Research Symposium-2015
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Browsing Research Symposium-2015 by Subject "Banking"
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Item Impact of credit risk management on financial performance: with special reference to Sri Lankan banking sector(Uva Wellassa University of Sri Lanka, 2015) Krishanthi, A.G.D.; Kulathunga, K.M.M.C.B.Credit risk is always treated as the major risk inherent in a bank’s trading and banking activities since credit creation is the main income generating activity for banks (Kargi, 2011). According to Danson Musyoki (2011) among the other predictors, credit risk is an important predictor of bank financial performance. Good heart (1998) states that the poor Credit risk management (CRM) which results in undue credit risk causes bank failures. Credit risk is the possibility of losing the outstanding loan partially or totally, due to credit events. Sri Lankan banks continued to invest huge sum of financial resources on CRM with the intention to maximizing returns and minimizing bank`s risks. The significance of the study is to have a big picture of how commercial banks manage their credit risk effectively. However contradictory findings and the scarcity of studies in relation to this field in the context of Sri Lanka has created an area for study with regard to seek the relationship between Credit Risk Management and Financial Performance (FP) of banks. Parameters covered in the study were; default rate (DR), bad debts costs (BDC), cost per loan asset (CLA) and Return on Asset (ROA). Accordingly, first objective was assigned to examine the relationship between CRM and FP. Second objective was to identify the most affecting Credit Risk Management factor on Financial Performance of banks. Methodology Descriptive research design was used for this study. Banking sector consider as the research population. Here, population consist Licensed Commercialized Banks and Licensed Specialized Banks. Due to unavailability of data and inconsistency between time periods only 21 banks registered under Sri Lanka banking act considered as sample. Therefore, secondary data of 21 banks were taken from balance sheet, income statement and notes of banks` for five years of time period. Further interview method was used to collect data from senior managers in various banks. To achieve the objectives of the research, secondary data was analyzed by using correlation coefficients analysis, regression analysis and descriptive statistical techniques. Moreover, the independent variable such as Credit Risk Management was measured using Default Rate ratio, Cost per Loan Asset Ratio and Bad Debt Cost ratio. Dependent variable such as Financial Performance was measured using Return on Asset ratio. Results and Discussion According to the Descriptive analysis, the mean value with respect to Default Rate, Bad Debt Cost and Cost per Loan Asset were 0.1043, 0.1014 and 0.2140 respectively. Considering the Bank Financial Performance, the mean value with respect Return on Assets was 0.2365.Item Impact of job satisfaction on organizational citizenship behavior; special reference to licensed commercial banks in Colombo(Uva Wellassa University of Sri Lanka, 2015) Rathnayake, R.M.D.M.; Fasana, S.F.A service sector, particularly banking sector is highly staff – intensive by its nature. In staff – and indispensable factor. Uniqueness of human resources is practically impossible to substitute them with any other factor. Human behavior has a strong influence on the working environment of an organization. It is capable of making the organization flourish or perish. Hence an employer should satisfy the physical and psychological needs of his employees in order to motivate them strive for the achievement of the organization goals. Job satisfaction is a favorable emotional state resulting from the appraisal of one’s job as achieving or facilitating the achievement of one’s job values. If one perceives that the job meets or allows fulfillment of one’s important values, one will experience a “pleasurable emotion of satisfaction”. If not, one will experience the emotion of dissatisfaction (Locke, 1983). Moreover Organizational citizenship behavior (OCB) has been considered to be one of the most important factors influencing organizational effectiveness. During the last two decades, the concept of OCB and its application have received a great importance in the world especially in the fields of psychology and management as well as received a great consideration in the literature. According to Organ (1988) OCB represents “individual behavior that is discretionary, not directly or explicitly recognized by the formal reward system, and that in the aggregate promotes the effective functioning of the organization. By discretionary, we mean that the behavior is not an enforceable requirement of the role or the job description, that is, the clearly specifiable terms of the person’s employment contract with the organization; the behavior is rather a matter of personal choice, such that its omission is not generally understood as punishable” (p.4). This study is designed to observe the impact of job satisfaction on organizational citizenship behavior. Research Questions What is the relationship between job satisfaction and OCB? What is the level of intrinsic job satisfaction? What is the level of extrinsic job satisfaction? What is the most significant job satisfaction factor which influences on OCB? Research Objectives • To identify the relationship between job satisfaction and OCB of licensed commercial banks in Sri Lankan context. level of intrinsic job satisfaction of licensed commercial banks in Sri level of extrinsic job satisfaction of licensed commercial banks in Sri most significant job satisfaction factor which influences on OCB of licensed commercial banks in Sri Lankan context? In accordance with the study, it is considering the employee job satisfaction and the organizational OCB of licensed commercial banks in Sri Lanka. Therefore researcher used 12 domestic Licensed Commercial Banks (LCBs) head offices situated in Colombo district in order to carry out the research study. Since the 91 percent of the commercial banks branches are domestic banks (Economic and social statistics of Sri Lanka 2013, CBSL) only domestic banks was taken, as well as Colombo district is taken because in banking density index Colombo district has the largest value that is 32 (Economic and social statistics of Sri Lanka 2013, CBSL). Primary data were collected through self- administered questionnaires as well as adapted questionnaires and questionnaires are based on five point Likert scale. Cronbach's alpha reliability test, descriptive statistics, Pearson correlation coefficient analysis and multiple linear regression analysis were used to analyze data. Results and Discussion According to description analysis level of both intrinsic and extrinsic job satisfaction is in a moderate level as well as overall level of OCB is in a moderate level. Furthermore, the correlation and regression analysis were conducted to determine the strength of relationship and relative contribution of independent variables. Here job satisfaction is the independent variable and OCB is the dependent variable. Pearson correlation between independent and dependent variables is 0.758. It indicates there is a high positive correlation between job satisfaction and OCB. According to hypothesis testing it was proved that the correlation between intrinsic job satisfaction and OCB (r = 0.719) as well as the correlation between extrinsic job satisfaction and OCB (r = 0.742) are positively correlated.Item Performance appraisals and its’ impacts on employee motivation: A study with special reference to Sri Lankan licensed commercial banks in Kandy District(Uva Wellassa University of Sri Lanka, 2015) Abeykoon, A.M.K.G.M.D.; Siyambalapitiya, J.Performance Appraisals System (PAS) is a well-established way of providing milestones, feedback, guidance and monitor employees (Weightman, 1999) and it is a formal, structured system of meaning and evaluating an employee’s job related behaviors. Further outcome to discover how and why the employee is presently performing on the job and employee can perform more effectively in the future, Therefore the employee, organization and society will be beneficiaries (Muhammad, 2013). Literature revealed that employee participation in the appraisal process was fairly very high and this positively affected employee motivation and perception of fairness. Consequently, organizations are advised to adopt participatory PAS in order to motivate employees and reduce biased considerations in both the process and outcome (Kofi, 2012). However, Douglas Mc Gregor (1957), Mushin Lee and Wonjun Shin (2000) said that conventional performance appraisals do more harm than good. Further the employees in Korean federal agencies believed that performance appraisals which are based on extrinsic factors influenced more to the employee motivation (Senong and Gregory, 2009).Nevertheless the transportation department in Iranian Esfahan province employees’ performance affected on their intrinsic motivation (P-Value <0.05) and the effectiveness is positive, equals to 0.414 (Shaemi Barzoki Ali et al, 2012). In order to above researcher gapes, three objectives were employed based on licensed commercial bank sector. Frist one was to identify the relationship between PAS and employee motivation. Second one was to determine the most effect dimensions of PAS for the employee motivation. Third one was to identify the current PAS which extent suit to motivate the employees. Methodology The population belongs to the research is all employees of both public and private sector who provide licensed domestic commercial banking service in Kandy district. For that, 84 employees were considered from the selected five licensed domestic commercial banks which have provided highest density of branches in Kandy district by using Stratified sampling technique and simple random sampling technique. Data was collected through a self-administered questionnaire from managerial level and non-managerial employees in the selected five licensed domestic commercial banks. The Cronbach Alpha reliability test shows that the Alpha value is 0.764. It is exceeded 0.700 level. Therefore it reached the acceptable level in the questionnaire. Results and Discussion Based on the results (see table 1) below, the procedural approaches are highly significance to improve employee motivation though the PAS in licensed domestic commercial banking sector. According to mean value of extrinsic motivation factors is emphasized that there is a significant impact of current PAS to increase the employee motivation of the commercial banking sector. Therefore it highly correlates with the employee motivation. Besides, intrinsic motivation factors also have moderate significant to create employee motivated PAS within the commercial banking sector. That reflected that extrinsic motivation factors have more influence in current PAS than intrinsic motivation factors.