Articles de revues sur le sujet « Nationalized commercial banks »

This study revisited an alternative profit efficiency function specified by Berger & Mester, (1997) and we applied Battese & Coelli, (1995) inefficiency model as a unified and consistent framework in exploring the determinants of important factors causing profit efficiency differential on banking industry in Bangladesh. Using stochastic frontier technique we estimated bank specific profit efficiency for the period 2000 to 2007. This study attempted to examine the changes in the profit efficiency in accordance with NBs (Nationalized Commercial Banks), ISBs (Islamic Banks), FBs (Foreign Banks) and PBs (Private Banks) and significant variations of efficiencies across different kinds of banks in time periods. We found that the profit inefficiency has declined over the reference period and Translog Production Function is more preferable than Cobb-Douglas Production Function. Our results showed that Nationalized Commercial Banks were significantly inefficient and on the contrary ISBs, FBs, and PBs were efficient in producing profit and noteworthy. The estimated year wise average efficiencies of the sample banks from the profit efficiency model was 0.664 while group wise average profit efficiency was 0,639. Dhaka Bank is highly efficient with score 0.89 and AB Bank was found lowest efficient with score 0,35 according to the sample data.

The main aim of the study is to evaluate and compare the performance of public and private banks in Bangladesh. Performance measured in terms of bank’s profitability always remains the focal point of all the banking activities. Data collected from publically and privately owned and managed banks in Bangladesh revealed that profitability of both banks was not satisfactory though private sector bank was more profitable than public sector bank during the period of this study.

Financial system reforms in recent decades have significantly reshaped the Indian commercial banking system. Despite substantial changes in the ownership and structure of Indian Banking system, fewer reliable studies have been conducted to empirically investigate the effect of ownership on various performance dimensions. Drawing upon experiences of Indian commercial banks during 2002-2009, this study analyzes how state-owned, nationalized and domestic private banks are behind foreign banks, using data envelopment analysis together with three supplementary measures of performance. The findings suggest that the performance of domestic banks has not yet reached the level of foreign banks in terms of both cost and revenue efficiencies. Surprisingly, domestic private banks are the least efficient in the market. Though foreign banks outperform domestic counterparts in multiple aspects, their contribution for spreading banking services beyond metropolitan cities by establishing new branches is trivial and thus they make the least contribution to countrys financial deepening.

In this age of innovation and globalization, interest in research on measuring and analyzing intellectual capital (IC) and determining its impact on business performance is on the rise. This study is intended to review the literature concerning the effects of implementing the Balance Scorecard (BSC) on the organizational performance of banks, with the Intellectual Capital (IC) enhancement being the mediator. Based on the literature a new comprehensive performance measurement framework for banks has been proposed. This framework can be validated through further research by integrating the interaction between BSC and IC components in the context of Bangladeshi banks by examining different banking environment i.e. nationalized, private commercial, foreign commercial and Islamic banks, as the literature shows strong deviation in measurement models depending on the nature of business.Journal of Business and Technology (Dhaka) Vol.10(2) 2015; 81-95

Two alternative estimation models, i.e., a translog cost function and data envelopment analysis (DEA) based on a cost model are compared and contrasted in revealing scale economies in the Indian commercial banking sector. The empirical results indicate that while the translog cost model exhibits increasing returns to scale for all the ownership groups, the DEA model reveals economies of scale only for foreign banks, diseconomies of scale for nationalized banks, and both economies and diseconomies of scale for private banks. The divergence of the results obtained from these two estimation models should concern model builders. From an empirical perspective the definition of scale economies through a constant input mix is very restrictive. The DEA cost model is much more flexible in this respect: It neither requires the restrictive assumptions that the unit factor prices are always available with certainty, nor that these prices are exogenous to the firms. However, the very volatile nature of the banking industry might question the validity of the empirical estimates in this deterministic setting. Therefore, further research is required to examine the bank performance behavior using both SFA and chance constrained DEA for the comparison in a stochastic setting.

Businesses make investments in e-business and the technology that supports it. Applications for e-business, like supply chain management and customer relationship management, boost innovative product and service offers, strong customer relationships, and transaction efficiency and scope economies. Companies find it challenging to turn these advantages into revenues or economic value, though. Many enterprises that have started online have failed to generate profits. According to a 2001 AMR Research Inc. survey, businesses would continue to spend more on e- business even in a recession. At best, though, these investments have yielded a mediocre return. Conventional Banking To conduct standard banking functions including cash withdrawals, fund transfers, and account inquiries, clients must physically visit the bank's branch. However, clients using e-banking can complete these transactions 24/7 from the comfort of their homes or workplaces using desktops or laptops and electronic media. We call this banking—anytime, anyplace. Consumers don't need to wait in line, deal with tellers, deal with constrained banking hours—all they need to do is visit the bank's website to examine their account details and do transactions as needed. The Banking System in India Scheduled and non-scheduled banks were distinguished under the Reserve Bank of India Act, 1934. The Second Schedule of the RBI Act, 1934 lists scheduled banks, which include state co-ops, regional rural banks, and commercial banks (both foreign and Indian). The banks not listed in this schedule are considered non-scheduled. Three types of banks comprise India's organized banking system: co-ops, regional rural banks, and commercial banks. The Reserve Bank of India, the nation's highest monetary and financial body, is in charge of managing the banking sector. Banks for commerce, which have been in place for many years encourage urban savings and make them available to trading and industrial organizations for working capital needs. Commercial banks were divided into public sector banks, sometimes known as nationalized banks, and private sector banks after 1969.

Historically, banks have tended to prefer litigation over arbitration for their disputes. However, in recent years, banks have increasingly been using international arbitration instead, particularly when doing transactions in Asia and in emerging markets. The 2018 Queen Mary International Arbitration Survey also concluded that financial institutions, including banks, and their counsel are ‘contemplating arbitration with much greater interest than ever before’. In addition to using international commercial arbitration more often, banks have increasing sought to benefit from treaty-based international investment arbitration. The protections afforded in investment treaties mitigate some of the key risks banks face when investing abroad, such as having their investment nationalized or being subjected to unfair investigations. This article focuses on banks as claimants in treaty-based investment arbitrations, a subject not addressed in commentaries. It examines the publicly available investment arbitration awards in cases brought by banks against States and sets out to identify some key trends and themes. banks, investment arbitration, jurisdiction, investor, investment, fair and equitable treatment, expropriation

The banking system is facing challenges with stiff competition and advancement of technology. It becomes imperative for service providers to meet or exceed the target customers' satisfaction with quality of services expected by them. Hence, the present study attempted to study customers' perception of quality of services (both transactions-based and IT-enabled) in terms of its constituent factors and IT adoption in public, private, and foreign commercial banks in this E-age. The present investigation was planned with the objective to assess the extent of use of services especially the IT-enabled services in these banks and to analyze the constituent factors affecting customer satisfaction with the quality of services. The study area was Dhaka, the capital city of Bangladesh. Simple random sampling was used for selection of sample branches. The study reveals that check deposition and check clearance are the most popular banking <p>services among the customers of all sample banks. The customers of nationalized banks were not satisfied with the employee behavior and infrastructure while respondents of private and foreign commercial banks were not satisfied with high charges, accessibility and communication. A small number of respondents were using IT-enabled services other than ATM, and a few respondents made complain against their respective banks. Keywords : Transaction-based banking services, IT-enabled banking services, Customer satisfaction, Service quality</p>

At present corporate social responsibility (CSR) has become an important tool due to contribute the sustainable economic development by ensuring the different benefits for the stakeholders. Corporate social responsibility (CSR) expenditures are extending accepted issue for economic development in competitive business world. The study examines the corporate social responsibility (CSR) expenditures and its relationship with financial performance variables of the sample banks between the years 2012 to 2016 with the use of secondary data. Findings from the analysis display that the sample banks have contributed in the different activities under corporate social responsibility (CSR) program but the contributions were not sufficient over the study period. The study revealed that the corporate social responsibility (CSR) expenditures of the sample banks have shown increasing and decreasing tendency during the study period. The study also revealed that there is no significant influence of financial performance variables on corporate social responsibility (CSR) expenditures of the sample banks over the study period.

Purpose: The aim of this study is to evaluate the bailout strategies for sound liquidity management of Bangladeshi Nationalized Commercial Banks. Method: The researcher has selected six banks purposively as sample. A survey was conducted to gather opinions from 120 officials working in the treasury departments of these selected banks. The survey utilized a questionnaire and employed a direct approach. Subsequently, the collected data underwent analysis using common size statement analysis methodology. The survey encompassed various regulatory decisions pertaining to liquidity management. Result and conclusion: The results indicate that within the scope of 07 distinct Acts, Laws, and Regulations, there exist 19 prescribed rules and limits. Among these, 07 rules adhere to the established standards, while 03 exceed the prescribed rules and limits, and 09 fall short of meeting the specified limits. Implication of the research: The evaluation of bailout strategies offers valuable insights into enhancing liquidity management practices, potentially bolstering the stability of the banking sector. Besides, the identification of discrepancies between regulatory requirements and actual compliance underscores the need for stringent oversight and enforcement mechanisms. Lastly, by highlighting areas of non-compliance, the researcher recommends that Bangladesh Bank must critically review and monitor the rules regularly. Originality: The originality of this research lies in its pioneering exploration of bailout strategies, offering novel insights into the regulatory landscape and practical implications for effective liquidity risk mitigation and financial stability in Bangladesh's banking sector.

Sound financial health of a bank is the guarantee not only to its depositors but is equally significant for the shareholders, employees and whole economy as well. As sequel to this maxim, efforts have been made from time to time to measure the financial position of each bank and manage it efficiently and effectively.Indian banking sector widely includes commercial, nationalized, co-operative, private and international banks in its fold. In the present study an attempt is made to evaluate the financial performance of three major commercial banks (IOB, Canara Bank and Syndicate Bank) using CAMELS Rating Model. CAMELS rating model is basically an approach widely used to measure the performance of banking unit inside and outside India. This model measures the performance of banks from all important parameters like Capital adequacy, Asset quality, Management efficiency, Earning quality, Liquidity and sensitivity to market. The study is based on secondary data drawn from the annual reports. For the purpose of evaluation the data’s of five years (2011-2016) before demonetization are analyzed by calculating the 17 ratios related to CAMELS rating model. It is found out that according to Basel Norm the overall state of capital adequacy of all the three banks are satisfactory. As far as loan portfolio is concern, the overall state of asset quality and management efficiency are satisfactory, whereas the earning capacity of the banks is not and the liquidity is also not satisfactory. The high level of NPAs and sluggishness in the domestic growth, slow recovery in the global economy and the continuing uncertainty in the global market leading to lower exports and imports are one of the main reasons for the low earning capacity of banks along with these reasons RBI’s new rules to make higher provisioning for substandard assets also affected the earning capacity of all the three banks. Based on the evaluations all the three commercial banks should improve its earning capacity and the liquidity position to perform efficiently and effectively.

The instability of the banking sector has become the subject of wider scientific research during the global financial crisis. The financial crisis of the first decade of the twenty-first century began in the U.S. subprime mortgage market and quickly spread to the whole banking sector in the United States as well as in many countries of the global economy. Among five major American investment banks - Lehman Brothers went bankrupt, Bear Stearns and Merrill Lynch were taken over by other banks, and Goldman Sachs and Morgan Stanley were transformed into commercial banks, which were covered by the supervision and regulations of the central bank - the Federal Reserve System. The consequences of the global financial crisis also affected British banks, including The Royal Bank of Scotland, Lloyds Bank, Halifax, Abbey Bank, Barclays Bank and NBC Bank. In Iceland, during the global financial crisis which affected the Icelandic banking sector, three largest banks: Glitnir Bank, Landsbanki and Kauphting were nationalized, which means that the control was taken over by their government. It has caused, that reflections and scientific research on financial stability were replaced by the study of instability in particular in relation to the banking sector. The main aim of the study is to identify the general framework of the response system of central banks on the phenomenon of banking sector instability, in the context of preventing it in a long term. Current - the traditional system proved to be ineffective, because it did not prevent the spread of the factors that led to the destabilization of the banking market

Satisfaction of employees and commitment in Nationalized Commercial Banks (NCBs) is of highest concern due to the nature of organizations in Bangladesh. This study directed to assess the influence of employee satisfaction of work on three levels of firms’ commitment such as affective, continuance and normative commitment within NCBs in Bangladesh. The cross-sectional research design is followed in this investigation. Quantitative survey research was carried out and the sample of 100 employees filled up the questionnaire from four NCBs in Khulna City. The outcomes revealed that the employees’ satisfaction is completely related with Affective Commitment (AC). Furthermore, the Continuance Commitment (CC) of employees is significantly predicted by employee satisfaction at the workplace. Finally, the outcomes also show how the Normative Commitment (NC) of employees is positively impacted by their work satisfaction. Owing to research design, caution was taken in making the results’ generalization. The present study might be of interest and practice for banks in formulating strategic Human Resource Management Policies. Because it considers how managers or bosses, or experts understand their employees’ sense of attachment toward a particular organization. This study also highlighted the bank management practices’ nature and significance for the sustainability of the banking sector.

Purpose – The purpose of this paper is to provide an analysis on the relationship between information technology (IT) adoption and its usage and firm performance (banking and software firm) in India. Firm performance was measured with the help of three important variables: efficiency, effectiveness and productivity. Each one of the above has been described with a set of pretested questionnaires. Banks in India, in particular are geared for comprehensive banking solutions with extensive branch networks. Result from statistical analysis was validated with that achieved from ANN modeling. Design/methodology/approach – Survey instrument was pilot tested. The pilot survey was administered to 20 randomly selected Indian service firms, whose Standard Industrial Classification codes were 6,021 (nationalized commercial Banks) and 7,371 (software firms). A 50 percent response rate was received. Internal reliability using Cronbach’s α was carried out for the entire set of responses from the pilot study. In addition, qualitative follow up from respondents was done. Unreliable items were deleted and modifications wherever necessary were made. Findings – The research finds two important results with respect to IT adoption and firm performance. The first result is that service firms who implemented IT tools and techniques early achieved more turnover thereby greater market share from innovation/adoption (world-first and, to some extent India-first). These firms are able to better commercialize their service even if their most important innovations/adoptions supported by vendor’s to some extent. The second result is that service firms, which introduce new services, even if the service is already on the national or international front, derived more commercial sales from innovation, thus achieving more firm performance. Therefore, late followers (firm-first) would have higher sales from innovation by introducing services with high original content. Originality/value – Performance is measured due to IT adoption.

The importance of the rural banking and microfinance in the economic development of a country cannot be overlooked. As Mahatma Gandhi pointed out “Real India Lives in Villages’, and village economy is the backbone of Indian economy the existing extensive formal banking structure is still not sufficient to meet the growing demand of rural credit. Financial inclusion is delivery of financial services more especially the banking services at an affordable cost to vast sections of disadvantaged and low-income groups. Financial inclusion aims at drawing the “Unbanked” population into the formal financial system so that they have the opportunity to access financial services ranging from savings, payments, and transfers to credit and insurance. Major commercial banks in India have been nationalized with the objective of establishing a strong financial structure and therby paying the path for the economic and social development of the nation. It is now widely acknowldeged that financial exclusion leads to non-accessibility, non-affordability and non-availability of financial products. Limited access to funds in an underdeveloped financial system restricts the availability of their own funds to individuals and also leads to high-cost credit from informal sources such as moneylenders. Due to lack of access to a bank account and remittance facilities, the individual pays higher charges for basic financial transactions. Absence of bank account also leads to security threat and loss of interest by holding cash. All these impose real costs on individuals. Prolonged and persistent deprivation of banking services to a large segment of the population leads to a decline in investment and has the potential to fuel social tensions causing social exclusion. Thus, financial inclusion is an explicit strategy for accelerated economic growth and is considered to be critical for achieving inclusive growth in the country.

The present study examined the performance of public sector commercial banks in mutual fund industry in terms of profitability for the period from March 2007 to March 2016. Banks, which were used as an agent by the government to bring changes in the economic scenario of the country and for which most of the larger banks were nationalised in a phased manner, were not performing well during the 1980s and their profits and deposits started to decline. As a result, the Government of India amended the Banking Regulation Act in 1984, to give a wider scope to the banks in terms of business. Many public sector banks started their own sponsored mutual fund companies after 1987 as they had some pre-existing advantages. The data relating to the present study has been collected from corporate Capitaline Plus database and also from the various publications made by the Reserve Bank of India and others from time to time. The data has been analysed by using various profitability ratios and ratio of mutual fund profit to bank profit to reach the conclusion. The study disclosed that the private banks performed better than the public sector commercial banks during the study period. JEL Classification: G21, L25, M13

There are various financial tools and techniques to measure the performance of the banks, one of the most important one being the CAMEL model which lays emphasis on all the aspects of the performance measurement. The present study analyses the performance of selected nationalized banks in India.

This study contributes to the bank efficiency literature by estimating the technical efficiency, pure efficiency, and scale efficiency of banks in four different ownership groups in India from 008-09 to 019-20, utilizing the DEA method and three alternative approaches to choosing inputs and outputs of banks-intermediation approach, value-added approach, and operating approach. It also uses the Tobit estimation procedure to identify the factors determining the variations in the technical efficiency of banks. Results indicate a high degree of inefficiency of several banks during the study period, and there is greater scope for improving their performances. Sizable scale inefficiency exists, and banks are likely to lose sizable output. The results also indicate that banks with a larger capital adequacy ratio, young banks, larger banks, or more profitable banks are more efficient. Foreign banks and nationalized banks are more efficient than private domestic banks. We hope that the findings of this study will be useful to international agencies and other stakeholders in evaluating and improving the performance of Indian banks.

PurposeIntellectual capital (IC) and financial performance is now a very contemporary issue in the banking sector. The purpose of this study is to investigate empirically the impact of IC on financial performance of all the listed commercial banks of Bangladesh.Design/methodology/approachBangladesh Bank database and financial statement of the listed commercial banks of Bangladesh for the period of 2014–2018 have been used to collect data. Value added intellectual coefficient (VAICTM) methods have been used for measuring the performance of banks. VAICTM determined IC and its three major components like structural, human and capital employed.FindingsThe results suggest that human capital efficiency (HCE) and capital employed efficiency (CEE) have statistically significant relationships with bank performance, but when VAICTM is divided then structural capital efficiency (SCE) does not have a significant relationship with bank performance.Research limitations/implicationsThe study uses only listed banks, but it does not include all the commercial banks specially nationalized commercial banks.Practical implicationsThe findings allowed banks to focus more on human capital (HC) and structural capital, because in the present world, HC is considered one of the key factors for the success in business. This study also provides an awareness on how good IC of the banking companies will bring more assistance to a better life of a society.Originality/valueThis is one of the very few studies which examine the impact of IC on bank financial performance in Bangladesh.

This study has been designed for examining the effectiveness of liquidity management through the relative standing of ROE and ROCE of Nationalized Commercial Banks in Bangladesh for the duration of 2008–2018. Six NCBs are selected purposively as sample. The study relies on a balanced panel data set of 66 observations which are gathered from the annual reports of banks and analyzed by random effects regression model. However, the research only examined a few variables. The empirical results reveal that the selected NCBs have been portraying better standing in case of ROE than ROCE in effective liquidity management. The value of R2 of ROE is 75.25%; it signifies that the explanatory measures could clarify 75.25% of the variations in ROE. Among the liquidity measures, Assets/Shareholders Equity has highly significant negative effect; Tier 1 Capital/Risk Weighted Assets has highly significant positive effect; Deposits/Assets have some significant positive and Bank Size in terms of Deposits has some significant negative effect on ROE of the selected NCBs.

This study has been designed for examining the effectiveness of liquidity management through the relative standing of ROE and ROCE of Nationalized Commercial Banks in Bangladesh for the duration of 2008–2018. Six NCBs are selected purposively as sample. The study relies on a balanced panel data set of 66 observations which are gathered from the annual reports of banks and analyzed by random effects regression model. However, the research only examined a few variables. The empirical results reveal that the selected NCBs have been portraying better standing in case of ROE than ROCE in effective liquidity management. The value of R2 of ROE is 75.25%; it signifies that the explanatory measures could clarify 75.25% of the variations in ROE. Among the liquidity measures, Assets/Shareholders Equity has highly significant negative effect; Tier 1 Capital/Risk Weighted Assets has highly significant positive effect; Deposits/Assets have some significant positive and Bank Size in terms of Deposits has some significant negative effect on ROE of the selected NCBs.

Effect of the demonetization in Novetmber 2016 was seen in the month December 2017 with the value of e-transactions in India doubling from Rs.0.10 trillion to Rs.0.20 trillion. Thereafter the value quadrupled in the next month, January 2017 to Rs.0.48 trillion. Later on the value seems to have stabilized around Rs.0.40 trillion. It is heartening to note that all the instruments, RTGS, NEFT, IMPS, USSD, Cards, Mobile banking etc. have fared very well in providing a good platform for executing the transactions digitally. Thus, we can see a clear correlation between demonetization and e-monetization. This study was an investigation into the e-banking practices in nationalized and private banks in the State of Maharashtra in the light of the banking sector in India undergoing a phenomenal change thanks to the November, 2016 demonetization move by the Government. Primary data was collected from bank customers. The population of bank customers in Maharashtra is expected to be quite large (say more than 20000) in which case a sample size of 500 respondents was fixed. This article discusses that e-banking is finding favors with the younger generation and if the perceived benefits from e-banking are popularized and publicized well then the response to e-banking can be expected to be much better.

India’s non-banking financial institutions (NBFIs), broadly constituting the less-regulated shadow banking sector, have been plagued with scams, triggering a domino effect in the Indian money market. Major corporate governance issues were highlighted in NBFIs with the unfurling of the ILF&S fraud; it virtually created a sub-prime crisis. In such a scenario, where the shadow banking sector was subject to change in regulations to ensure vigilance, corporate governance lapses had again led to the meltdown of Kapil Wadhawan led Dewan Housing Finance Limited (DHFL). Registering a net profit growth of 25% in the third quarter of financial year 2017, DHFL was one of India’s leading housing finance companies with a value of whopping ₹1.01 trillion as its asset under management (AUM). The company had nose-dived from its coveted position, suffering a loss of ₹22.23 million for the last quarter of the financial year 2018–2019. The company’s credit ratings of commercial papers and non-convertible debentures were downgraded; non-payment of interests led to enforcement of resolution plan, with the board of directors acceding to nationalized banks. The company’s reputation had crashed with its share prices, amidst allegations of lookout notice issued for its promoters for siphoning funds through shell companies. The case describes the oversights and negligence of DHFL in terms of corporate governance practices in the context of the NBFC (non-banking financial company) sector. The jury is out to evaluate whether Wadhawan had followed the rules of corporate governance in letter and spirit, or the tightening noose of regulations and market sentiments around the ‘shadow banking’ sector of India spelt doom for DHFL.

There is an old Danish fable that says that the Devil was watching when God created the earth, and that, as the creation progressed, he became increasingly agitated over the wondrous achievements he was made to witness. At the end of it all, the Devil turned to God, and said, ‘Now, watch this.’ He created Iceland. It’s a vision of the country that resembles my own. I have always thought of Iceland as the island apart. The place that came last in the earth’s construction, whoever the engineer, and so remains forever distant. Perhaps that’s because, for me, Iceland is a home far from home. It is the country that I am from, and the place to which I am always tending—in my reading, my travels, and my thoughts. But since we left when I was ten, I am only ever in Iceland for mere glimpses of the Devil’s work, and always leave wanting more, some kind of deeper involvement. Perhaps all of his temptations are like that. Iceland’s is an inverted landscape, stuck like a plug on the roof of the Earth, revealing all the violence and destruction of the layers beneath. The island expands as the tectonic plates beneath it move. It grows by ten centimetres a year, but in two different directions—one towards the States, and the other towards Europe. I have noticed something similar happening to me. Each year, the fissure is a little wider. I come to be more like a visitor, and less like the one returning to his birthplace. I last visited in February just gone, to see whether Iceland was still drifting away from me and, indeed, from the rest of the world. I was doing research in Germany, and set aside an extra week for Reykjavík, to visit friends and family, and to see whether things were really as bad as they appeared to be from Brisbane, where I have lived for most of my life. I had read countless bleak reports of financial ruin and social unrest, and yet I couldn’t suppress the thought that Iceland was probably just being Iceland. The same country that had fought three wars over cod; that offered asylum to Bobby Fischer when no-one else would take him; and that allowed Yoko Ono to occupy a small island near Reykjavík with a peace sculpture made of light. Wasn’t it always the country stuck out on its own, with a people who claimed their independent spirit, and self-reliance, as their most-prized values? No doubt, things were bad. But did Iceland really mean to tie itself closer to Europe as a way out of the economic crisis? And what would this mean for its much-cherished sense of apartness? I spent a week of clear, cold days talking to those who made up my Iceland. They all told me what I most wanted to hear—that nothing much had changed since the financial collapse in 2008. Yes, the value of the currency had halved, and this made it harder to travel abroad. Yes, there was some unemployment now, whereas before there had been none. And, certainly, those who had over-extended on their mortgages were struggling to keep their homes. But wasn’t this the case everywhere? If it wasn’t for Icesave, they said, no-one would spare a thought for Iceland. They were referring to the disastrous internet bank, a wing of the National Bank of Iceland, which had captured and then lost billions in British and Dutch savings. The result was an earthquake in the nation’s financial sector, which in recent years had come to challenge fishing and hot springs as the nation’s chief source of wealth. In a couple of months in late 2008, this sector all but disappeared, or was nationalised as part of the Icelandic government’s scrambling efforts to salvage the economy. Meanwhile, the British and Dutch governments insisted on their citizens’ interests, and issued such a wealth of abuse towards Iceland that the country must have wondered whether it wasn’t still seen, in some quarters, as the Devil’s work. At one point, the National Bank—my bank in Iceland—was even listed by the British as a terrorist organization. I asked whether people were angry with the entrepreneurs who caused all this trouble, the bankers behind Icesave, and so on. The reply was that they were all still in London. ‘They wouldn’t dare show their faces in Reykjavík.’ Well, that was new, I thought. It sounded like a different kind of anger, much more bitter than the usual, fisherman’s jealous awareness of his neighbours’ harvests. Different, too, from the gossip, a national addiction which nevertheless always struck me as being rather homely and forgiving. In Iceland, just about everyone is related, and the thirty or so bankers who have caused the nation’s bankruptcy are well-known to all. But somehow they have gone too far, and their exile is suspended only by their appearances in the newspapers, the law courts, or on the satirical T-shirts sold in main street Laugavegur. There, too, you saw the other side of the currency collapse. The place was buzzing with tourists, unusual at this dark time of year. Iceland was half-price, they had been told, and it was true—anything made locally was affordable, for so long unthinkable in Iceland. This was a country that had always prided itself on being hopelessly expensive. So perhaps what was being lost in the local value of the economy would be recouped through the waves of extra tourists? Certainly, the sudden cheapness of Iceland had affected my decision to come, and to stay in a hotel downtown rather than with friends. On my last full day, a Saturday, I joined my namesake Kári for a drive into the country. For a while, our conversation was taken up with the crisis: the President, Ólafur Ragnar Grímsson, had recently declined to sign a bill that ensured that Iceland repaid its debts to the British and Dutch governments. His refusal meant a referendum on the bill in the coming March. No-one doubted that the nation would say no. The terms were unfair. And yet it was felt that Iceland’s entry into the EU, and its adoption of the Euro in place of the failed krónur, were conditional on its acceptance of the blame apportioned by international investors, and Britain in particular. Britain, one recalled, was the enemy in the Cod Wars, when Iceland had last entered the international press. Iceland had won that war. Why not this one, as well? That Iceland should suddenly need the forgiveness and assistance of its neighbours was no surprise to them. The Danes and others had long been warning Icelandic bankers that the finance sector was massively over-leveraged and bound for failure at the first sign of trouble in the international economy. I remember being in Iceland at the time of these warnings, in May 2007. It was Eurovision Song Contest month, and there was great local consternation at Iceland’s dismal showing that year. Amid the outpouring of Eurovision grief, and accusations against the rest of Europe that it was block-voting small countries like Iceland out of the contest, the dire economic warnings from the Danes seemed small news. ‘They just didn’t like the útrásarvíkingar,’ said Kári. That is, the Danes were simply upset that their former colonial children had produced offspring of their own who were capable of taking over shops, football clubs, and even banks in main streets of Copenhagen, Amsterdam and London. With interests as glamorous as West Ham United, Hamleys, and Karen Millen, it is not surprising that the útrásarvíkingar, or ‘Viking raiders’, were fast attaining the status of national heroes. Today, it’s a term of abuse rather than pride. The entrepreneurs are exiled in the countries they once sought to raid, and the modern Viking achievement, rather like the one a thousand years before, is a victim of negative press. All that raiding suddenly seems vain and greedy, and the ships that bore the raiders—private jets that for a while were a common sight over the skies of Reykjavík—have found new homes in foreign lands. The Danes were right about the Icelandic economy, just as they’d been right about the Devil’s landscaping efforts. But hundreds of years of colonial rule and only six decades of independence made it difficult for the Icelanders to listen. To curtail the flight of the new Vikings went against the Icelandic project, which from the very beginning was about independence. A thousand years before, in the 870s, Iceland had been a refuge. The medieval stories—known collectively as the sagas—tell us that the island was settled by Norwegian chieftains who were driven out of the fjordlands of their ancestors by the ruthless King Harald the Fair-Haired, who demanded total control of Norway. They refused to humble themselves before the king, and instead took the risk of a new life on a remote, inhospitable island. Icelandic independence, which was lost in the 1260s, was only regained in full in 1944, after Denmark had fallen under German occupation. Ten years later, with the war over and Iceland in the full stride of its independence, Denmark began returning the medieval Icelandic manuscripts that it had acquired during the colonial era. At that point, says the common wisdom, Icelanders forgave the Danes for centuries of poor governance. Although the strict commercial laws of the colonial period had made it all but impossible for Icelanders to rise out of economic hardship, the Danes had, at least, given the sagas back. National sovereignty was returned, and so too the literature that dated back to the time the country had last stood on its own. But, most powerfully, being Icelandic meant being independent of one’s immediate neighbours. Halldór Laxness, the nation’s Nobel Laureate, would satirize this national characteristic in his most enduring masterpiece, Sjálfstætt fólk, or Independent People. It is also what the dominant political party of the independence period, Sjálfstæðisflokkurinn, The Independence Party, has long treasured as a political ideal. To be Icelandic means being free of interference. And in a country of independent people, who would want to stop the bankers on their raids into Europe? Or, for that matter, who was now going to admit that it was time to join Europe instead of emphasizing one’s apartness from it? Kári and I turned off the south road out of Reykjavík and climbed into the heath. From here, the wounds of the country’s geological past still dominated the surface of the land. Little wonder that Jules Verne claimed that the journey to the centre of the world began on Snæfellsnes, a peninsula of volcanoes, lava, and ice caps on a long arm of land that extends desperately from the west of the island, as if forever in hope of reaching America, or at the very least Greenland. It was from Snæfellsnes that Eirík the Red began his Viking voyages westwards, and from where his famous son Leif would reach Vínland, the Land of Vines, most probably Newfoundland. Eight hundred years later, during the worst of the nation’s hardships—when the famines and natural disasters of the late eighteenth century reduced the nation almost to extinction—thousands of Icelanders followed in Leif’s footsteps, across the ‘whale road’, as the Vikings called it, to Canada, and mainly Winnipeg, where they recreated Iceland in an environment arguably even more hostile than the one they’d left. At least there weren’t any volcanoes in Winnipeg. In Iceland, you could never escape the feeling that the world was still evolving, and that the Devil’s work was ongoing. Even the national Assembly was established on one of the island’s most visible outward signs of the deep rift beneath—where a lake had cracked off the heath around it, which now surrounded it as a scar-scape of broken rocks and torn cliffs. The Almannagjá, or People’s Gorge, which is the most dramatic part of the rift, stands, or rather falls apart, as the ultimate symbol of Icelandic national unity. That is Iceland, an island on the edge of Europe, and forever on the edge of itself, too, a place where unity is defined by constant points of separation, not only in the landscape as it crunches itself apart and pushes through at the weak points, but also in a persistently small social world—the population is only 320,000—that is so closely related that it has had little choice but to emphasise the differences that do exist. After a slow drive through the low hills near Thingvellir, we reached the national park, and followed the dirt roads down to the lake. It’s an exclusive place for summerhouses, many of which now seem to stand as reminders of the excesses of the past ten years: the haphazardly-constructed huts that once made the summerhouse experience a bit of an adventure were replaced by two-storey buildings with satellite dishes, spa baths, and the ubiquitous black Range Rovers parked outside—the latter are now known as ‘Game Overs’. Like so much that has been sold off to pay the debts, the luxury houses seem ‘very 2007,’ the local term for anything unsustainable. But even the opulent summerhouses of the Viking raiders don’t diminish the landscape of Thingvellir, and a lake that was frozen from the shore to about fifty metres out. At the shoreline, lapping water had crystallized into blue, translucent ice-waves that formed in lines of dark and light water. Then we left the black beach for the site of the old Assembly. It was a place that had witnessed many encounters, not least the love matches that were formed when young Icelanders returned from their Viking raids and visits to the courts of Scandinavia, Scotland, Ireland, and England. On this particular day, though, the site was occupied by only five Dutchmen in bright, orange coats. They were throwing stones into Öxará, the river that runs off the heath into the Thingvellir lake, and looked up guiltily as we passed. I’m not sure what they felt bad about—throwing stones in the river was surely the most natural thing to do. On my last night, I barely slept. The Saturday night street noise was too much, and my thoughts were taken with the ever-apart Iceland, and with the anticipation of my returning to Brisbane the next day. Reykjavík the party town certainly hadn’t changed with the financial crisis, and nor had my mixed feelings about living so far away. The broken glass and obscenities of a night out didn’t ease until 5am, when it was time for me to board the Flybus to Keflavík Airport. I made my way through the screams and drunken stumblers, and into the quiet of the dark bus, where, in the back, I could just make out the five Dutchmen who, the day before, Kári and I had seen at Thingvellir, and who were now fast asleep and emitting a perfume of vodka and tobacco smoke that made it all the way to the front. It had all seemed too familiar not to be true—the relentless Icelandic optimism around its independence, the sense that it would always be an up-and-down sort of a place anyway, and the jagged volcanoes and lava fields that formed the distant shadows of the half-hour drive to the airport. The people, like the landscape, were fixed on separation, and I doubted that the difficulties with Europe would force them in any other direction. And I, too, was on my way back, as uncertain as ever about Iceland and my place in it. I returned to the clinging heat and my own separation from home, which, as before, I also recognized as my homecoming to Brisbane. Isn’t that in the nature of split affinities, to always be nearly there but never quite there? In the weeks since my return, the Icelanders have voted by referendum to reject the deal made for the repayment of the Icesave debts, and a fresh round of negotiations with the British and Dutch governments begins. For the time being, Iceland retains its right to independence, at least as expressed by the right to sidestep the consequences of its unhappy raids into Europe. Pinning down the Devil, it seems, is just as hard as ever.