40 research outputs found
Monitoring bank performance in the presence of risk
This paper proposes a managerial control tool
that integrates risk in efficiency measures. Building on
existing efficiency specifications, our proposal reflects the
real banking technology and accurately models the relationship
between desirable and undesirable outputs. Specifically,
the undesirable output is defined as nonperforming
loans to capture credit risk, and is linked only
to the relevant dimension of the output set. We empirically
illustrate how our efficiency measure functions for managerial
control purposes. The application considers a unique
dataset of Costa Rican banks during 1998–2012. Results’
implications are mostly discussed at bank-level, and their
interpretations are enhanced by using accounting ratios.
We also show the usefulness of our tool for corporate
governance by examining performance changes around
executive turnover. Our findings confirm that appointing
CEOs from outside the bank is associated with significantly
higher performance ex post executive turnover, thus suggesting
the potential benefits of new organisational
practices.Peer ReviewedPostprint (author’s final draft
Corporate social responsibility and the assessment by auditors of the risk of material misstatement
This paper investigates whether, and how, firms’ corporate social responsibility (CSR) performance influences the auditor's assessment of the risk of material misstatement, whether due to fraud or error, at the financial statement level by analysing their pricing decision (i.e., audit fees). Using a panel data set of 12,330 firms from 28 countries over the period 2003–2012 and different measures of CSR performance, we find a U-shaped relationship between firms’ CSR performance and audit fees. This result suggests that there is an optimal level of CSR performance that minimizes the auditor's assessment of the risk of material misstatement, which in turn lowers the need for greater auditor effort; that is why auditors charge firms significantly less when their CSR performance is at the optimal level. Finally, we also show that the optimal level of CSR performance varies with the degree of environmental dynamism, ownership concentration and leverage.The authors also acknowledge support from the Fundación Ramon Areces, Projects ECO2013-48328-C03-3-P, ECO2013-45864-P, ECO2014-57131-R, ECO2016-75961-R and ECO2016-77579-C3-2-P financed by the Spanish Ministry of Science and Innovation and project INNCOMCON-CM(S2015/HUM-3417)
Correlation between the presence of metals with potential for intoxication, omega 3 deficiency, increased omega 6: omega 3 ratio and their associated symptoms
Objectives. The study aims to determine the correlation between the presence of heavy metals with intoxication potential (mercury, aluminum, arsenic), increasing the values for the omega 6: omega 3 ratio, decreasing the concentration of omega 3 and it’s impact on health. Another objective of this study is the use of an integrated protocol, developed by an interdisciplinary team, based on a customized alignment program and a treatment plan.
Materials and methods. We evaluated in a retrospective observational study, 77 patients who came to the Nutribalance Clinic between September 2017 and December 2019, with specific symptoms of intoxication with toxic metals, especially mercury, aluminum, arsenic and omega 3 deficiencies. The manifested symptoms required a complete set of blood tests for each sub-ject in the study group, tests that showed the presence of one, two and three toxic metals in the case of all
77 subjects.
The interdisciplinary team developed a personalized treatment and diet plan, monitoring the evolution on the symptoms initially manifested by each subject.
Outcomes. The results of this study shows the beneficial impact of the personalized diet plan and supplements used on the decrease in omega 6: omega 3 ratio, the significant increases in omega 3 which support the detoxification process of heavy metals and a significant improvement in the symptoms of each patient.
Conclusions. This study reveals that the process of chelating or detoxifying heavy metals is a complex one and that implies the presence of a complementarity between food and nutritional supplement therapy, avoiding one single direction, as results can be obtained for a short or insignificant period of time
An analysis of strategic paths through the decomposition of total factor productivity : the case of Spanish savings banks
The Spanish savings banks attracted quite a considerable amount of interest within th
Technology-based total factor productivity and benchmarking: New proposals and an application
Benchmarking for routines and organizational knowledge: A managerial accounting approach with performance feedback
This study proposes a managerial accounting research design that bridges a gap between firm productivity based on frontier techniques and strategic management. In doing so, it operationalizes the theoretical frameworks based on the endogenous components of across-firms heterogeneous resources and routines, which are fundamental for firm performance. The design focuses on industry-level benchmarking to analyze changes in performance and organizational knowledge investments, and proposes some indicators for firm-level strategic benchmarking. An analysis of a twelve-years panel of the U.S. technology hardware and equipment industry illustrates the usefulness of the proposals. Findings reveal wider gaps between better and worse performers following economic distress. Increasing intangibles stocks is positively associated with changes in frontier benchmarking, while enhancing R&D spending is linked to frontier shifts. The discussion develops managerial interpretations suitable for control and reward systems
Novel Perspectives on Technology‐Based Efficiency and Productivity Analyses
Esta tesis contribuye a la literatura sobre la eficiencia y la productividad adoptando un enfoque gerencial. Las aplicaciones empíricas se dirigen hacia el sector bancario español, industria que ha atraído un gran interés debido su crecimiento post-desregulatorio. Además, es probable que este interés se intensifique, pues la reciente crisis financiera ha generado la necesidad de reestructurar el sector y de introducir nuevas estrategias competitivas. Tres temas constituyen los capítulos centrales de esta tesis: (1) La identificación y el análisis de conglomerados bancarios a través de la descomposición de un indicador de productividad y eficiencia, (2) La formalización de nuevas propuestas para realizar benchmarking basado en índices de la productividad total de los factores (PTF), (3) La evaluación de los beneficios potenciales de fusiones y adquisiciones a través de fronteras de eficiencia convexas y no convexas. En el contexto de los grupos estratégicos, el primer capítulo analiza la productividad y la eficiencia de los bancos y las cajas de ahorros españolas durante 1998-2006. Para ello se utiliza el indicador de productividad de Luenberger, que se descompone de forma similar a los índices de Malmquist. La PTF se descompone en cambios tecnológico y de eficiencia. A su vez, esté ultimo se descompone en cambios de eficiencia pura, de escala y de congestión. Los resultados empíricos muestran que las mejoras de productividad se deben en parte a la innovación tecnológica y explican cómo se desarrolla la competencia entre los bancos y las cajas de ahorros. Posteriormente, los componentes del Luenberger se utilizan como inputs en un análisis de conglomerados. Las interpretaciones de los grupos resultantes se hacen a través de las principales diferencias entre los varios indicadores de productividad y eficiencia. Finalmente, siguiendo la literatura sobre grupos estratégicos, se introducen diversos ratios bancarios para alcanzar nuevas interpretaciones de los grupos. El segundo capítulo propone nuevas perspectivas de benchmarking para el análisis de la PTF. Se vincula así la literatura sobre el benchmarking con los estudios de eficiencia y productividad. Concretamente, varias especificaciones del índice de PTF de Hicks-Moorsteen están adaptadas a las siguientes perspectivas de evaluación comparativa: (1) estática, (2) de base y unidad fijas, y (3) cambio dinámico de la PTF. Estos enfoques utilizan empresas fijas y/o tecnologías de base como referencia. A diferencia de la mayoría de los índices de productividad, el índice de Hicks-Moorsteen estándar siempre proporciona resultados factibles e interpretables desde la PTF. Mediante estas especificaciones, un gerente puede evaluar diferentes aspectos comparativos entre la empresa y sus competidores. Las implicaciones del análisis propuesto se ejemplifican en el sector bancario español durante 1998-2006. El tercer capítulo analiza las potenciales mejoras de eficiencia obtenidas de las operaciones de fusiones y adquisiciones, un tema ampliamente estudiado pero a menudo con resultados no concluyentes. Especulamos que esto se debe parcialmente al supuesto tecnológico de convexidad que puede condicionar los resultados. Por ello, ambas tecnologías, convexas y no convexas, se utilizan para analizar las fusiones y adquisiciones y revelar las reducciones de exceso de costes debido a ineficiencias técnicas y de escala. Asimismo, se establecen condiciones ex ante para alcanzar las potenciales reducciones de costes. Utilizando una muestra de 32 procesos de fusión ocurridas durante 1988-2006 en el sector bancario español, se encuentran que significativas reducciones de costes se producen a partir de los dos años después de la fusión. Además, se muestra como las estimaciones no convexas son más próximas a los movimientos de costes observados. Estos hallazgos son relevantes dada la actual ola de fusiones provocada por la crisis financiera, y deberían ser complementados con investigaciones sobre eficiencia de gama y economías de diversificación.This dissertation contributes to the efficiency and productivity literature by adopting a managerial focus to address gaps in previous research. In doing so, it uses existing methodological tools, further developed and adapted to current needs. These proposals are applied to the Spanish banking sector, an industry that attracted vast amounts of interest due to its post-deregulation growth phase. Against the background of the recent financial crisis, this attractiveness for research of (Spanish) banks will probably escalate, as new consolidation policies from central institutions will induce novel competitive strategies. Three topics represent the core chapters of this thesis: (1) The identification and analysis of bank performance groups through decomposed productivity and efficiency indicators; (2) New proposals of total factor productivity (TFP) benchmarking via technology-based index numbers; (3) The assessment of potential gains from mergers and acquisitions (M&As) through convex and non-convex efficiency frontiers. In the framework of the strategic groups' literature, the first chapter analyses changes in the productivity and efficiency of Spanish private and savings banks between 1998 and 2006. By adapting a decomposition of the Malmquist productivity indices, it proposes similar components decomposing the Luenberger productivity indicator. TFP is disentangled into technological and efficiency changes. The latter is then decomposed into pure efficiency, scale and congestion changes. Empirical results show that productivity improvements are partially due to technological innovation and explain how the competition between private and savings banks develops. Consequently, the Luenberger components are used as cluster analysis inputs. Thus, economic interpretations of the resulting performance groups are made via key differences in TFP components. To end with, as suggested by the strategic groups' literature, insights are gained by linking these performance groups with banking ratios. Second, by proposing a benchmarking framework to analyze TFP, a gap is filled between the benchmarking literature and multi-output efficiency and productivity studies. Different specifications of the Hicks-Moorsteen TFP index are tailored for specific benchmarking perspectives: (1) static, (2) fixed base and unit, and (3) dynamic TFP change. These approaches assume fixed units and/or base technologies as benchmarks. In contrast to most productivity indices, the standard Hicks-Moorsteen index always leads to feasible results and TFP interpretations. Through the defined specifications, managers can assess different facets of the firm's strategic choices in comparison with relevant benchmarks and thus have a broad background for decision making. An analysis for the Spanish banking industry between 1998 and 2006 illustrates the feasibility and managerial implications of the proposed framework. The third chapter scrutinizes the potential efficiency gains from M&As, a widely researched topic, but often linked to inconclusive results. We speculate that this is partly caused by the employed methodological assumptions. Among them, the assumption of a convex technology can be an important influence on the results. Thus, both convex and non-convex technologies are used to reveal post-M&As cost excess gains due to scale and technical inefficiencies. Ex ante conditions for achieving potential cost reductions are devised and then tested ex post on a sample of 32 Spanish banking M&As that occurred between 1988 and 2006. Empirical results show that significant cost excess reductions appear two years after the merger event. Furthermore, it is illustrated that the non-convex estimations are closer to the movements in the observed costs. These are interesting findings in view of the upcoming merger wave and should be complemented with research on scope efficiency and economies of diversification
An analysis of strategic paths through the decomposition of total factor productivity: the case of Spanish savings banks
The Spanish savings banks attracted quite a considerable amount of interest within the
scientific arena, especially subsequent to the disappearance of the regulatory
constraints during the second decade of the 1980s. Nonetheless, a lack of research
identified with respect to mainstream paths given by strategic groups, and the analysis
of the total factor productivity. Therefore, on the basis of the resource-based view of
the firm and cluster analysis, we make use of changes in structure and performance
ratios in order to identify the strategic groups extant in the sector. We attain a threeways
division, which we link with different input-output specifications defining
strategic paths. Consequently, on the basis of these three dissimilar approaches we
compute and decompose a Hicks-Moorsteen total factor productivity index. Obtained
results put forward an interesting interpretation under a multi-strategic approach,
together with the setbacks of employing cluster analysis within a complex strategic
environment. Moreover, we also propose an ex-post method of analysing the
outcomes of the decomposed total factor productivity index that could be merged with
non-traditional techniques of forming strategic groups, such as cognitive approaches
Benchmarking for routines and organizational knowledge: A managerial accounting approach with performance feedback
Monitoring bank performance in the presence of risk
This paper devises management and accounting tools for monitoring bank performance. We first propose a multidimensional efficiency measure that integrates credit risk and is adapted to the real banking technology. Second, traditional accounting ratios complement the analysis. Third, the impact of different risk measures over efficiency and accounting ratios is shown. Fourth, we examine the effect of CEO turnover on future performance. An empirical application considers a unique dataset of Costa Rican banks during 1998-2007. Results reveal that performance improvements follow regulatory changes and that risk explains differences in performance. Non-performing loans negatively affect efficiency and return on assets, whereas the capital adequacy ratio positively affects the net interest margin. This supports that incurring monitoring costs and having higher levels of capitalisation may enhance performance. Finally, results confirm that appointing CEOs from outside the bank significantly improves performance, thus suggesting the potential benefits of new organisational practices