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Background This study aims to gain insight into the effect of banks' financial performance on their market performance. We conceptualized the research subject on the assumption that the financial performance of an organization is the most important criterion for triggering movement in its stock price. We explored various models and parameters to evaluate financial performance of banks and found CAMELS being one of the most comprehensive and appropriate model. We considered share price growth of banks to measure their stock market performance Methods We collected financial and stock market data pertaining to 32 listed Indian banks for the period 2018 to 2022. The study has employed multiple linear regression analysis of panel data for evaluating the relationship between independent and dependent variables. We adopted panel regression for data analysis and used the Prais- Winsten regression with panel corrected standard errors, as the data suffers from contemporaneous cross-sectional correlation. Results The results show that net non-performing assets, net interest margins, and return on capital have a significant negative impact on share price growth. The capital adequacy ratio and the current and savings account deposit ratios have a positive insignificant impact. The liquid asset-to-total asset ratio has a negative, insignificant impact. The coefficient of determination indicates that the share price growth of banks is more dependent on other factors which are not included in the regression analysis of this study. Conclusion This study helps investors and bankers understand the limited impact of financial parameters on banks'stock prices and to look for other parameters which explain the stock price movement better.

The West African Economic and Monetary Union (WAEMU) regional securities market saw increasing activity in the last decade, but still fell short of supplying sufficient long-term financing for growth-enhancing public and private investment projects. In addition to providing an institutional background, this paper studies recent developments and the determinants of interest rates on the market-using yield curve and principal component analyses. It also identifies challenges and prospective reforms that could help the region reap the full benefits of a more dynamic securities market and assesses the potential systemic risk the market may pose for the region's banking system.

With the worldwide dispersion of COVID-19, banking sector, among others, needs to adapt to unexpected challenges. For this purpose, this study examines the impact of sustainable banking regulations on bank-specific characteristics pre and during COVID-19 period in Pakistan for the period spanning from 2006 to 2020. Moreover, financial stability is employed to test its moderating role on sustainable banking regulations. The dynamic estimator, named the system-Generalized Method of Moments, is used to analyze the endogenous nature of the data. Findings suggest that capital adequacy ratio, deposit ratio, and loan ratio are positive whereas leverage ratios are negatively related to profitability and market return. Overall, findings reveal that sustainable banking regulations influenced the bank-specific characteristics substantially. Importantly, the year-wise averages of variables reveal that Pakistani banks have made significant improvements in profitability, market return, capital adequacy, and deposit ratio pre and during pandemic era. Additionally, the financial stability significantly moderates the relationship highlighting lower default risk and the effectiveness of sustainable banking operations. Practically, despite global lockdowns, economic and trade restrictions during COVID-19, State Bank of Pakistan, sustained health of banking sector through its well-regulated monitoring mechanism.

Introduction: The Regional Development Bank (BPD Bank) is expected to be a strong, highly competitive bank, which will contribute to the growth and even distribution of sustainable regional economies. Background Problem: A review by the Financial Service Authority (OJK) of the BPD Bank’s business growth indicates the low competitiveness of the BPD Bank, relative to other commercial banks. Novelty: Limited prior studies have been conducted on the profitability determinants of the BPD Bank, especially in Indonesia, and previous studies have only focused on the internal determinants of profitability. Hence, this research aims to analyze both the internal and external profitability determinants of the BPD Bank in Indonesia. Research Method: This study analyzes 135 observations in total from all 27 BPD banks in Indonesia for five years, from 2011 to 2015. This research measured bank profitability using ROA and ROE as the dependent variables. The independent variables are the internal and external determinants of bank profitability. The internal determinants of profitability consist of TA, TCORCAP, CAR, NPL, LDR, OE/OI and NIM; whilst the external determinants include TMS, INF and BIRATE. Findings: The findings of this study show that the profitability of the BPD Bank, as measured by its Return on Assets (ROA) and Return on Equity (ROE), is significantly determined internally by the total assets, LDR, OE/OI, and NIM and externally by the BIRATE and inflation. Those variables have positive relationships with profitability, except for OE/OI and inflation, which have negative relationships with profitability. In addition, two hypotheses are only partially supported, in which the total core capital and CAR show negative relationships only with ROE. Conclusion: The findings of this paper provide a deeper insight to help manage the profitability of the BPD Bank, which eventually can promote sustainable economic development.

The repurchase rate (repo rate) serves as the primary tool of monetary policy utilised by the South African Reserve Bank (SARB) within its inflation-targeting strategy. The study examines the effect of macroprudential indicators on the repurchase rate (repo rate) established by the South African Reserve Bank (SARB). Examining the period following the Global Financial Crisis, this study explores how conditions in the financial sector influence monetary policy changes aimed at maintaining macro-financial stability. Employing the Autoregressive Distributed Lag (ARDL) bounds testing methodology, along with an Error Correction Model (ECM), the study utilises quarterly data spanning the period from 2008Q1 to 2023Q4. The model takes into account macroeconomic fundamentals, including inflation, GDP growth, external balances, and global interest rates. The findings indicate that increases in the Capital Adequacy Ratio (CAR) and household debt-to-income (DTI) ratio are associated with higher repo rates. In contrast, credit growth metrics have a countercyclical effect. The presence of a stable long-term relationship validates the importance of macroprudential factors in the development of monetary policy. Policy recommendations involve enhancing collaboration between the Monetary Policy Committee (MPC) and the Financial Stability Committee (FSC) of the SARB, augmenting macroprudential oversight, and adjusting inflation targeting to address systemic risk factors, thereby fostering both price stability and financial robustness.

In contrast to corporate defaults, regulators typically take a number of statutory actions to avoid the large fiscal costs associated with bank defaults. The distance-to-default, a widely used market-based measure of corporate default risk, ignores such regulatory actions. To overcome this limitation, this paper introduces the concept of distance-to-capital that accounts for pre-default regulatory actions such as those in a prompt-corrective-actions framework. We show that both risk measures can be analyzed using the same theoretical framework but differ depending on the level of capital adequacy thresholds and asset volatility. We also use the framework to illustrate pre-default regulatory actions in Japan in 2001-03.

The global financial crisis increased corporate world uncertainties. Therefore, to meet these challenges, firms take a more proactive approach to tackling various corporate governance and firm value initiatives and policies. This study aims to explore the moderating effect of capital adequacy on the relationship between board characteristics and the firm value of listed banks in Pakistan. To obtain a more robust empirical model and results, this study incorporates moderator and control variables. This study is based on half-yearly secondary data of 560 sample observations from 2009 to 2021. Multiple regression and panel data estimation techniques were employed for the analysis. The study used firm value as a dependent variable, proxied by Tobin’s Q, along with five independent variables, one moderating variable, and two control variables. The results of this study indicate that a higher capital adequacy ratio (CAR) increases firm value and has a moderating effect on board characteristics and firm value. Low proportions of women and independent directors on board affect firm value. The presence of risk management and audit committees in listed Pakistani banks, on the other hand, increases firm value. The banks in Pakistan have no problem with CEO duality. The study also found that bank size has a positive relationship with firm value, while bank age has a negative relationship with firm value.

This study aims to examine the determinants of profitability as measured by return on assets, with capital adequacy ratio, loan to deposit ratio, net interest margin as independent variables, and non-performing loans as independent and moderating variables. The research was conducted through the Indonesia Stock Exchange (IDX) website, namely www.idx.co.id with the population being the saturated sample being State-Owned Enterprise Banks of the Republic of Indonesia. The research period is ten years, from 2011 to 2020. The test is carried out using panel data regression using a common effect model. The results show that the capital adequacy ratio has a significant negative effect, the loan to deposit ratio has a significant negative effect, the net interest margin has a significant positive effect and non-performing loans have a significant negative effect on profitability. In addition, as a moderating variable, the results show that non-performing loans are proven to be moderating by weakening the effect of the loan to deposit ratio on profitability. While the effect on the capital adequacy ratio and net interest margin is not proven.

The simultaneous unwinding of leveraged positions can trigger financial market turbulence. Although balance-sheet measures of leverage are available, it is useful to construct a measure of leverage that incorporates both on- and off-balance-sheet activities. This paper provides measures of leverage implicit in derivative contracts by decomposing the contracts into cash market equivalent components. A leverage ratio can then be calculated for this replicating portfolio, which consists of own funds (equity) and borrowed funds equivalents (debt). Methods for aggregating leverage by institution and by markets are presented. The interaction between leverage and risk is discussed, and a modified capital adequacy ratio is calculated, which captures off-balance-sheet exposure.

Implementation of Basel III guidelines necessitates, besides other measures, maintenance of additional capital buffers. The recommended capital adequacy ratio has been enhanced in phases to steer the banks gradually towards the ideal capital requirement. This study empirically examines the impact of regulations on the changes in capital and risk. An unbalanced panel data of Indian commercial banks, comprising 27 public and 31 private sector banks, is examined from 2002 to 2021. The capital adequacy ratio (CAR) maintained by the bank, against the minimum regulatory requirement, is used for the assessment of the target capital. The study employs a simultaneous equation model along with the Three Stage Least Square (3SLS) regression method. Two separate models based on risk weightage are employed to understand the relationship between capital and risk through the risk weight assignment. The findings suggest that the regulations have more impact on undercapitalized banks and the private sector banks have fared better than the public sector banks in sustaining higher CAR.