1,354,150 research outputs found
Merger and acquisitions in South African banking: a network DEA model
No full textBanking in South Africa is known for its small number of companies that operate as an oligopoly. This paper presents a strategic fit assessment of mergers and acquisitions (M&A) in South African banks. A network DEA (Data Envelopment Analysis) approach is adopted to compute the impact of contextual variables on several types of efficiency scores of the resulting virtual merged banks: global (merger), technical (learning), harmony (scope), and scale (size) efficiencies. The impact of contextual variables related to the origin of the bank and its type is tested by means of a set of several robust regressions to handle dependent variables bounded in 0 and 1: Tobit, Simplex, and Beta. The results reveal that bank type and origin impact virtual efficiency levels. However, the findings also show that harmony and scale effects are negligible due to the oligopolistic structure of banking in South Africa
The Trade-Off between Banking Outreach And Profitability: Evidence From selected South African Development Countries
No full textIn this paper, the fixed effects method known as the least squares dummy variable (LSDV) technique was applied to investigate the possibility of a trade-off between bank profitability indicators and banking outreach (expanding access to banking services) by analysing a panel of 10 South African Development Countries (SADC). Of the fifteen SADC member countries (Angola, Botswana, Democratic Republic Of Congo, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Swaziland, United Republic Of Tanzania, Zambia, and Zimbabwe), five (Botswana, Congo, Lesotho, Malawi and Zimbabwe) had to be excluded for lack of consistent data throughout our period of analysis. The author investigates whether expanding banking access and pursuing profitability are complementary goals in the same direction or are two conflicting goals. For estimation robustness, two indicators of profitability were used namely return on average assets (ROAA) and return on average equity (ROAE). IMF Financial Access Survey (FAS) data for each country namely, deposit accounts per capita and the number of bank branches per 1000 km2 were used as indicators of bank outreach or access. Operational inefficiency, insolvency risk and credit risk were found to exert a negative impact on both ROA and ROE. Net interest margin a proxy for interest based services and off-balance sheet activities were statistically significant and positively related with bank profitability. Central to the study was that expanding banking access was found to exert a statistically significant and positive impact on profitability for some SADC countries. However, contrary to the author`s expectation, for some countries, the indicator of outreach was inversely related with the chosen indicators of profitability. The researcher however, argues that any form of intervention aimed at improving the state of access to those financially excluded cannot be evaluated from a cost or profit perspective alone but must be all-inclusive taking into account the social and economic benefits to the society as a whole. The major purpose of financial inclusion is to reach the poor and disadvantaged segments of the population. Hence, the author cautions that although attaining high profitability is an important policy objective for ensuring sustainability and financial stability, it is certainly not the only priority. Access to banking services, social inclusion and consumer protection are equally important policy priorities. There is therefore need for government support and a general holistic stakeholder approach to the problem of banking exclusion in order to generate solutions that achieve both profitability and outreach in a balanced fashion
Do capital requirements affect cost of intermediation? Evidence from a panel of South African Banks
No full textSince the 2007 sub-prime financial crisis, world bank capital ratios have increased. In this paper, we investigate the impact of increased bank capital requirements introduced under the Basel Accord framework on the costs of intermediation. We attempt to answer this central question by running panel regressions using 2001 - 2012 annual bank-level data for ten banks constituting inter alia the four largest South African banks. We conclude that high capital requirements are associated with increased costs of intermediation. Our fixed effects estimations show that a one percent increase in capital requirements lead on average to a range of 12 - 14 basis points increase in the cost of intermediation during our period of analysis. We also find evidence that the Basel II capital requirements effected from 1 January 2008 contributed to increased cost of intermediation by an average 7 basis points for the period 2008 - 2012. We therefore caution that while maintaining adequate capital levels is crucial for obvious reasons, there is need for supervisory authorities to ensure that such regulation is effective and well-balanced to guarantee safety and stability of the sector without endangering the ability of the banks to service the economy
Internal Determinants Of Bank Profitability In South Africa: Does Bank Efficiency Matter?
No full textIn a study conducted by Ncube (2009) to evaluate bank cost and profit efficiency, it was established that South African banks were more efficient at managing costs than generating profits. In this paper, the aim is to complement this particular work by exploring the internal determinants of bank profitability but with more focus on the impact of bank efficiency. Applying a two step-methodology framework to a panel of four small banks and four large banks for the period 2005-2011, total factor productivity efficiency (TFPE) scores were generated using the DEA methodology. Within the first stage, the intermediation approach was followed in which bank inputs included total operating expenses, labour, fixed assets, and total deposits while interest income, non-interest income and gross loans were considered as output variables. Each bank`s efficiency score for each of the periods was then evaluated based on its distance from the constructed efficiency frontier. In the second stage analysis, the Generalised Least Squares Fixed Effects Model was then performed to examine the impact of TFPE among other internal determinant factors on bank profitability indicators, specifically return on average assets (ROAA) and net interest margin (NIM). The obtained empirical findings showed that high total factor productivity efficiency and capital adequacy lead to higher profitability, while high cost inefficiency, diversification activities, large bank size, and high credit risk leads to lower profitability. Of great importance was that both models confirmed the positive role of attaining efficiency as an important driver of profitability among banks
Budget Deficits and Economic Growth: A Vector Error Correction Modelling of South Africa
No full textThe primary motivation behind this study was to explore the consequential effects of budget deficit on South Africa`s economic growth. Six variables were used, namely: real GDP, budget deficit, real interest rate, labour, gross fixed capital formation and unemployment. The Vector Error Correction Model (VECM) was used to estimate the long-run equation and also measure the correction from disequilibrium of preceding periods. Using annual time series data spanning the period 1985 to 2015, empirical evidence from the study revealed that budget deficits and economic growth are inversely related. It was therefore concluded that high levels of budget deficit in South Africa have detrimental effects on the growth of the economy. The estimate of the speed of adjustment coefficient found in this study revealed that about 29 per cent of the variation in GDP from its equilibrium level is corrected within one year. The results obtained in this study are favourably similar to those in the literature and are also sustained by previous studies.</jats:p
Going Beyond Counting First Authors in Author Co-citation Analysis
No full textThe present study examines one of the fundamental aspects of author co-citation analysis (ACA) - the way co-citation
counts are defined. Co-citation counting provides the data on which all subsequent statistical analyses and mappings
are based, and we compare ACA results based on two different types of co-citation counting - the traditional type that
only counts the first one among a cited work's authors on the one hand and a non-traditional type that takes into
account the first 5 authors of a cited work on the other hand. Results indicate that the picture produced through this non-traditional author co-citation counting contains more coherent author groups and is therefore considerably clearer. However, this picture represents fewer specialties in the research field being studied than that produced through the traditional first-author co-citation counting when the same number of top-ranked authors is selected and analyzed. Reasons for these effects are discussed
Measuring the impact of the global financial crisis on the efficiency and productivity of the banking system in South Africa
No full textCITATION: Maredza, A. & Ikhide, S. 2013. Measuring the impact of the global financial crisis on the efficiency and productivity of the banking system in South Africa. Mediterranean Journal of Social Sciences, 4(6):553, doi:10.5901/mjss.2013.v4n6p553.The original publication is available at https://www.richtmann.orgSouth Africa`s financial sector is believed to have weathered the contagion and catastrophic effects of the 2008 worldwide financial crisis partly on account of a sound regulatory framework and solid macroeconomic policies. In this paper, we seek to measure efficiency and productivity changes during the period of the crisis through an analysis of bank performance over the period 2000 – 2010 using a two stage methodology framework. The recently developed Hicks-Moorsteen total factor productivity (TFP) index approach developed by O`Donnell as opposed to the popular Malmquist TFP was utilised. Our first stage results showed that during the crisis period there was a noticeable but mild deviation of total factor productivity and efficiency measures. Second stage analysis using the censored Tobit model showed that the financial crisis was the main determinant of bank efficiency, indicating that total factor productivity efficiency was 16.96% lower during the crisis period compared to the pre-crisis period.https://www.richtmann.org/journal/index.php/mjss/article/view/337Publisher's versio
Variations on the Author
No full text“Variations on the Author” discusses two of Eduardo Coutinho’s recent films (Um Dia na Vida, from 2010, and Últimas Conversas, posthumously released in 2015) and their contribution to the general question of documentary authorship. The director’s filmography is characterized by a consistent yet self-effacing form of authorial self-inscription: Coutinho often features as an interviewer that rather than express opinions propels discourses; an interviewer that is good at listening. This mode of self-inscription characterizes him as an author who is not expressive but who is nonetheless markedly present on the screen. In Um Dia na Vida, however, Coutinho is completely absent form the image, while Últimas Conversas, on the contrary, includes a confessional prologue that moves the director from the margins to the center of his films. This article examines the ways in which these works stand out in the filmography of a director who offers new insights into the notion of cinematic authorship
Appropriate Similarity Measures for Author Cocitation Analysis
No full textWe provide a number of new insights into the methodological discussion about author cocitation analysis. We first argue that the use of the Pearson correlation for measuring the similarity between authors’ cocitation profiles is not very satisfactory. We then discuss what kind of similarity measures may be used as an alternative to the Pearson correlation. We consider three similarity measures in particular. One is the well-known cosine. The other two similarity measures have not been used before in the bibliometric literature. Finally, we show by means of an example that our findings have a high practical relevance.information science;Pearson correlation;cosine;similarity measure;author cocitation analysis
The consequential effects of budget deficit on economic growth: a vecm analysis of South Africa
No full textMCom (Economics), North-West University, Mafikeng Campus, 2016This study was undertaken to examine the effects of budget deficit on economic growth of South Africa using the Vector Error Correction Model under the VAR framework. This study is relevant because recently, the rate of budget deficit in South Africa is high and it continues to pose risks to the economic outlook of the country. This study contributes to the debate of budget deficit reduction through measures such as fiscal consolidation and Austerity measures. To this end, the time series data set from the period from 1985 to 2015 was collected and analysed. The results of this study revealed that budget deficit is inversely related with economic progress in South Africa. The policy implication of this negative relationship is that an increase in budget deficit is detrimental to economic growth of a country. Furthermore, the study discovered that labour force participation and gross domestic investment remains the core elements that improve the economy in South Africa. Therefore, the government of South Africa should work together with private sectors, labourers and other stakeholders and should also reinforce austerity measures such as cost containment and fiscal consolidation without curtailing its priorities to ensure the effective promotion of economic growth in the country.Master
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