
- âŠ