The determinants of loan delinquency among co-operative financial institutions in South Africa
- Authors: Bixa, Sisipho
- Date: 2022-04
- Subjects: Financial institutions -- South Africa , Loans
- Language: English
- Type: Master's theses , text
- Identifier: http://hdl.handle.net/10948/57546 , vital:58064
- Description: The world's attention has been drawn to co-operatives since the 2008 financial crisis because of their resilience and ability to prosper in adverse economic situations. Co-operatives, particularly Co-operative Financial Institutions (CFIs), have increased their participation, proving to be a channel for increasing access to finance for the previously unbanked, poverty reduction, and sustained socioeconomic growth across the African continent. Co-operatives have the potential to be a catalyst for long-term growth, which is especially important in a country like South Africa, yet they have been failing owing to loan default. Loan delinquency is a major threat to CFI's ability to continue granting loans to loan applicants and to grow the business. CFIs are unable to recoup the monies they have provided to loan borrowers, as the default rate has steadily increased. This influences the CFIs' financial obligations. The financial growth of CFIs is vital, and failure to keeping cash in circulation has an impact on their fundamental business. In South Africa, CFIs have observed a surge in loan defaults since 2010. Proper loan appraisals, timely reminders of loan recipients' repayments, and escalation on prompt follow-up on loan defaulters all are priorities for CFI management. Despite the efforts of CFIs to reduce delinquency, it has continuously increased. The objective of this study was to figure out what factors influence loan delinquency among CFIs. The study looked at an average of 47 CFIs in South Africa. Another objective of this study was to investigate the extent of loan delinquency among South African CFIs. The study used a quantitative approach, with secondary data obtained from CBDA. Descriptive statistics were used to evaluate the model's goodness of fit. The computed results show that this study has only one-way cross-sectional effects. In this example, the null hypothesis of the Breusch-Pagan (BP) test of "POLS is appropriate" is rejected. According to the descriptive statistics presented in the following section, the null hypothesis of regularly distributed data is not rejected. Pearson correlation was used to determine whether there was a relationship between the control variables and the dependent variable. The least squares regression output from the study was presented in the final section. Finally, GLS regression with random effects was used to examine the relationship between total loan delinquency and the dependent variables. x The research looked at seven independent variables: share league/affiliation, the proportion of women in total membership, youth savings, interest rates, total account receivables, and loan portfolio. However, the results of youth savings, interest rate, and total savings deposits may not be reliable because they are statistically insignificant. According to the study, financial institutions should provide easily accessible and accurate payment methods to encourage borrowers to pay on time. This can be accomplished by creating a website. In addition, CFIs/credit intuitions use a share league/affiliation method to maximize their responsible ownership and investigate why women's membership leads to lower loan delinquency. , Thesis (MA) -- Faculty of Business and Economic science , 2022
- Full Text:
- Date Issued: 2022-04
- Authors: Bixa, Sisipho
- Date: 2022-04
- Subjects: Financial institutions -- South Africa , Loans
- Language: English
- Type: Master's theses , text
- Identifier: http://hdl.handle.net/10948/57546 , vital:58064
- Description: The world's attention has been drawn to co-operatives since the 2008 financial crisis because of their resilience and ability to prosper in adverse economic situations. Co-operatives, particularly Co-operative Financial Institutions (CFIs), have increased their participation, proving to be a channel for increasing access to finance for the previously unbanked, poverty reduction, and sustained socioeconomic growth across the African continent. Co-operatives have the potential to be a catalyst for long-term growth, which is especially important in a country like South Africa, yet they have been failing owing to loan default. Loan delinquency is a major threat to CFI's ability to continue granting loans to loan applicants and to grow the business. CFIs are unable to recoup the monies they have provided to loan borrowers, as the default rate has steadily increased. This influences the CFIs' financial obligations. The financial growth of CFIs is vital, and failure to keeping cash in circulation has an impact on their fundamental business. In South Africa, CFIs have observed a surge in loan defaults since 2010. Proper loan appraisals, timely reminders of loan recipients' repayments, and escalation on prompt follow-up on loan defaulters all are priorities for CFI management. Despite the efforts of CFIs to reduce delinquency, it has continuously increased. The objective of this study was to figure out what factors influence loan delinquency among CFIs. The study looked at an average of 47 CFIs in South Africa. Another objective of this study was to investigate the extent of loan delinquency among South African CFIs. The study used a quantitative approach, with secondary data obtained from CBDA. Descriptive statistics were used to evaluate the model's goodness of fit. The computed results show that this study has only one-way cross-sectional effects. In this example, the null hypothesis of the Breusch-Pagan (BP) test of "POLS is appropriate" is rejected. According to the descriptive statistics presented in the following section, the null hypothesis of regularly distributed data is not rejected. Pearson correlation was used to determine whether there was a relationship between the control variables and the dependent variable. The least squares regression output from the study was presented in the final section. Finally, GLS regression with random effects was used to examine the relationship between total loan delinquency and the dependent variables. x The research looked at seven independent variables: share league/affiliation, the proportion of women in total membership, youth savings, interest rates, total account receivables, and loan portfolio. However, the results of youth savings, interest rate, and total savings deposits may not be reliable because they are statistically insignificant. According to the study, financial institutions should provide easily accessible and accurate payment methods to encourage borrowers to pay on time. This can be accomplished by creating a website. In addition, CFIs/credit intuitions use a share league/affiliation method to maximize their responsible ownership and investigate why women's membership leads to lower loan delinquency. , Thesis (MA) -- Faculty of Business and Economic science , 2022
- Full Text:
- Date Issued: 2022-04
Impact of microfinance institutions on small business sustainability in Nelson Mandela Bay
- Authors: Mgoduka, Bulelwa Keitumetse
- Date: 2015
- Subjects: Microfinance , Financial institutions -- South Africa , Small business -- South Africa -- Eastern Cape
- Language: English
- Type: Thesis , Doctoral , MPhil
- Identifier: http://hdl.handle.net/10948/8564 , vital:26407
- Description: The rise of microfinance in South Africa as a development trajectory has dismissed ideas that small business enterprises have no significant contribution to the economic growth and development of the country. The primary objective of the study is to assess the impact of microfinance service providers on the success and sustainability of small business enterprises in the Nelson Mandela Bay. By applying descriptive statistics, 2 ordinary least square regression analyses as well as correlation matrix; the results reveal that microfinance has a positive and significant impact on the success and sustainability on small business enterprises in the Nelson Mandela Bay. The research findings hold a variety of implications for Government and policymakers. The study recommends that the microfinance sector must be under good governance through the microfinance regulatory and supervisory structures, since the sector contributes a great deal towards one of the most important objectives of the Post-Apartheid Government. Further, small business entrepreneurs must be well exposed to the requirements, standards and norms which govern the financial sector. This is particularly important in terms of the National Credit Act provisions.
- Full Text:
- Date Issued: 2015
- Authors: Mgoduka, Bulelwa Keitumetse
- Date: 2015
- Subjects: Microfinance , Financial institutions -- South Africa , Small business -- South Africa -- Eastern Cape
- Language: English
- Type: Thesis , Doctoral , MPhil
- Identifier: http://hdl.handle.net/10948/8564 , vital:26407
- Description: The rise of microfinance in South Africa as a development trajectory has dismissed ideas that small business enterprises have no significant contribution to the economic growth and development of the country. The primary objective of the study is to assess the impact of microfinance service providers on the success and sustainability of small business enterprises in the Nelson Mandela Bay. By applying descriptive statistics, 2 ordinary least square regression analyses as well as correlation matrix; the results reveal that microfinance has a positive and significant impact on the success and sustainability on small business enterprises in the Nelson Mandela Bay. The research findings hold a variety of implications for Government and policymakers. The study recommends that the microfinance sector must be under good governance through the microfinance regulatory and supervisory structures, since the sector contributes a great deal towards one of the most important objectives of the Post-Apartheid Government. Further, small business entrepreneurs must be well exposed to the requirements, standards and norms which govern the financial sector. This is particularly important in terms of the National Credit Act provisions.
- Full Text:
- Date Issued: 2015
A study exploring the relationship between employee happiness and financial performance within a South African financial institution
- Authors: Waugh, Geoffrey William
- Date: 2014
- Subjects: Financial institutions -- South Africa , Employee motivation , Financial institutions -- Ratings and rankings , Banks and banking -- South Africa , Bank employees -- South Africa , Job satisfaction
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: vital:827 , http://hdl.handle.net/10962/d1012080
- Description: This research is an investigation of the relationship between employees 'happiness' and the financial performance of a financial services organisation in South Africa. As a component of the financial services industry the banking sector contributes greatly to the economic growth of the country. The South African Banking sector is concentrated and highly competitive. It is vital for banks to maintain competitiveness and ever increasing global competition adds further pressure on organisations to financially perform so as to meet the demands of their shareholders. The literature that has been reviewed and previous research suggest that employee 'happiness' is a vital variable influencing the performance and success of individuals. Organisational performance will be measured in terms of financial performance for the purposes of this research. The concept of financial performance and 'happiness' are discussed and a questionnaire based on the Satisfaction With Life Scale (Diener et al,1985) is used to determine the levels of 'happiness' at selected branches within the institution. The individual branches financial performance is determined via calculating selected ratios, namely cumulative leverage, cost to income ratio and net yield. An analysis of correlation was conducted to establish whether or not a relationship of statistical significance exists between employee 'happiness' and financial performance. It was concluded that there is no relationship of statistical significance between employee 'happiness' and the financial performance of branches within the organisation, it was suggested that other factors exert a much greater influence over financial performance. Some of these factors influencing financial performance are discussed and recommendations for further research are made.
- Full Text:
- Date Issued: 2014
- Authors: Waugh, Geoffrey William
- Date: 2014
- Subjects: Financial institutions -- South Africa , Employee motivation , Financial institutions -- Ratings and rankings , Banks and banking -- South Africa , Bank employees -- South Africa , Job satisfaction
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: vital:827 , http://hdl.handle.net/10962/d1012080
- Description: This research is an investigation of the relationship between employees 'happiness' and the financial performance of a financial services organisation in South Africa. As a component of the financial services industry the banking sector contributes greatly to the economic growth of the country. The South African Banking sector is concentrated and highly competitive. It is vital for banks to maintain competitiveness and ever increasing global competition adds further pressure on organisations to financially perform so as to meet the demands of their shareholders. The literature that has been reviewed and previous research suggest that employee 'happiness' is a vital variable influencing the performance and success of individuals. Organisational performance will be measured in terms of financial performance for the purposes of this research. The concept of financial performance and 'happiness' are discussed and a questionnaire based on the Satisfaction With Life Scale (Diener et al,1985) is used to determine the levels of 'happiness' at selected branches within the institution. The individual branches financial performance is determined via calculating selected ratios, namely cumulative leverage, cost to income ratio and net yield. An analysis of correlation was conducted to establish whether or not a relationship of statistical significance exists between employee 'happiness' and financial performance. It was concluded that there is no relationship of statistical significance between employee 'happiness' and the financial performance of branches within the organisation, it was suggested that other factors exert a much greater influence over financial performance. Some of these factors influencing financial performance are discussed and recommendations for further research are made.
- Full Text:
- Date Issued: 2014
Volatility transmission across South African financial markets: does the bull – bear distinction matter?
- Authors: Jaramba, Toddy
- Date: 2011
- Subjects: Finance -- South Africa , Financial institutions -- South Africa , Monetary policy -- South Africa , Portfolio management -- South Africa , Stock exchanges -- South Africa , Foreign exchange -- Mathematical models , Bond market -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1106 , http://hdl.handle.net/10962/d1013396
- Description: The volatility transmission in financial markets has important implications for investment decision making, portfolio diversification and overall macroeconomic stability. This paper analyses volatility transmission across four South African financial markets that is the stock, bond, money and foreign exchange markets, using daily data for the period 2000-2010. It also shows whether the volatilities in the SA financial markets present a different behaviour in bull and bear market phases. The effects of the international markets volatility to the local markets volatility was also looked at in this study. To obtain estimates of market volatility, the study experimented with various volatility models that include the GARCH, EGARCH and TARCH. To examine volatility interaction and the transmission of volatility shocks, a VAR model was estimated together with block exogeneity, impulse response and variance decomposition. The study found that there is limited volatility transmission across the SA financial markets. The study also found that the money market is the most exogenous of all markets since the other three financial markets volatility is insignificant to the money market (see impulse response results). For the bond market, volatility transmission was characterized with a decreasing trend. With regard to international markets volatility, it concluded that, the shocks in the international markets will eventually affect the movement in the local markets. The results also highlighted that, world and local markets are important in accelerating the volatility transmission in SA financial markets depending on whether they are in their bull or bear phases. In the case of South Africa, the study found that volatility transmission across markets is higher during bear market periods than bull market periods. Basing on the study results which show that the volatility transmission is limited across SA financial markets, the implication to local and international investors is that there is a greater potential for diversifying risk by investing in different South African financial markets.
- Full Text:
- Date Issued: 2011
- Authors: Jaramba, Toddy
- Date: 2011
- Subjects: Finance -- South Africa , Financial institutions -- South Africa , Monetary policy -- South Africa , Portfolio management -- South Africa , Stock exchanges -- South Africa , Foreign exchange -- Mathematical models , Bond market -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1106 , http://hdl.handle.net/10962/d1013396
- Description: The volatility transmission in financial markets has important implications for investment decision making, portfolio diversification and overall macroeconomic stability. This paper analyses volatility transmission across four South African financial markets that is the stock, bond, money and foreign exchange markets, using daily data for the period 2000-2010. It also shows whether the volatilities in the SA financial markets present a different behaviour in bull and bear market phases. The effects of the international markets volatility to the local markets volatility was also looked at in this study. To obtain estimates of market volatility, the study experimented with various volatility models that include the GARCH, EGARCH and TARCH. To examine volatility interaction and the transmission of volatility shocks, a VAR model was estimated together with block exogeneity, impulse response and variance decomposition. The study found that there is limited volatility transmission across the SA financial markets. The study also found that the money market is the most exogenous of all markets since the other three financial markets volatility is insignificant to the money market (see impulse response results). For the bond market, volatility transmission was characterized with a decreasing trend. With regard to international markets volatility, it concluded that, the shocks in the international markets will eventually affect the movement in the local markets. The results also highlighted that, world and local markets are important in accelerating the volatility transmission in SA financial markets depending on whether they are in their bull or bear phases. In the case of South Africa, the study found that volatility transmission across markets is higher during bear market periods than bull market periods. Basing on the study results which show that the volatility transmission is limited across SA financial markets, the implication to local and international investors is that there is a greater potential for diversifying risk by investing in different South African financial markets.
- Full Text:
- Date Issued: 2011
An analysis of the money market linkages between South Africa and selected major world economies
- Authors: Barnor, Joel A
- Date: 2009
- Subjects: South African Reserve Bank , Banks and banking, Central -- South Africa , Money market -- South Africa , Monetary policy -- South Africa , Foreign exchange rates -- South Africa , International economic relations , Interest rates -- South Africa , Financial institutions -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:956 , http://hdl.handle.net/10962/d1002690 , South African Reserve Bank , Banks and banking, Central -- South Africa , Money market -- South Africa , Monetary policy -- South Africa , Foreign exchange rates -- South Africa , International economic relations , Interest rates -- South Africa , Financial institutions -- South Africa
- Description: Globalisation and financial liberalisation has increased the linkages across countries in recent times. The existence of money market links has important implications for both domestic monetary policy and for investment decisions. This study examines the linkages between South Africa’s money market and selected major international money markets. The objectives of the study are firstly to examine the links between the repo rate of South Africa and the central bank rates of the EU, Japan, UK and US. Secondly, is to compare the influence of domestic and foreign monetary policy decisions on South Africa’s money market. The third objective is to examine the long run relationship between the South African money market and the money markets of its major trading partners. Three estimation techniques are used to examine the different links. Principal components analysis, four tests of cointegration, and stationarity tests of the spreads/risk premium between South Africa’s interest rates and the interest rates of the other countries. All three techniques show that there is no long-run link between South Africa’s central bank rates and the central bank rates of the other countries. This shows that the repo rate does not depend on movements in other central bank rates. Domestic money market interest rates respond strongly to changes in the repo rate whilst showing no dependence on central bank rates of the other countries. This confirms the autonomy of the South African Reserve Bank in carrying out policy objectives. When the risk premium is accounted for under the third technique, evidence of integration is found. This indicates that the risk premium plays a crucial part in the level of integration between South Africa and the countries included in the study.
- Full Text:
- Date Issued: 2009
- Authors: Barnor, Joel A
- Date: 2009
- Subjects: South African Reserve Bank , Banks and banking, Central -- South Africa , Money market -- South Africa , Monetary policy -- South Africa , Foreign exchange rates -- South Africa , International economic relations , Interest rates -- South Africa , Financial institutions -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:956 , http://hdl.handle.net/10962/d1002690 , South African Reserve Bank , Banks and banking, Central -- South Africa , Money market -- South Africa , Monetary policy -- South Africa , Foreign exchange rates -- South Africa , International economic relations , Interest rates -- South Africa , Financial institutions -- South Africa
- Description: Globalisation and financial liberalisation has increased the linkages across countries in recent times. The existence of money market links has important implications for both domestic monetary policy and for investment decisions. This study examines the linkages between South Africa’s money market and selected major international money markets. The objectives of the study are firstly to examine the links between the repo rate of South Africa and the central bank rates of the EU, Japan, UK and US. Secondly, is to compare the influence of domestic and foreign monetary policy decisions on South Africa’s money market. The third objective is to examine the long run relationship between the South African money market and the money markets of its major trading partners. Three estimation techniques are used to examine the different links. Principal components analysis, four tests of cointegration, and stationarity tests of the spreads/risk premium between South Africa’s interest rates and the interest rates of the other countries. All three techniques show that there is no long-run link between South Africa’s central bank rates and the central bank rates of the other countries. This shows that the repo rate does not depend on movements in other central bank rates. Domestic money market interest rates respond strongly to changes in the repo rate whilst showing no dependence on central bank rates of the other countries. This confirms the autonomy of the South African Reserve Bank in carrying out policy objectives. When the risk premium is accounted for under the third technique, evidence of integration is found. This indicates that the risk premium plays a crucial part in the level of integration between South Africa and the countries included in the study.
- Full Text:
- Date Issued: 2009
Financial instability in South Africa : trends and interactions within the financial markets
- Authors: Shikwambana, Jamela
- Date: 2007 , 2013-08-06
- Subjects: Finance -- South Africa , Financial institutions -- South Africa , Economic stabilization -- South Africa , Stock exchanges -- South Africa , Stocks -- Prices -- South Africa , Interest rates -- South Africa , Equilibrium (Economics)
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1043 , http://hdl.handle.net/10962/d1005911 , Finance -- South Africa , Financial institutions -- South Africa , Economic stabilization -- South Africa , Stock exchanges -- South Africa , Stocks -- Prices -- South Africa , Interest rates -- South Africa , Equilibrium (Economics)
- Description: This study seeks to investigate the trends and interactions of market volatility as a source of instability in the South African financial markets. Financial instability can be manifested in the form of banking and currency crisis, institutional failures and extreme asset price volatility. This study, however, focuses on a single aspect of financial instability - asset price volatility. Asset price volatility reflects changes in market expectations as investors react to such changes, and thus on its own is not necessarily a source of instability. However, volatility spillovers can propagate volatility shocks across the market, increasing the risk of widespread instability. Using a combination of graphical and trend analysis as well as more formal estimation techniques, the study examined volatility in the stock, money and foreign exchange markets. To obtain estimates of market volatility, the study experimented with various volatility models that include the GARCH, TARCH and EGARCH. An analysis of volatility interactions and the transmission of volatility shocks across the market is crucial to understanding financial instability. To examine volatility interaction and the transmission of volatility shocks, a VAR model was estimated. This framework allowed us to examine the propagation of shocks across the markets. Volatility in the financial markets was found to be highly persistent and in the case of exchange rates, volatility was also characterised by an increasing trend. Significant linkages between the financial markets were found. The links also extended to the volatility relationship as evidenced by significant volatility spillovers across the markets. While volatility spillovers from the money market were found in the stock market and the foreign exchange market, no volatility spillovers from these markets were found in the money market. Thus the money market was identified as the major source of volatility spillovers and shocks in the financial markets. These results highlighted the role of monetary policy in the financial system, specifically the need to make monetary policy stable and predictable to ensure that interest rate shocks are not an additional source of instability. , KMBT_363 , Adobe Acrobat 9.54 Paper Capture Plug-in
- Full Text:
- Date Issued: 2007
- Authors: Shikwambana, Jamela
- Date: 2007 , 2013-08-06
- Subjects: Finance -- South Africa , Financial institutions -- South Africa , Economic stabilization -- South Africa , Stock exchanges -- South Africa , Stocks -- Prices -- South Africa , Interest rates -- South Africa , Equilibrium (Economics)
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1043 , http://hdl.handle.net/10962/d1005911 , Finance -- South Africa , Financial institutions -- South Africa , Economic stabilization -- South Africa , Stock exchanges -- South Africa , Stocks -- Prices -- South Africa , Interest rates -- South Africa , Equilibrium (Economics)
- Description: This study seeks to investigate the trends and interactions of market volatility as a source of instability in the South African financial markets. Financial instability can be manifested in the form of banking and currency crisis, institutional failures and extreme asset price volatility. This study, however, focuses on a single aspect of financial instability - asset price volatility. Asset price volatility reflects changes in market expectations as investors react to such changes, and thus on its own is not necessarily a source of instability. However, volatility spillovers can propagate volatility shocks across the market, increasing the risk of widespread instability. Using a combination of graphical and trend analysis as well as more formal estimation techniques, the study examined volatility in the stock, money and foreign exchange markets. To obtain estimates of market volatility, the study experimented with various volatility models that include the GARCH, TARCH and EGARCH. An analysis of volatility interactions and the transmission of volatility shocks across the market is crucial to understanding financial instability. To examine volatility interaction and the transmission of volatility shocks, a VAR model was estimated. This framework allowed us to examine the propagation of shocks across the markets. Volatility in the financial markets was found to be highly persistent and in the case of exchange rates, volatility was also characterised by an increasing trend. Significant linkages between the financial markets were found. The links also extended to the volatility relationship as evidenced by significant volatility spillovers across the markets. While volatility spillovers from the money market were found in the stock market and the foreign exchange market, no volatility spillovers from these markets were found in the money market. Thus the money market was identified as the major source of volatility spillovers and shocks in the financial markets. These results highlighted the role of monetary policy in the financial system, specifically the need to make monetary policy stable and predictable to ensure that interest rate shocks are not an additional source of instability. , KMBT_363 , Adobe Acrobat 9.54 Paper Capture Plug-in
- Full Text:
- Date Issued: 2007
Monetary policy transmission in South Africa: the prime rate-demand for credit phase
- Authors: Lehobo, Limakatso
- Date: 2006
- Subjects: South African Reserve Bank , Monetary policy -- South Africa , Banks and banking -- South Africa , Bank loans -- South Africa , Financial institutions -- South Africa , Finance -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1128 , http://hdl.handle.net/10962/d1020850
- Description: A voluminous literature attempts to explain the various channels of the monetary policy transmission mechanism through which central banks ultimately achieve price stability. However, most research focuses on interest rate pass-through and the demand for money phase, while there is limited research on the demand for credit. This study endeavours to contribute to the understanding of this neglected phase of monetary policy transmission by exploring the response of the real demand for bank credit by the private sector to changes in the real prime rate from 1990:1 to 2004:4 in South Africa. Firstly, the behaviour of the real prime rate in relation to the repo rate is explored using graphical analysis. The study observes that an increase in the repo rate causes an increase in the real prime rate, such that there is always a margin of three or four percentage points between the two rates. Secondly, using secondary data, the Johansen methodology is used to determine the relationship between the demand for bank credit and its determinants (GDP, inflation, real prime rate and real yield on government bonds). Two co-integrating relationships are found. The Gaussian errors from one co-integrating vector are used to model the Vector Error Correction Model, which provides the short-run dynamics and the long-run results, through the use of Eviews 5 software. The results of the study show that while all other variables are negatively related to the demand for bank credit in the long-run, GDP has a positive influence. In the short-run, yield on government bonds and inflation coefficients depict a positive association, while the coefficients of real prime rate and GDP are negative. The error correction coefficient is -0.32, which implies that a 32% adjustment to equilibrium happens in the demand for bank credit in a quarter and that the complete adjustment takes about three quarters to complete. Thirdly, the generalised impulse responses results indicate that the impact on the real prime rate affects the demand for bank credit from the first quarter. The study concludes that the real prime rate has a negative impact on the demand for credit both in the short-run and long-run.
- Full Text:
- Date Issued: 2006
- Authors: Lehobo, Limakatso
- Date: 2006
- Subjects: South African Reserve Bank , Monetary policy -- South Africa , Banks and banking -- South Africa , Bank loans -- South Africa , Financial institutions -- South Africa , Finance -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1128 , http://hdl.handle.net/10962/d1020850
- Description: A voluminous literature attempts to explain the various channels of the monetary policy transmission mechanism through which central banks ultimately achieve price stability. However, most research focuses on interest rate pass-through and the demand for money phase, while there is limited research on the demand for credit. This study endeavours to contribute to the understanding of this neglected phase of monetary policy transmission by exploring the response of the real demand for bank credit by the private sector to changes in the real prime rate from 1990:1 to 2004:4 in South Africa. Firstly, the behaviour of the real prime rate in relation to the repo rate is explored using graphical analysis. The study observes that an increase in the repo rate causes an increase in the real prime rate, such that there is always a margin of three or four percentage points between the two rates. Secondly, using secondary data, the Johansen methodology is used to determine the relationship between the demand for bank credit and its determinants (GDP, inflation, real prime rate and real yield on government bonds). Two co-integrating relationships are found. The Gaussian errors from one co-integrating vector are used to model the Vector Error Correction Model, which provides the short-run dynamics and the long-run results, through the use of Eviews 5 software. The results of the study show that while all other variables are negatively related to the demand for bank credit in the long-run, GDP has a positive influence. In the short-run, yield on government bonds and inflation coefficients depict a positive association, while the coefficients of real prime rate and GDP are negative. The error correction coefficient is -0.32, which implies that a 32% adjustment to equilibrium happens in the demand for bank credit in a quarter and that the complete adjustment takes about three quarters to complete. Thirdly, the generalised impulse responses results indicate that the impact on the real prime rate affects the demand for bank credit from the first quarter. The study concludes that the real prime rate has a negative impact on the demand for credit both in the short-run and long-run.
- Full Text:
- Date Issued: 2006
Development of the South African monetary banking sector and money market
- Authors: Patel, Aadil Suleman
- Date: 2005
- Subjects: South African Reserve Bank , Banks and banking -- South Africa , Money market -- South Africa , Economic development -- South Africa , Monetary policy -- South Africa , South Africa -- Economic conditions , Financial institutions -- South Africa , Money -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:997 , http://hdl.handle.net/10962/d1002732 , South African Reserve Bank , Banks and banking -- South Africa , Money market -- South Africa , Economic development -- South Africa , Monetary policy -- South Africa , South Africa -- Economic conditions , Financial institutions -- South Africa , Money -- South Africa
- Description: This thesis presents a theoretical analysis of developments in the South African monetary banking sector and money market. In the first section, evolution of the political, social and economic environments over the past few decades are discussed to provide the reader with an idea of some factors responsible for the underdeveloped nature of this market. It has been argued that the domestic political and economic landscape is relatively stable. Nevertheless, factors such as Zimbabwe’s political and ensuing economic turmoil, coupled with numerous financial crises in other developing nations have had negative consequences on domestic financial market development and economic growth. The current state of monetary policy is also analysed, within the economic environment, and various policy considerations have been put forth concerning the inflation targeting policy. The thesis then goes on to scrutinise the statutory and institutional environments within which the monetary banking institutions operate. Recent changes in the regulations governing the operations of these institutions are identified, together with the consequences of such laws on banking institutions and possible amendments have been suggested. In particular, a system of Asset Based Reserve Requirements (ABRR) has been recommended, in place of the current cash reserve requirement, to ensure regulators create a level playing field in the financial sector. The system can also provide authorities with the necessary control required to direct funds to the most desirable sectors of the economy. Development of the interbank market and the effect of reduced banking competition on the efficacy of the South African Reserve Bank’s refinancing operations and inflation targeting policy are also considered. Finally, the thesis analyses some effects of financial development on the South African economy, and whether it is in the best interests of the country to pursue financial reforms with such vigour. While financial development may bring South Africa closer to international standards of best practice, the timing and extent of the reforms will be critical to guarantee success.
- Full Text:
- Date Issued: 2005
- Authors: Patel, Aadil Suleman
- Date: 2005
- Subjects: South African Reserve Bank , Banks and banking -- South Africa , Money market -- South Africa , Economic development -- South Africa , Monetary policy -- South Africa , South Africa -- Economic conditions , Financial institutions -- South Africa , Money -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:997 , http://hdl.handle.net/10962/d1002732 , South African Reserve Bank , Banks and banking -- South Africa , Money market -- South Africa , Economic development -- South Africa , Monetary policy -- South Africa , South Africa -- Economic conditions , Financial institutions -- South Africa , Money -- South Africa
- Description: This thesis presents a theoretical analysis of developments in the South African monetary banking sector and money market. In the first section, evolution of the political, social and economic environments over the past few decades are discussed to provide the reader with an idea of some factors responsible for the underdeveloped nature of this market. It has been argued that the domestic political and economic landscape is relatively stable. Nevertheless, factors such as Zimbabwe’s political and ensuing economic turmoil, coupled with numerous financial crises in other developing nations have had negative consequences on domestic financial market development and economic growth. The current state of monetary policy is also analysed, within the economic environment, and various policy considerations have been put forth concerning the inflation targeting policy. The thesis then goes on to scrutinise the statutory and institutional environments within which the monetary banking institutions operate. Recent changes in the regulations governing the operations of these institutions are identified, together with the consequences of such laws on banking institutions and possible amendments have been suggested. In particular, a system of Asset Based Reserve Requirements (ABRR) has been recommended, in place of the current cash reserve requirement, to ensure regulators create a level playing field in the financial sector. The system can also provide authorities with the necessary control required to direct funds to the most desirable sectors of the economy. Development of the interbank market and the effect of reduced banking competition on the efficacy of the South African Reserve Bank’s refinancing operations and inflation targeting policy are also considered. Finally, the thesis analyses some effects of financial development on the South African economy, and whether it is in the best interests of the country to pursue financial reforms with such vigour. While financial development may bring South Africa closer to international standards of best practice, the timing and extent of the reforms will be critical to guarantee success.
- Full Text:
- Date Issued: 2005
An assessment of the impact of organisational restructuring on the morale of employees at a selected financial institution
- Authors: Zweni, Tembela
- Date: 2004
- Subjects: Organizational change , Employee morale , Financial institutions -- South Africa
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: vital:9267 , http://hdl.handle.net/10948/204 , Organizational change , Employee morale , Financial institutions -- South Africa
- Description: Rising global competition, the influence of advances in information technology and the re-engineering of business processes are some of the imperatives that force organisations to restructure their businesses. In South Africa, the situation is even more compelling, with the recent democratisation of the country that requires companies to implement certain restructuring programmes designed to empower previously disadvantaged individuals. Organisational restructuring is therefore inevitable for any organisation. These changes, however, do affect organisations and employees. Employees become insecure, confused about their jobs, and therefore less productive. To the extent that change can adversely affect both organisations and employees, it becomes critical that organisations should implement it carefully, if they are to survive. To achieve this, requires managers to fully understand drivers of change, the possible consequences of change on both organisation and employees, and to take appropriate actions. The main objective of this study was to identify possible approaches that organisations can pursue in implementing restructuring without adversely affecting the employees. The practical context chosen was an organisation that had recently implemented organisational restructuring. The research methodology for this study entailed the conducting of an intensive study of the relevant literature, to determine what the theory reveals in respect of restructuring strategies that can assist organisations in effectively implementing the restructuring process. Dissertations, theses, research reports and journals were consulted, in an attempt to formulate a theoretical basis for this study. The contemporary literature reveals that there are various strategies that organisations can employ to effectively restructure their organisations with minimal adverse influence on employees. The restructuring organisations should ensure that employees are genuinely involved in the process at the iv outset. The desired changes and the benefits thereof, should be clearly and consistently communicated to the employees at the beginning of the restructuring process. An empirical study was then conducted at the chosen organisation that had recently embarked on an organisational restructuring. The focal point of the empirical study was to determine how this organisation had implemented its restructuring process. The main purpose was to establish the impact that this restructuring had on the morale and motivation of the employees. The final step of this study included an assessment of the findings. This was done so that suitable conclusions could be drawn and appropriate recommendations made. The conclusions revolved around the effects of restructuring on the employees of this organisation. The focus of the recommendations was on what approaches the restructuring organisations should follow to successfully and effectively implement the restructuring process, without adversely affecting the employees.
- Full Text:
- Date Issued: 2004
- Authors: Zweni, Tembela
- Date: 2004
- Subjects: Organizational change , Employee morale , Financial institutions -- South Africa
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: vital:9267 , http://hdl.handle.net/10948/204 , Organizational change , Employee morale , Financial institutions -- South Africa
- Description: Rising global competition, the influence of advances in information technology and the re-engineering of business processes are some of the imperatives that force organisations to restructure their businesses. In South Africa, the situation is even more compelling, with the recent democratisation of the country that requires companies to implement certain restructuring programmes designed to empower previously disadvantaged individuals. Organisational restructuring is therefore inevitable for any organisation. These changes, however, do affect organisations and employees. Employees become insecure, confused about their jobs, and therefore less productive. To the extent that change can adversely affect both organisations and employees, it becomes critical that organisations should implement it carefully, if they are to survive. To achieve this, requires managers to fully understand drivers of change, the possible consequences of change on both organisation and employees, and to take appropriate actions. The main objective of this study was to identify possible approaches that organisations can pursue in implementing restructuring without adversely affecting the employees. The practical context chosen was an organisation that had recently implemented organisational restructuring. The research methodology for this study entailed the conducting of an intensive study of the relevant literature, to determine what the theory reveals in respect of restructuring strategies that can assist organisations in effectively implementing the restructuring process. Dissertations, theses, research reports and journals were consulted, in an attempt to formulate a theoretical basis for this study. The contemporary literature reveals that there are various strategies that organisations can employ to effectively restructure their organisations with minimal adverse influence on employees. The restructuring organisations should ensure that employees are genuinely involved in the process at the iv outset. The desired changes and the benefits thereof, should be clearly and consistently communicated to the employees at the beginning of the restructuring process. An empirical study was then conducted at the chosen organisation that had recently embarked on an organisational restructuring. The focal point of the empirical study was to determine how this organisation had implemented its restructuring process. The main purpose was to establish the impact that this restructuring had on the morale and motivation of the employees. The final step of this study included an assessment of the findings. This was done so that suitable conclusions could be drawn and appropriate recommendations made. The conclusions revolved around the effects of restructuring on the employees of this organisation. The focus of the recommendations was on what approaches the restructuring organisations should follow to successfully and effectively implement the restructuring process, without adversely affecting the employees.
- Full Text:
- Date Issued: 2004
- «
- ‹
- 1
- ›
- »