Dissertations / Theses on the topic 'Banks and banking Australia Deregulation'

Thesis (Ph.D.)--University of Western Sydney, 2007.
A thesis presented to the University of Western Sydney, College of Business, School of Law, in fulfilment of the requirements for the degree of Doctor of Philosophy. Includes bibliographies.

This research examines competing theories based on the strategic choice and organizational ecology perspectives by investigating strategic change in the banking industry precedLng and following interest rate and product deregulation of financial institutions in the early 1980's. Adaptation theory suggests that the largest, oldest, and most powerful organizations have superior capacities for adapting to environmental circumstances and that organizational variability reflects changes in the strategy and structure of a firm in response to environmental changes. The organizational ecology perspective hypothesizes that a firm's ability to change is inversely related to organizational age and size and that organizations become inert as they grow and age. The propositions and hypotheses in this research examine the relationship between organizational age and size on both absolute and relative inertia. The association between strategic change on firm survival is also explored. Findings demonstrate partial support for both theories. An explanation for the mixed findings is offered which suggests that both adaptation and organizational ecology theories explain continuous change, while the deregulation period under study represented a period of discontinuous change. A third model of strategic change, proposed by Meyers, Brooks, and Goes (1990) is offered as a better explanation of strategic change among U.S. banks during the decade following deregulation.
Ph. D.

The purpose of this thesis is to analyze the drivers and dynamics of credit losses in Australasian banking over an extended period of time in order to improve the means by which financial institutions manage their credit risks and regulatory bodies safeguard the stability and integrity of the financial system. The analysis is based on a specially constructed data base of credit loss and provisioning data retrieved from original financial reports published by Australian and New Zealand banks. The observation period covers 1980 to 2005, starting at the time when such information was published for the first time in bank financial statements. It moreover covers the time of major crises which occurred in both Australia and New Zealand in the late 1980s and early 1990s. The heterogeneity of reporting the data both amongst banks and through time requires the development of a reporting typology which allows data extraction with equivalent informational content. As a thorough study of credit risks requires long data series often not available from third party data providers, the method developed here will provide value to a range of researchers. Based on an evaluation of many alternative proxies which track a bank's credit loss experience (CLE), the thesis proposes a preferred model for impaired assets expense (as % of loans) as dependent variable, mainly because of its timely nature and good data availability. Explanatory variables include aggregate macro variables of which changes in unemployment and the return in the share markets are found to have the most significant influence on a bank's credit losses. Bank-specific control variables include a pre-provision earnings proxy whose significance points to the use of provisions for the purpose of income smoothing by Australasian banks. The model also controls for size and nature of lending as smaller, retail-oriented housing lenders, on average, exhibit lower loan losses. Clear results are found with regard to the effect of rapid expansion which appears to be followed by a surge of bad debt provisions 2 to 3 years later. Moreover, inefficient banks tend to suffer greater credit losses. An important part of the thesis looks at the characteristics of alternative CLE proxies such as stock of provisions, impaired assets and write-offs which have been used by earlier literature. Estimating the preferred model with such alternative CLE parameters confirms their peculiarities such as the memory character of stock of provisions and the delayed nature of write-offs. These measures correlate rather poorly amongst themselves which calls for caution in the comparative interpretation of earlier studies that use differing CLE proxies.

Mestrado em Finanças
Durante a década de 90 o setor bancário mundial passou por mudanças significativas. Um processo de internacionalização teve início em países desenvolvidos e em desenvolvimento, caracterizado por uma desregulamentação financeira, com barreiras de entradas mais fracas, globalização e desenvolvimento tecnológico. Após a crise Mexicana alguns países em desenvolvimento tiveram necessidade de realizar uma recapitalização no setor. A situação no Brasil era um pouco diferente, pois o país possuía um sistema financeiro com instituições problemáticas e para o aperfeiçoar havia necessidade de as vender ou de transferir o seu controlo. A privatização e o processo de internacionalização tornaram-se numa solução para este problema, e tiveram um papel muito importante durante este período. Este estudo analisa os efeitos da abertura do sistema bancário Brasileiro, e compara-os com o esperado de acordo com a teoria da internacionalização bancária. Diferenças de acordo com a dimensão dos bancos também serão estudadas, através da introdução de pequenos e médios bancos na amostra. A análise foi realizada utilizando dados de 18 bancos nacionais com portfólio comercial, durante o período de 1997 a 2007. Os resultados demonstram que o caso Brasileiro foi atípico, e assim difere do esperado de acordo com a teoria. A análise revelou que a rentabilidade dos bancos Brasileiros não diminuiu com a internacionalização do setor, pelo contrário até aumentou durante este período. Os resultados também permitem concluir que não houve um aumento da eficiência destes bancos nacionais em geral, na realidade os custos destes bancos aumentaram ao longo do tempo, negando a hipótese teórica de que deixariam a sua "quiet life". No entanto a associação existente entre ativos e eficiência, mostra que os maiores bancos se tornaram mais eficientes durante este período.
During the 90s, the banking sector went through significant changes worldwide. An internationalization process began in developed and developing countries, characterized by financial deregulation, weaker entrance barriers, globalization and new technological developments. In some developing countries, after the Tequila banking crisis, there was the need to recapitalize the sector. The situation in Brazil was different, the country had a financial system with problematic institutions and in order to improve it, these institutions had to be sold or had to have their control transferred. Privatization and internationalization were an answer to these problems, and had a crucial role during this period. This work analyses the results of the opening of the Brazilian banking sector, and compares it to what is expected according to the multinational banking theory. Differences between bank sizes will be studied by introducing smaller banks in the sample. The analysis is made by using data from 18 private Brazilian banks with a commercial portfolio, between the period of 1997 to 2007. The results show that the Brazilian case was not typical and that it does not follow what is expected by theory. It shows that national bank profits did not decrease during internationalization; as a matter of fact, it only increased recently. The results also show that national banks did not become more efficient in general and actually have increased their costs, going against the "quiet life" hypothesis. However the association with assets and efficiency shows that bigger banks probably became more efficient during this period.

Thesis (MDF)--Stellenbosch University, 2015.
ENGLISH ABSTRACT: South Africa has experienced a significant growth in household unsecured credit extension, igniting concerns around the potential negative impact of household indebtedness on the stability of the banking system. With the use of correlation and ordinary least squares, the study attempts to prove a relationship between growth in unsecured lending (dependent variable) and consumption, lending rates and de-regulation (independent variables). Although there is a correlation between growth in unsecured lending and interest rates, this was not statistically significant. The study also found a strong relationship between unsecured lending and the other independent variables. Due to income and wealth inequality exacerbated by the past political dispensations as well as continued rise in the cost of living, unsecured lending provides a source of supplementary income that allow households to smooth their consumption expenditure over their life-cycle. On a longerterm basis, the country needs to gear itself to focus primarily on channelling resources towards productive investments. Quality education and skills as well as a culture of entrepreneurship and wealth creation should be cultivated at a young age.

The purpose of this study is to investigate extent to which Australian banking corporations embrace social responsibility. It endeavours to establish the meaning of social responsibility generally and corporate social responsibility (CSR) in particular. In view of the multiple definitions of the concept of ‘social responsibility’ offered by various authors Such.1 Boatright (1993), Freeman (1994), Walters (1977), and Wheeler (1998), the views of power dependent Australian bank stakeholders were solicited to form an operational definition for the study. This created a collective conception of social responsibility as it is applied to Australian banks, allowing corporate social responsibility standards to be established against which perceived social responsibility performance of Australian banks could be compared.

Observers of neo-liberal persuasion claim that a financial system free of government regulation can lead to better allocation of resources and if the actual process of deregulation is done properly, the results can benefit society as a whole. Deregulation requires dismantling those state-based banking structures that are perceived as economically inefficient. This approach sets up a dichotomy between financial deregulation, which is portrayed as an intrinsic part of economic progress, and state regulation, which is seen as a force that interferes with entrepreneurial freedom and efficiency. This thesis argues that such a dichotomy can only be possible within the dominant neo-liberal discourses on the economy that have displaced Keynesian style economic management in core and peripheral areas of the world. Following Marxist structural approaches I also argue that financial deregulation is a class-based project that opens up profit sites and reflects the crisis in capitalist accumulation occurring in the latter part of the 20th century. Unlike neo-liberal followers I contend that the role of the state in maintaining and/or transforming capitalist structures in order to achieve certain outcomes (whatever they might be) is crucial in nation-building strategies in peripheral countries such as Costa Rica. As in many other countries, credit allocation was actively used in this country, for some thirty years in order to achieve high levels of investment, economic planning and re-distributive policies. However, the once fully nationalised banking system, as one of the few mechanisms available to the state to regulate savings and offer credit to different socio-economic groups, has gone through dramatic changes in the period from 1980-2000. Using a modified version of Hirschman's exit/voice framework for financial systems and available institutional data, I suggest that Costa Rica has moved from having a financial system that was predominantly owned by the state (public) and whose institutional arrangements were elite-led to one whose ownership is mixed but still led by elites. However if the trend persists I anticipate that it will become a predominantly privately owned system with an equal mixture of elite-voice and exit institutions.

This study examined consumers' perceptions post-adoption of technology and how these perceptions affect their levels of dis/satisfaction and their continued use of technology·assisted service encounters. To this end, this study investigated the criteria that consumers in Western Australia's retail banking industry are likely to use when evaluating banking transactions involving EFTPOS, ATM, telephone, and Online banking modes. II examined whether these criteria changed with the mode of electronic banking in use and whether the significance of the criteria changed with consumers' demographic characteristics. In addition, this study explored whether consumers who use these modes of electronic banking experience the paradoxes of technology adoption identified by Mick and Foumier (1998). Previous studies have shown that when evaluating the quality of services provided by organizations and their levels of dis/satisfaction with these services. Consumers are likely to base their judgements on their perceptions of the service delivery process (Lehtinen & Lehtinen, 1982; Brogowicz, Delene, & Lyth, 1990; Dllllllher & Mattsson, 1994; Danaher & Mattsson, 1998; Gronroos, 1998; Swam:, 1998). In particular, the studies have shown that the most significant element of the service delivery process is personal contact, that Is the interactions between organisations' personnel and their customers (Sclmeider & Bowen, 1985; LeBIIUic & Nguyen, 1988; Parasuraman, Zeithaml, & Beny, 198fl; Howcroft, 1993; Donner & Dudley, 1997; Nichols, Gilbert, & Roslow, 1998; Tan, Beaumont, & Freeman, 1999; Gabbott & Hogg, 2000). However, technological advancements have meant that some service organisations have changed their service delivery processes by substituting contact personnel with service delivery technologies. Consequently, consumers have been producing and delivering services for themselves by interacting with the service delivery technologies that are available (Bancel-charensol, 1999). Researchers assert that changing the characteristics of the service delivery process can result in changes in how consumers evaluate the quality of services provided by organisations and how they assess their resulting levels of dis/satisfaction (Chase, 1978; Lovelock & Young, 1979; Gronroos, 1984; Zeithaml, Parasuraman, & Beny, 1990). As such, this study examined the effects that retail banking technologies have on consumers' evaluations of the service encounter and how these evaluations translate into usage patterns. Data were collected using qualitative and quantitative research methodologies. The minimum of the qualitative phase of the study was to identify the criteria that consumers are likely to use when evaluating their technology-based banking transactions and the paradoxes of technology adoption that they are likely to experience. Twenty in-depth interviews were conducted with consumers who reported they use at least one of the four modes of electronic banking. The interviews were tape-recorded and analysed using N.U.D.I.S.T. software. The second phase of the study examined consumers' opinions towards relevant criteria identified in the qualitative phase and the effect these criteria have on consumers' use of the four modes of el«1ronic banking. Data for this stage were collected through a mail survey questionnaire that was mailed out to a sample of 1700 Western Australians. In total, 453 useable questionnaires were returned. The data were imported into SPSS v. 10 and analysed using non-parametric statistics. This study showed that consumers are likely to evaluate their electronic banking service encounters on the basis of perceived convenience, transaction aids available, and perceived risk. The findings also indicate that these criteria have sub dimensions. Perceived convenience relates to the perceived ease of transactions, perceived speed of transactions, and accessibility to consumers' transaction accounts from different locations and beyond the bank's traditional operating hours. The transaction aids include the voice prompts available with telephone banking and the visual cues available with Online banking. Perceived risk dimensions include psychological, performance, financial, and physical risks. The present study also showed that some criteria have a greater effect on consumers' use of some modes of electronic banking than others. For instance, in regards to voice prompts, psychological and performance risks appeared to have an effect on the number of tell-phone banking transactions consumers are likely to conduct. Consumers who use electronic banking can experience six of the eight paradoxes of technology adoption identified by Mick and Fournier (199g): freedom/enslavement, control/chaos, engaging/disengaging, efficiency/inefficiency, fulfils/create needs, and competence/incompetence. The findings showed that in most case one side of the paradox dominates. It appears that existing theories, instruments, and techniques of evaluating the service encounter need to be adapted to be applicable to technology-assisted service encounter;. Specifically, these theories, instruments, and techniques need to minimise or exclude elements that require consumers to evaluate their interactions with and perceptions of organisations' customer service personnel and replace them with dimensions relating to consumers’ interactions with the technologies that facilitate the service delivery process. However, an exception needs to be made for technology-assisted service encounters conducted using the telephone because in these service encounters consumers can access organisations' customer service representatives, The findings were used to propose the TASE (technology-assisted service encounters) model, which includes items relating to the three main dimensions of perceived convenience, transaction aids, and perceived risk. The TASE model can be adapted and used to measure consumers’ evaluation of the service delivery processes of organisations in various service industries. The findings of this study have significant managerial applications. Organisations can use these findings to assess the viability of commercial technologies that they intend to implement by examining consumers' perceptions of new technologies based on the relevant criteria and paradoxes identified in this study. In addition, organizations can use these findings to develop promotional strategies that address consumers' concerns about using technology-based service delivery options in order to encourage them to participate more in the service delivery process. In addition the proposed T ASE model can be used to develop an instrument for measuring consumers' levels of dis/satisfaction with technology-based service encounters in general.

The neo-liberal policies of liberalization and deregulation, as utilized by the International Monetary Fund (IMF) in its dealings with countries of the developing world, tend to facilitate the conditions for financial crisis. This can be traced by examining the economic crises of Mexico in 1982 and 1994/95, Asia in 1997 and Russia in 1998 and looking at the main causes and triggers of these crises. It is evident that the financial vulnerability that these countries suffered from existed due to, and not in spite of, these policy prescriptions. The IMF continues to present these policies as proven successes - a view that this dissertation contests. Further to this, the policies that the Fund uses are formulated for use in semi-peripheral economies and have little relationship to the actual economic environments of peripheral countries such as those of sub-Saharan Africa or Papua New Guinea. The ideology of free-markets and globalization is seen as unassailable by the IMF. By encouraging countries to remain part of the global financial system through debt rescheduling and open-markets policies, the IMF holds an increasingly fragile economic environment together. This dissertation formulates and tests four hypotheses in relation to Mexico, Asia, Russia and Papua New Guinea and the periphery. These are - (1) If there are periods of 'irrational exuberance' among investors in Third World debt, these are likely to contribute to debt crises. (2) If IMF policies are implemented in the Third World as dictated, then their primary benefits will accrue to the elites in those countries and in the developed world. (3) If Third World countries open their economies to foreign capital, then they are more likely to experience debt crises. (4) If IMF policies are implemented in peripheral countries, then they are even less likely to be successful than in semi-peripheral countries.

In many countries, different degrees of banking instability occurred following a complete financial deregulation, although the reasons for the instability varied. It was widely recognised that macroeconomic instability was responsible for the failure of financial deregulation in several countries. Another important reason for banking instability was the moral hazard problem that emerged after financial deregulation. Under central bank guarantees of bank deposits, the complete removal of traditional regulations led banks to take on excessive risk. Several other reasons for the banking failure such as inappropriate sequencing of economic reform and inadequate supervision of banks were identified. Responding to concerns about banking instability, this thesis examines the positive and negative effects of financial deregulation on the development of banking in Indonesia. The Indonesian experience is a classic example of the trade-off between financial deepening and banking instability under financial deregulation with central bank guarantees and without adequate supervision of banks. The presence of externalities associated with the use of money on the one hand, and systemic risk such as the risk of a run on the payments system on the other, makes free market competition in banking, without central bank intervention, not feasible. This thesis, therefore, models the relationship between the central bank and commercial banks in the context of a loan insurance scheme. The model extends the literature on optimal risk-sharing contracts to the banking sector. In so doing, different utility functions, which are more representative of the banks' utility functions, are introduced. The model aims at allowing the central bank to eliminate the moral hazard problem in bank lending and at the same time give assurance or confidence to depositors. As the model is a theoretical exposition of the relationship between a central bank and commercial banks, it stops short of providing a 'blueprint' for such an optimal risk-sharing contract. To achieve this, simulations of the theoretical model will need to be done, and this is the subject of further work in the future.

碩士
輔仁大學
管理學研究所
85
A comparison of Expense-preference behavior and performance of listed 　　banks after deregulation on Banking in Taiwan 　　After the deregulation on Banking in 1991, the banking industry structure was from monopoly competition toward perfect competition.The change in industry structure and official banks''going publicaccelerated by government leads to differennt industry structure and ownership structure.The study investigate the expense-preference behavior and performance of listed banks before and after the deregulation including industry structure and ownership structure variables. 　　The results are as follows: 　　一On Expense-preference behavior 　　(1)Listed banks before deregulation have non-interested expense-preference behavior acd advertising expense preference behavior, but the expense-preference do not exist after deregulation. 　　(2)The expense-preference is more easily affected behavior of listed commercial banks than that of small business banks. 　　(3)The shares held by the board of directors and supervisors will significantly enforce exspense-preference behavior. 　　(4)The expense-preference behavior of small business bankis enforce after joining deposit insurance. 　　(5)The small business banks tend to have more expense-preference behavior than the commercial banks do. 　　二On performance of banke 　　(1)The empirical result of commercial banks doesn''t accept S─C─P hypothesis and performance hypothesis. 　　(2)The more the shares held by the board of directors and supervisors, the lower the small business banks''performance was. 　　(3)Regulations on banking lowed to performance of listed banks.

A central concern in economics is explaining the allocation of resources, its consequences for economic activity and the distribution of the associated economic revenues. This dissertation contains three essays examining the average and distributional effects of reallocations resulting from liberalization reforms or trade shocks. Chapter 1 examines the distributional effects of trade liberalization. A vast literature demonstrates that liberalization is associated with higher wage inequality. Nearly the entire literature considers comparative statics or steady states, which ignore dynamics and of necessity feature monotonic changes. I address these limitations by developing a micro-founded model that emphasizes the dynamics of reallocation between heterogeneous firms and workers in the presence of costly labor adjustments. Trade liberalization provides firms both new export markets and new sources of competition. Expanding high-paying firms increase wages to recruit better workers faster. Workers at firms threatened by competition accept wage cuts to delay their employers' exit and keep their job. This provides novel implications for both aggregate and within-firm inequality across a distribution of firm types. I show that key mechanisms of the model are consistent with a wide range of facts, some of which being examined in greater details in chapter 2. Results from the calibrated model suggest an overshooting of inequality on the path to a new steady state. This is consistent with evidence based on an event study of recent liberalization episodes. Inequality appears to peak about six years after liberalization, with one-fourth of the overshooting disappearing in the following ten years. Chapter 2 investigates the effects of firm growth on hiring and separations. I contribute to the literature on worker flows by studying the wages and characteristics of new and separated workers. First, I show that separations are an essential and robust component of firm growth. I argue that this may be the result of a more intense search for better matches at faster growing firms. Second, I find that wage offers to new hires increase with firm hiring rates. This is partly the result of the selection of more experienced workers. However fixed unobservable and variable observable worker characteristics cannot fully explain this relationship: the residual wage of new hires is significantly associated with the firm hiring rate. We interpret this as direct evidence of the firm-level upward-sloping labor supply curve predicted by the canonical models. We provide estimates of the slope of the curve using an instrumental variable approach to control for supply shocks. We find that a 10% increase in the hiring rate results in a wage increase of 1%. In chapter 3 Jaromir Nosal, Jonathan Vogel and I ask the following: What is the contribution of industry reallocation and productivity changes to the economic gains resulting from banking deregulation? How does local industrial structure determine the outcomes of banking deregulation? This chapter uses the staggered reforms of the banking sector in the U.S. between 1977 and 1997 to empirically investigate these questions. In the private sector, we show that the deregulation-induced reallocation of workers was directed towards industries with lower GDP per worker. Moreover, employment gains were associated with a reduction in productivity. Nevertheless we find that these effects are offset by across the board within-industry productivity gains. In addition, total output and aggregate productivity increased because of the reallocation of workers out of unemployment, self-employment and non-private industries towards the more productive private sector. Finally we find that initial industry mix can explain up to one third of the variation in state aggregate responses.

One of the reasons for firms decentralising aspects of their operations is to enable managers to gain specialised knowledge of local conditions. For credit managers in a banking firm, this may take the form of knowledge of investment opportunities and the risk profiles of each of these opportunities. In light of principal-agent problems that arise when information is asymmetrical, the focal point of this dissertation is the development of incentive-compatible mechanisms that facilitate the free and accurate disclosure of the private information of managers on the risk profile of investments to the centre of the bank at the time investment decisions are being implemented. These mechanisms are required because managers may have strong incentives to misrepresent their private information when doing so has the potential to favourably impact on the size of their remuneration. This, in turn, has a direct impact on the ability of the centre to optimally allocate the capital of the bank and effectively price risk into bank investments. The dissertation commences by examining which internal risk measures act to align the investment decisions of managers in a bank with the risk/return goals of the centre of the bank. This requires knowledge of the bank risk preference function. It is initially assumed that managers have developed specialised knowledge of the opportunity set of available investments, and have no reason to misrepresent this information to the centre. This assumption is later removed and the implications assessed. In order to ensure incentive-compatibility between the centre and managers, a truth-revealing mechanism is employed in the capital allocation process and tied to the compensation payment function of the bank. This mechanism acts to ensure managers disclose their private information on the expected risks and returns in the investments under their control, and facilitates the efficient investment of capital within the bank.
Doctor of Philosophy (PhD)

The dissertation seeks to contribute to the existing body of work in the area of Islamic finance by examining the extent of divergence in practice of Islamic financing from the traditional Shari`ah in the Australian context. To this end, the dissertation presents a discursive analysis of the regulation of Islamic Finance in Australia in terms of (a) the financing instruments used, (b) certainty of transactions between participants in the system, and (c) institutional risk management of Islamic Financial Institutions (IFIs). The methodology chosen for the study is through the Shari`ah, where law, finance, economics and business form a single dimension only, even though a very significant one. Examination of the issues of this study is undertaken through the literature in the relevant field as well as the author’s personal expertise and working experience with several Islamic banks (IBs) and IFIs for a considerable period of time, in addition to his active involvement with at least two of Islamic Financial Services Providers (IFSPs) in Australia.
Doctor of Philosophy (PhD)

The Australian Accounting Standards Board (AASB) and the International Accounting Standards Board (IASB) state in their objectives that they are committed to producing quality accounting standards in the public interest to enhance the decision usefulness of accounting information. Cooperation between the AASB and IASB began in aid of the development of internationally accepted Australian accounting standards after the issuance of Policy Statement 6, ‘International Harmonisation Policy’, in 1996. The AASB adopted a two-pronged approach to changing Australian accounting standards: it introduced changes in accounting standards for issues not covered in international accounting standards, and also adopted international accounting standards to provide decision-useful information to the users of financial statements. The introduction of new accounting standards and changes to the existing standards affected the financial statements of firms, including Australian banking firms. Firms that are affected by the introduction of new accounting standards or changes in accounting standards are required to provide complete disclosure of both quantitative and qualitative information to improve the economic decision making of the users. However, the concept of users in the conceptual framework is narrowly focused on the information needs of investors as the users of accounting information. Investors rely on the recommendations of financial analysts for investment decisions, and financial analysts value firms by using accounting information as input for valuation models to generate recommendations to buy, sell or hold decisions for investors. The objective of this research is to investigate the impact of changes in accounting policies on the forecasted values of Australian banking firms for the period 1997–2007. The objective is not to predict forecasted share prices accurately, but rather to use forecasted share prices generated through the use of various valuation models used by financial analysts to identify whether changes in accounting policies due to the changes in accounting standards have resulted in decreases in forecasting error.

Electronic Funds Transfer (‘EFT’) as a modern, global consumer payment method continues to expand rapidly by comparison with credit cards and traditional paper-based forms of payment. The core issue addressed in this thesis is a controversial one: the fair allocation of liability between the consumer and financial institution in the event of a disputed or unauthorised EFT transaction. The purpose of this study is considered especially apposite in view of the Australian Securities and Investments Commission’s (‘ASIC’) imminent review of the self-regulating Australian EFT Code of Conduct (‘EFT Code’) and both the increasing incidence of reported unauthorised EFT transactions and in noncompliance by EFT financial institutions with the EFT Code. It is also an important study because of the rapid recent growth in EFT transaction volume and the continued expansion of EFT products and services compared to other payment instruments, which are in a corresponding decline. Moreover, there has been no previous study or review of the current Australian EFT Code, which was revised in 2002. In the EFT payments system, consumers are exposed to risks quite different from those in traditional payments instruments. These include flaws in the various methods employed by financial institutions for the distribution of EFT cards and PINs, problems adducing unequivocal evidence in the event of unauthorised use of the instrument and systemic errors and technical malfunctions in processing EFT transactions. Furthermore, the distinct nature of electronic authentication using an electronic device and secret code makes the general common law principles dealing with handwritten signature authentication in the case of paper instruments (eg, by analogy with a forged cheque) particularly unhelpful. In order to address these controversies, this thesis presents an integrated multi-disciplinary analysis of EFT regulation in Australia in an attempt to identify the efficacy of current EFT regulatory arrangements as well as to appraise the merits of different EFT regulatory options to attain a more optimal and efficient regulatory regime for the future. The adapted multi-disciplines include comparative law method, economic criteria and regulation theory methods, as well as ethical, social and administrative considerations. The two (2) EFT regulations which are the subject of this comparative study are the Australian EFT Code and the US EFT Act. The latter was chosen for comparative purposes as it is a rare example of a formal legislative response to the above core issues and risks, which the EFT system in the USA has in common with Australia. Unlike the US EFT Act, for example, which has a relatively simple and administratively convenient approach to apportioning fault, the self-regulating Australian EFT Code essentially shares the burden of proof between the financial institution and the consumer in most instances. The consequence of the EFT Code’s ambiguous, undefined and multi-layered legal tests and guidelines for determining the allocation of liability to either consumer or financial institution is that it leaves the Australian Banking Industry Ombudsman (‘ABIO’), as the independent and preferred adjudicator of Australian EFT disputes, with the difficult and arbitrary task of hearing contrasting arguments and weighing the inconclusive evidence led by both sides before then seeking to reach a fair and equitable finding on the ‘balance of probabilities’. Indeed, the practical application of the EFT Code is extremely difficult and confusing, as the ABIO regularly observes in its annual reports and is almost always evident in its actual case examples. The task undertaken in this thesis to research and analyse these difficult and complex regulatory issues is both helped and hindered by another important issue: the lack of literature on consumer EFT regulation. Helped, because it represents a unique opportunity to embark upon such a study afresh, and, hindered, because little benefit can be derived from previous studies and hence there are no foundations upon which to build or progress the debate, the research and the analysis. Accordingly, the significant gaps in this area provide a rare occasion to explore these contemporary and contentious issues using multi-disciplinary techniques. As is argued in this thesis, the current regulatory arrangements in Australia are ineffective on several grounds. In particular, in: (i) efficiently settling disputed or unauthorised EFT transactions; (ii) ensuring compliance by financial institutions; and (iii) legal enforcement of its provisions. Ultimately, in consequence of this study, it is concluded that to improve consumer confidence and institutional compliance, as well as to arrest rising fraud and illegality, there is an urgent need for a comprehensive review and reform of EFT regulation in Australia. In order to design and formulate a more efficient or optimal regulatory regime, a more rigorous analysis beyond a straight legal studies approach needs to be undertaken. In this sense, the multi-disciplinary research and analytic approach adapted in this study is an integrated approach with the intention that it will not only drive the debate on an appropriate EFT regulatory framework forward, but ultimately with its 48 findings and 25 specific recommendations, also serve as a workable framework with some actual pragmatic criteria on which to assess different EFT regulatory and policy options.

Four major players, touted as the Big 4, dominate the banking industry in Australia. The National Australia Bank (NAB), Commonwealth Bank of Australia (CBA), Westpac Banking Corporation (WBC) and Australia and New Zealand Banking Group (ANZ) dominate the Australian banking industry. However, their products and services are not largely dissimilar. Therefore it is imperative that they differentiate themselves via their service propositions. Paradoxically however, banks seem to be opting for service models that aim to reduce banker/customer face time so as to free bankers up for new business acquisition. Whilst this is an important activity that banks need to engage in, care needs to be taken not to alienate existing customers in the process. This thesis examines the relationship between the bank, its relationship manager and the end customer, and studies the dynamics within this relationship and the main factors contributing to the success of the said relationship which is critical to business success.

Electronic Funds Transfer (‘EFT’) as a modern, global consumer payment method continues to expand rapidly by comparison with credit cards and traditional paper-based forms of payment. The core issue addressed in this thesis is a controversial one: the fair allocation of liability between the consumer and financial institution in the event of a disputed or unauthorised EFT transaction. The purpose of this study is considered especially apposite in view of the Australian Securities and Investments Commission’s (‘ASIC’) imminent review of the self-regulating Australian EFT Code of Conduct (‘EFT Code’) and both the increasing incidence of reported unauthorised EFT transactions and in noncompliance by EFT financial institutions with the EFT Code. It is also an important study because of the rapid recent growth in EFT transaction volume and the continued expansion of EFT products and services compared to other payment instruments, which are in a corresponding decline. Moreover, there has been no previous study or review of the current Australian EFT Code, which was revised in 2002. In the EFT payments system, consumers are exposed to risks quite different from those in traditional payments instruments. These include flaws in the various methods employed by financial institutions for the distribution of EFT cards and PINs, problems adducing unequivocal evidence in the event of unauthorised use of the instrument and systemic errors and technical malfunctions in processing EFT transactions. Furthermore, the distinct nature of electronic authentication using an electronic device and secret code makes the general common law principles dealing with handwritten signature authentication in the case of paper instruments (eg, by analogy with a forged cheque) particularly unhelpful. In order to address these controversies, this thesis presents an integrated multi-disciplinary analysis of EFT regulation in Australia in an attempt to identify the efficacy of current EFT regulatory arrangements as well as to appraise the merits of different EFT regulatory options to attain a more optimal and efficient regulatory regime for the future. The adapted multi-disciplines include comparative law method, economic criteria and regulation theory methods, as well as ethical, social and administrative considerations. The two (2) EFT regulations which are the subject of this comparative study are the Australian EFT Code and the US EFT Act. The latter was chosen for comparative purposes as it is a rare example of a formal legislative response to the above core issues and risks, which the EFT system in the USA has in common with Australia. Unlike the US EFT Act, for example, which has a relatively simple and administratively convenient approach to apportioning fault, the self-regulating Australian EFT Code essentially shares the burden of proof between the financial institution and the consumer in most instances. The consequence of the EFT Code’s ambiguous, undefined and multi-layered legal tests and guidelines for determining the allocation of liability to either consumer or financial institution is that it leaves the Australian Banking Industry Ombudsman (‘ABIO’), as the independent and preferred adjudicator of Australian EFT disputes, with the difficult and arbitrary task of hearing contrasting arguments and weighing the inconclusive evidence led by both sides before then seeking to reach a fair and equitable finding on the ‘balance of probabilities’. Indeed, the practical application of the EFT Code is extremely difficult and confusing, as the ABIO regularly observes in its annual reports and is almost always evident in its actual case examples. The task undertaken in this thesis to research and analyse these difficult and complex regulatory issues is both helped and hindered by another important issue: the lack of literature on consumer EFT regulation. Helped, because it represents a unique opportunity to embark upon such a study afresh, and, hindered, because little benefit can be derived from previous studies and hence there are no foundations upon which to build or progress the debate, the research and the analysis. Accordingly, the significant gaps in this area provide a rare occasion to explore these contemporary and contentious issues using multi-disciplinary techniques. As is argued in this thesis, the current regulatory arrangements in Australia are ineffective on several grounds. In particular, in: (i) efficiently settling disputed or unauthorised EFT transactions; (ii) ensuring compliance by financial institutions; and (iii) legal enforcement of its provisions. Ultimately, in consequence of this study, it is concluded that to improve consumer confidence and institutional compliance, as well as to arrest rising fraud and illegality, there is an urgent need for a comprehensive review and reform of EFT regulation in Australia. In order to design and formulate a more efficient or optimal regulatory regime, a more rigorous analysis beyond a straight legal studies approach needs to be undertaken. In this sense, the multi-disciplinary research and analytic approach adapted in this study is an integrated approach with the intention that it will not only drive the debate on an appropriate EFT regulatory framework forward, but ultimately with its 48 findings and 25 specific recommendations, also serve as a workable framework with some actual pragmatic criteria on which to assess different EFT regulatory and policy options.

The uncertainty in financial markets due to the global financial crisis highlights the importance of proper prudential and regulatory practices in commercial banks, and the economic and social costs that can be incurred if risk is not adequately identified and managed. To manage risk, the global community is adopting the third generation of liquidity and capital requirements developed by the Basel Committee on Banking (the Basel III standards). There is no published study focusing on the implementation of Basel III in the Australian banking system. To fill this gap, this study develops a bank asset and liability management model using goal programming for one large Australian bank, to examine the implications of a progressive move to Basel III on key financial variables – net interest income (NII), return on equity (ROE) and return on assets (ROA) – to undertake a preliminary stress testing analysis of the bank after Basel III and to consider some of the governance and policy response issues involved. The `modelling is used to investigate the impact of progressively moving to Basel III from a Basel II base case, assuming that the bank maintains current balance sheet trends, practices and corporate governance settings out to 2019. The bank asset and liability goal programming model was also used to examine the implications of two stress scenarios: the first involves an increase of 5% in net cash outflow (NCO) and a decrease in interest income of 5%, and the second involves an increase of 10% in net cash outflow and a decrease in interest income of 10%. Finally, this thesis examines possible policy responses available to the banks, guided by corporate governance, to offset some of the effects of implementing the Basel III requirements.

Using 1980 - 2012 annual data, the study empirically investigates the dynamic relationship between financial development and economic growth in three developing countries (South Africa, Brazil and Kenya) and three developed countries (United States of America, United Kingdom and Australia). The study was motivated by the current debate regarding the role of financial development in the economic growth process, and their causal relationship. The debate centres on whether financial development impacts positively or negatively on economic growth and whether it Granger-causes economic growth or vice versa. To this end, two models have been used. In Model 1 the impact of bank- and market-based financial development on economic growth is examined, while in Model 2 it is the causality between the two that is explored. Using the autoregressive distributed lag (ARDL) bounds testing approach to cointegration and error-correction based causality test, the results were found to differ from country to country and over time. These results were also found to be sensitive to the financial development proxy used. Based on Model 1, the study found that the impact of bank-based financial development on economic growth is positive in South Africa and the USA, but negative in the U.K – and neither positive nor negative in Kenya. Elsewhere the results were inconclusive. Market-based financial development was found to impact positively in Kenya, USA and the UK but not in the remaining countries. Based on Model 2, the study found that bank-based financial development Granger-causes economic growth in the UK, while in Brazil they Granger-cause each other. However, in South Africa, Kenya and USA no causal relationship was found. In Australia the results were inconclusive. The study also found that in the short run, market-based financial development Granger-causes economic growth in the USA but that in South Africa and Brazil, the reverse applies. On the other hand bidirectional causality was found to prevail in Kenya in the same period.
Economics
DCOM (Economics)