The research sought to (i) bring about change and make the Bank more customer-centric using literature on leadership practice to inform the process, (ii) understand and articulate how leadership is enacted within the organisation, and (iii) generate actionable knowledge that is relevant for academic and practitioner communities. The research concludes with a brief reflection and synthesis of a re-calibrated view of the researcher's leadership DNA.

The thesis considers customer security in a major European bank Bank X. The action research focus is to strengthen the processes and the overall solution for online Bank customers which experience a significant growth and increase in use. There seem to be a common misperception between the internal staff of the bank and its customers regarding what security is, and the research considers several new security situations in the banking business. Moving from branch-oriented business to a digital orientation within the time space of just a few years has challenged banks to create new solutions for their customers. Such solutions must be secure, but technical security need separation from human security since new approaches as for example social engineering easily can be a source for fraud and losses for customers in a modern digital bank. This thesis uses action research by interviewing leaders and team members in one security team. The internal researcher role also introduce proposals and suggestions to the team during the research, which locate the action. A connection between stakeholders’ security definitions, re-organisations and the end solutions is important to understand, to improve the situation. Findings reveal that internal communications have an external customer’s communications effect and that re-organisational tasks should focus to adjust the external factors, not only internal benefits. Re-organisational planning does not increase customer security instantly, but some participants can see long-term benefits. The problem is, however, that the long-term world-view changes continuously, and without adjustments organisations depending on cyber security fall behind in the new, but ongoing battle between usability vs security and cost. A modern digital bank should no longer act as a traditional bank, but more as an IT company. This claim opens the way for new ideas and solutions, but blending the banking business and the computer industry can be challenging due to the professional distance between the groups. Future re-organisations should therefore aim for cross-divisional collaboration, increasing communication internally and opening routes for a dualistic contact with customers whereby information and awareness campaigns can be just as effective as technical and physical firewalls. The computer and banking industries are now working towards a remote market with a distance to the online-customers, and while the computer industry has experience to perform business with less customer contact, the banks have now also moved from close contact to digital contact. For this reason, modern banks must think differently and understand what the business is and how to secure it, but never forget the major resource and security problem – the human being.

This Thesis consists of three chapters examining the interaction and comovement between different financial assets in terms of their price, liquidity and volatility, and analysing the impact of the central bank's monetary policy stance on this interaction. ''The interaction of the Stock, Bond and CDS markets: An empirical analysis'' examines the price co-movements between the stock, bond, and CDS markets finding differences in the timing with which information is reflected in these asset-markets. It further identifies the factors that generate order flow in these markets focusing on the instruments controlled closely by the central bank. The examination of those instruments includes a comparison between standard and non-standard monetary policy measures and the identification of the monetary transmission channel. ''Sovereign Bond and CDS Market Liquidity. Arbitrage Activities and Central Bank Interventions'' analyses the joint dynamics of sovereign bond and CDS market liquidity taking into account the no-arbitrage relationship between them, i.e., the CDS-bond basis, and provides evidence of asymmetric liquidity interaction between the two asset-markets. The examination of central bank interventions and regulatory changes reveals that the ECB's open market purchases and the EU's naked CDS ban managed to limit the mispricing in the sovereign bond and CDS markets and improved the bond-CDS liquidity interaction. ''Volatility and Integration in the European Sovereign Bond and CDS Markets'' studies the strength and direction of volatility linkages between European sovereign bond yields and CDS spreads and assesses whether volatility linkages lead to stronger cross-asset integration. The analysis points to the existence of two blocs within the EMU according to the level of bond-CDS integration, a level which in the EMU South is inversely related to the CDS-bond basis. It additionally lends support to the implementation of non-standard monetary policy measures, since an easing in the ECB's policy stance improves the level of cross-asset integration.

This study aims primarily to assess the overall impact of corporate governance on corporate performance and corporate risk within the UK banking industry. More specifically, it investigates the influence of corporate governance on two important dimensions, these being: how a firm is performing in terms of financial and operational issues, and corporate risk in terms of liquidity and capital. The thesis will make a contribution to the existing body of theoretical literature pertaining to corporate governance in the UK banking-sector with respect to corporate governance performance relationships. To achieve this aim, the study undertakes a comprehensive literature review from which several hypotheses on the relational significance of corporate governance and corporate performance measures are developed. It then adopts a quantitative approach in which UK bankers and capital market brokers are surveyed to obtain primary data to use for testing those hypotheses. The testing is performed using econometric models and statistical analyses, from which the corporate governance trends are revealed. The outcomes have serious implications for the managements of banking companies as they demonstrate the importance of particular corporate governance variables, and recommend attention to the size of the board, board composition, the establishment of board committees, and the ownership structure of UK banking companies. In addition, several potential areas for further research are identified and reported.

The purpose of this study is to examine the root causes of the organisational inequity in the conventional retail banking sector in the Kingdom of Bahrain. It aims to recommend practical motivational and participative strategies to curb this problem. A critical review of three interdisciplinary fields (motivation, participation and leadership) has been conducted to identify inherent limitations in the key motivation theories and determine the main gaps in the existing knowledge. Although there is a broad literature providing useful insights, their applications remain untested and inconclusive. The current literature does not provide enough scope to understand the motivational process as an open system from a business perspective because psychoanalysis and behaviorism dominated the developmental process of most of the motivation theories. In addition, the extant literature provides a great deal of information about the explicit relationship between satisfaction and motivation but very little about the implicit relationship between dissatisfaction and motivation. This study uses mixed methods approach (quantitative and qualitative). Questionnaire and semi-structured interviews are used to collect the required numerical and non-numerical data. The main findings of this study confirm the existence of organisational inequity in the conventional retail banking sector in Bahrain, there is high demand for participative management due to lack of clear and effective motivational and participative strategies, although personal factors mitigate the negative impact of organisational inequity on motivation, inadequate monetary factors and ineffective non-monetary factors play a major role in determining the level of the organisational inequity, finally the motivational process in the conventional retail banking sector is an open system because it is exposed to changes in a wide spectrum of situational factors. The findings help raise awareness for decision-makers to introduce measures to promote and develop an Integrative Motivational Framework from which six practical recommendations are derived to integrate employees’ needs and expectations with the organisational objectives in order to address the organisational inequity.

An investigation and evaluation of the risks involved with resource constraints on global growth, with evidence from the finance sector. This is part of the GRO (Global Resource Observatory) project at the GSI, whose main project aim is to investigate how the scarcity of finite resources will impact global social and political fragility in the short term. This particular research focuses on how the scarcity of these finite resources will impact on the financial sector especially through investments, insurance, pension schemes and banking activities. The finance sector under investigation is the UK finance sector, considered to have one of the most globalised economies worldwide. The resources which were analysed were food, oil and energy/gas. The reason for the selection of food, oil and energy/gas prices is the volatility of its prices during the past decades and its high rate of fluctuations in its price in the last decade. A quantitative analysis is carried out using regression analysis of over 11 models with different combinations of resource and finance variables and a Granger causality analysis. Results show that resources only significantly affect the finance sector holding GDP constant, with exceptions where food and gas prices significantly affect bank variables even with the inclusion of GDP. The Granger causality analysis shows a couple of 1 and 3 year unidirectional relationships between some finance variables which could indicate the possibility of systemic risks in the finance sector caused by resource scarcity.

This thesis investigates the agency costs and moral hazard associated with the new capital regulation for banks in the event of balance-sheet losses. The recent introduction of "Bail-in" provisions, under which unsecured creditors must contribute to banks’ rescue through recapitalisation, and the regulatory stipulation of higher equity requirements, will have profound effects on the traditional agency relationships between shareholders and bondholders of banks. These Bail-in provisions imply, "Deviations from the Absolute Priority Rule" (DAPR). This dissertation undertakes quantitative and qualitative analyses of the new Bail-In structures, focusing on their microeconomic consequences that lead to perverse incentives of the equityholders and subsequently propose practical solutions to the identified problems. The first main result reveals that Bail-in could actually aggravate the agency costs by intensifying the "wealth transfer" from bondholders to equityholders. The second main result is to demonstrate that enforcing higher monitoring costs to the bondholders reduces equityholders’ incentive for moral hazard via higher cost of capital. The use of financial and non-financial covenants within the "Bail-In-Able Debt" indenture has been proposed as practical solutions to facilitate bondholders’ monitoring efforts. However, close to the Point of Non-Viability covenants are no longer effective as the risk of DAPR looms, and the equityholders are tempted to attempt "gamble-for-resurrection". To attenuate this distortion of shareholder incentives, Bail-in provision must impose some cost on shareholders. They could be made to face significant dilution, through a fair debt-to-equity swap with bondholders at market prices, or face full dilution via private expropriation by a new shareholder base that we term "Contingent Equity Base". This is the third main result. Overall, this dissertation makes a significant step forward into the understanding of the microeconomic consequences of the new bank’s capital regulation in general and the Contingent Convertibles in particular whilst offering practical solutions to the problems.

This thesis examines the concept of special purpose vehicles (SPVs) from a Shari’a (Islamic law) perspective. It thereafter investigates the practice of SPVs in the Islamic banking industry, using Kingdom of Bahrain as a case study. The review of literature explores the concept of SPVs, maqāsid al-shari’a (objectives of Islamic law), main Islamic financial principles, and main Islamic financial products used in conjunction with SPVs. This review of literature provides the theoretical foundation and understanding of SPVs in Islamic banking. Arguably one of the main Islamic financial hubs globally, the research uses the Kingdom of Bahrain as a case study. The investigation of SPV practices uses industry feedback through forty-four face-to-face semi-structured interviews, and secondary data. The secondary data consists of annual reports (which includes financial and Shari’a Supervisory Board annual reports), regulatory consultations, and a real-life executed SPV structure by an Islamic bank. A thematic analysis is used to qualitatively analyse interview responses, while a content analysis is used to qualitatively analyse the secondary data. A content analysis also led to the formulation of qualitative test questions that may be used to generally determine whether an SPV structure transaction is Shari’a compliant or not. Out of ten Islamic banks covered in this research, eight of them engage in investment transactions. Out of these eight Islamic banks, evidence tends to suggest that five Islamic banks include conventional loans within their SPV investment structures for genuine causes, while three Islamic banks use hiyal (legal stratagems) to engage in prohibited conventional activities through SPVs. This indicates that although SPVs may be used for genuine causes, there may be some sort of an abuse of SPVs by the Islamic banking industry to override Shari’a (Islamic law) requirements. Also, whether the practice was genuine or hiyal-based, evidence further tends to suggest that many SPV practices in the Islamic banking industry may have been violating at least one major Shari’a condition, which therefore negates the Shari’a compliance of the SPV transactions. This includes Islamic banks either: (1) indirectly paying for the establishment costs of the conventional SPVs, (2) managing the conventional SPVs, (3) negotiating conventional deals on behalf of the SPVs, (4) having legal control over the conventional SPVs, and/or (5) having influence over the conventional SPVs. According to the findings, the conditions that are being violated are placed by Shari’a Supervisory Boards unanimously, in one form or another. This raises a question of whether a flaw exists within the Islamic banking industry, where such violations were able to have continued without being spotted by regulators, Shari’a Supervisory Boards, and/or internal Shari’a reviewers. The research concludes that there seems to be a discrepancy between the Islamic banking theory and practice, where the theory strictly prohibits interest-based transactions, while the practice commonly includes interest-based transactions. The research further concludes that evidence suggests that due to several factors, such as the inability to spot violations or management pressure, a considerable number of internal Shari’a reviewers do not report these SPV violations. As a result, most Shari’a Supervisory Boards are not officially informed of the realistic practices taking place.

This study examines what drives the risk appetite of US banks to use credit derivatives to mitigate risk, the potency and impact of the instruments on bank portfolio management and performance. Panel data covering the period of 2002 to 2011 was employed and segmented into three phases (pre-crisis, crisis and post-crisis). The techniques used for analysis were Random Effects Logistic Regression and Arellano-Bond Dynamic Data Generalised Method of Moments. Findings showed that during the pre-crisis period, banks used the instruments more for trading than for hedging, expanding their level of risk taking. The use of the instruments was subdued during the crisis period, and was used more for hedging purposes due to the heightened state of uncertainties, anxieties and shocks. For post-crisis, banks returned to their trading rather than hedging to improve profitability. Further findings revealed that pre-crisis, the connection between the employment, application of credit derivatives and bank portfolio performance was generally significant as banks with credit derivatives activities outperformed other banks. At the full length of the crisis period, banks restructured their portfolios to reflect asset write-downs and a subdued demand for the instruments thus affecting portfolio returns significantly. Post-crisis period saw the gradual responses to the reforms in the market place though returns were not at the level of the pre-crisis period as everything was still in a wobbling mode. Furthermore, moral hazard was also identified as one of the reasons for the lapses which led to the crisis and thus bank portfolio performance. This study concludes that credit derivatives do affect bank portfolio persistence, risk and return for the three periods whether in a capacity of a beneficiary or as a guarantor. Banks would need to re-examine their instruments to get them on a sustainable path as well as attract portfolio flows and growth.

This thesis looked at the development of the role of the bank branch manager since the 1960s with the purpose of shedding light on the nature, drivers and impact of the transformation of British branch banking in this period. The analysis was based on interviews with former branch managers and revealed that the role of the branch manager as a skilled, authoritative and autonomous craftsman balancing the needs of customers, staff and the bank was increasingly coming under threat from the late 1970s onwards. The branch manager lost a great deal of authority and responsibility for customer outcomes through the introduction of credit scoring and through the removal of business lending from branches. Further, the introduction and intensification of targets reduced his or her discretion and autonomy. Although it is implicit in much of the literature, the original contribution of this thesis lies in its conceptualisation of the depersonalisation, the move from case-to-case judgements to rule-bound impersonal decisions, and the disembedding of banking, the detachment of service provision from social networks, by drawing on Weber, Granovetter, Giddens and Luhmann. Importantly, the agency of branch managers as gatekeepers, which lies at the intersection of skill, authority and autonomy, is central in making services embedded and personalised. It is argued that the progressive liberalisation of financial markets had a dual impact on banking and the role of the bank branch manager. First, it led to the depersonalisation of banking and the disembedding of the bank branch from local communities and customers. Second, financial liberalisation deskilled and disempowered the bank branch manager. The demise of the traditional bank branch manager through these dynamics changed the role of branches from originators of financial services to retail outlets for centrally branded, designed and controlled products.