The Real Effects of Fintech on the Global Financial System

Purpose: Financial technology (FinTech) entails radical changes for every facet of financial services, and has increasing significance for the global economy. The purpose of this paper is to present a birds’ eye view of salient effects of Fintech on the global financial system.   Design/methodology/approach: A literature review approach is adopted, with analysis revealing that the absence of institutional support for new financial technologies is the most significant reason for the destabilization of the financial industry, and the formation of financial bubbles in various market segments. The current implications and future directions are explored based on theoretical and empirical analyses.   Findings: This study contributes to the advancement of knowledge by summarising current practices, providing new insights, and monitoring emerging trends in financial technologies, as well as shedding light on a variety of topics of interest to policymakers and academics by proposing future research topics.   Practical implications: This study emphasises the current status of research in the field of financial technology, which can assist policymakers and institutions in selecting their future actions.   Originality/value: Very few studies have conducted an exhaustive literature assessment on Fintech and its impacts on the global financial system

The mediating effect of accrual earnings management on the relationship between ownership structure and firm value: Evidence from Jordan

Firm value is considered a primary and essential driver for investors when making investment decisions, so they are interested in the quality of the financial data in companies’ annual reports related to firm value in an attempt by the owners to improve the company’s image and raise its value. Therefore, this study examined the relationship between ownership structure and firm value through the mediating role of accrual earnings management. Panel data were extracted from the financial reports of 88 non-financial companies listed on the Amman Stock Exchange for 11 years (2009–2019). The Barron and Kenny, Sobel, and other test approaches were applied to investigate the mediation effect and mediating relationships. The outcomes identified a positive impact of managerial ownership on firm value and a positive impact of foreign ownership on firm value. Also, it showed a negative impact of managerial ownership and foreign ownership on accrual earnings management, while accrual earnings management positively impacted firm value. Regarding mediating relationships, the results identified a mediating effect of accrual earnings management on the relationship between managerial ownership and firm value and a mediating effect of accrual earnings management on the relationship between foreign ownership and firm value. However, accrual earnings management does not mediate the relationship between family ownership and firm value. This shows the importance of reducing accrual earnings management through the identities of investors (managerial and foreign), which helps increase control and improve the value of a company

Does Sovereign Rating Announcement have symmetrical Effect on Stock Market Returns?Case Study: Amman Stock Exchange (ASE)

This paper aims to investigate whether the effect of Sovereign rating change is symmetrical or not. As well as are the effects are same of Sovereign rating upgrades and downgrades announcement on stock return in the Amman Stock Exchange (ASE). In this study, the event study methodology was applied to analyse the effect of ten announcements (included four upgrades and six downgrades) from the rating agency S&P500 and Moody’s over the period 2003-2013. By using the daily closing price of Amman free float market index as a proxy for return and an event period which are set as [-10, +10] days and [-5, +5] days. The findings of the study reveal the following: an asymmetrical effect of sovereign rating announcement on Amman Stock Exchange returns, upgrades rating has a significant positive reaction on prices (two out of four upgrade events have a significant positive reaction on stock price), and downgrades rating has no significant reaction on prices (one out of six downgrade events has a significant negative reaction on stock price). These findings would be useful to issuers, investors, and decision makers in assessing the credit risk of Amman stock exchange issuanc