<p> The operating landscape for banks and other financial institutions continues to change as massive law is implemented. This, coupled with advances in technology, has greatly increased consumer power. To remain compliant and competitive, financial services organizations must adapt to these environmental variations and continually renew their strategic orientations. To gain competitive advantage, organizations must learn faster than their competitors. Interpreting the environment and charting a path for the future is a function of leadership. However, our understanding of leadership's role in developing an organizational learning capability is limited. </p><p> The purpose of this qualitative single-case study was to describe leadership's influence on the subsystems that support an organizational learning capability within a U.S. financial services firm. The case involved a 107-year old financial institution in the Northeastern region of the United States. Using Marquardt's (2011) Systems Learning Organization Model as an analytic frame, a descriptive model of influence emerged via document review, direct and participant observation, and 21 semistructured interviews. </p><p> Through analysis of influence on the subsystems of organization, people, learning, knowledge, and technology, 10 findings contributed to four study conclusions: (1) leadership perceptions of organizational learning are supported with congruent action, (2) leadership's ability to manage tensions contributes to a robust organizational learning capability, (3) leadership drives adaptive social structuring that enhances all five subsystems, and (4) leadership encourages relational dialogue that supports the interdependency of organizational subsystems. </p><p> Answering a call for greater understanding of leadership's role in organizational learning (Crossan, Maurer, &amp; White, 2011; von Krogh, Nonaka, &amp; Rechsteiner, 2012), this research highlights the nature of relational leadership. Additionally, the data suggest that Marquardt's (2011) Systems Learning Organization Model may be enhanced by adding dimensions of regulators and vicarious learning to the people and learning subsystems, respectively.</p>

Why did different countries create different systems of banking regulation in the years leading up to the recent global financial crisis, despite adhering to the same transnational regulatory agreement, the 1988 Basel Capital Accord? Using over 5000 pages of archival material and in-depth interviews with regulators and industry participants, I answer this question by tracing the historical development of banking regulation (1780-2007) across three countries that were all parties to the Basel Capital Accord: the U.S., Canada, and Spain. The conventional wisdom is that banking regulation either follows universal principles of efficiency or reflects the power and interests of the regulated industry. I offer a very different explanation: that regulators from different countries adopted different policies because they subscribed to fundamentally different conceptions of economic order, which can be traced back many decades in each country. / Sociology

The following investigation is intended to determine how the large-cap US multinational corporation was further advanced during the pivotal years of 1895-1913 by a leading private unincorporated institution—House of Morgan. Historical review and assessment focused on the broader US society, government, monetary landscape, the House of Morgan, leading large cap US multinationals; looking at both the key organizations and underlying people in power. The report framework focuses upon the development of the US super structure within which all major companies work down to the way actual institutions organize economic assets in the form of a multinational corporation. Questions that have been considered include: how was business conducted globally with so little formal mechanisms in place, the importance of the various forms of capital for business, and the various roles politics played in business development. Other areas include how owners and managers were effectively separated, how these same companies were able to branch out its product offering and the importance of providing corporate incentives. The House of Morgan cooperated with leading merchant banks, governments, foundations in developing an over-arching environment that was better adapted to the realities of the recent agricultural, industrial, and transportation revolutions that had brought about an integrated world. To organize economic assets in a more efficient and stable manner, large-cap multinationals were the preferred alternative, with a wave of consolidation across industries, underpinned by the pristine Morgan name. Strong board presence, interlocking corporate representation, active role in strategic planning, and management selection ensured that not only were new corporations molded in the design of the House of Morgan but also that they would stay committed to the far-reaching objectives. The House of Morgan took on more than just a focus of increasing shareholder value. They were driven by lofty ambitions of providing comprehensive stability within society at large in a rapidly changing world. The partners of the House of Morgan families had for generations been at the vanguard for providing the highest level of leadership throughout society in areas including business, politics, finance, and religion. These leading families were instrumental in providing the backbone of American society including founding the US Republic, developing the most venerable education institutions, and providing a moral compass through religious revival movements. The House of Morgan would help bring about generally larger and more institutionalized solutions from preceding generations that were conducive for multinational corporations to operate within. This ranges from a US central bank, developing modern non-profits structure, and funding the transportation network making the world more integrated. In helping organize broader US society, the House of Morgan would interlock different subsystems, including finance, charity, and politics with business in promotion of a more harmonious, predictable and productive society. The House of Morgan development of leading US large-cap multinationals, including General Electric, International Harvester, International Mercantile Marine and US Steel illustrates how it not only provided for the macro landscape to operate within, but also developed the leading companies of the era.

This thesis investigates the importance banks, and bankers had with the development of the Denton County Texas from the 1870s until the beginning of the Second World War. Specifically, their role in the formation of both private and public infrastructure as well as the facilitation towards a more diverse economy. Key elements of bank development are outlined in the study including private, national, and state bank operations.

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This study examines how diversification changes firms' key characteristics, which consequently alter firms' value. The reason why I focus on this topic is because of the mixed findings in literature about the valuation effect of diversification. This study offers deeper insights to the influence of diversification on important valuation factors that are already identified in finance literature. Specifically, it examines if diversification affects firms' information asymmetry problem, firms' cost of capital and cash flow, and firms' production efficiency. The study looks at both the financial industry and non-financial industry and the chapters are arranged in the following order. Firstly, empirical studies show that investors do not value BHCs' pursuit of non-interest income generating activities and yet these activities have demonstrated a dramatic pace of growth in the recent decades. An interesting question is what factors drive the discontent of the investors with the diversification endeavors of the BHCs in non-interest income activities. The first chapter examines the subject from the view point of information opaqueness, which is unique in the banking industry in terms of its intensity. We propose that increased diversification into non-interest income activities deepens information asymmetry, making BHCs more opaque and curtailing their value, as a result. Two important results are obtained in support of this proposition. First, analysts' forecasts are less accurate and more dispersed for the BHCs with greater diversity of non-interest income activities, indicating that information asymmetry problem is more severe for these BHCs. Second, stock market reactions to earning announcements by these BHCs signaling new information to the market are larger, indicating that more information is revealed to the market by each announcement. These findings indicate that increased diversity of non-interest income activities is associated with more severe information asymmetry between insiders and outsiders and, hence, a lower valuation by shareholder. Secondly, since Lang and Stulz (1994) and Berger and Ofek (1995), corporate literature has taken the position that industrial diversification is associated with a firm value discount. However, the validity and the sources of the diversification discount are still highly debated. In particular, extant studies limit themselves to cash flow effects, totally overlooking the cost of capital as a factor determining firm value. Inspired by Lamont and Polk (2001), the second chapter examines how industrial and international diversification change the conglomerates' cost of capital (equity and debt), and thereby the firm value. Our empirical results, based on a sample of Russell 3000 firms over the 1998-2004 period, show that industrial (international) diversification is associated with a lower (higher) firm cost of capital. These findings also hold for firms fully financed with equity. In addition, international diversification is found to be associated with a lower operating cash flow while industrial diversification doesn't alter it. These results indicate that industrial (international) diversification is associated with firm value enhancement (destruction). Given the fact that the majority of the firms involved in industrial diversification also diversify internationally, failing to separate these two dimensions of diversification may result in mistakenly attributing the diversification discount to industrial diversification. Thirdly, financial conglomerates have been increasingly diversifying their business into banking, securities, and insurance activities, especially after the Gramm-Leach-Bliley Act (GLBA, 1999). The third chapter examines whether bank holding company (BHC) diversification is associated with improvement in production efficiency. By applying the data envelopment analysis (DEA), the Malmquist Index of productivity, and total factor productivity change as a decomposed factor of the index, are calculated for a sample of BHCs over the period 1997-2007. The following results are obtained. First, technical efficiency is negatively associated with activity diversification and the effect is primarily driven by BHCs that did not diversify through Section 20 subsidiaries before GLBA. Second, the degree of change in diversification over time does not affect the total factor productivity change but is negatively associated with technical efficiency change over time. This latter effect is also primarily shown on BHCs that did not have Section 20 subsidiaries before GLBA. Therefore, it can be concluded that diversification is on average associated with lower production efficiency of BHCs, especially those BHCs without first-mover advantage obtained through Section 20 subsidiaries. These chapters explores the possible channels through which diversification could alter firms' valuation. They contribute to the literature by offering further knowledge about the effect of diversification. / Business Administration

The syndicated loan is become more and more important for firm's financing. We study three important aspects of loan syndication: the lead arranger's reputation effect on syndicated loan pricing, the switching behavior for repeat syndicate loans and the effect of country-specific bank-firm ownership structure on syndicated loan pricing and bank-firm relationship of repeat loans. The first chapter analyzes the reputation effect of the lead arranger on syndicated loan pricing, based on a sample of loan facilities to non-financial U.S. firms over the 1994-2006 period. Theory suggests that the reputation/spread relationship should generally be positive because more reputable lenders usually employ more costly loan screening and monitoring techniques and therefore must be compensated with a higher spread. After controlling for endogeneity in lender-borrower matching, the empirical results show that the reputable arrangers charge a "reputation premium" for monitoring and due diligence, and the commitment against extracting the information rent from borrowers. The results also show that the less-reputable arrangers offer a "reputation discount", since the market competition from both the loan market and bond market makes it more difficult for less reputable arrangers to sustain the reputation mechanism. In addition, the reputation effect on pricing becomes less significant when the borrower enters a repeat loan relationship with a prior or existing lender. Finally, the study finds that the arranger's reputation can reduce the lead share retained by the lead arranger in its loan portfolio, which serves as evidence that reputation also mitigates the information asymmetry between the lead arranger and participant banks. The second chapter analyzes the switching behavior for two types of repeat loans: migrating loans that remain within the same bank reputation class and loans migrating to a different reputation class. The theoretical literature argues that banks (lenders) and firms (borrowers) benefit from entering into a relationship-lending arrangement. In the syndicated loan market, however, it is very common for repeat loans to switch from one bank to another. We present a model that establishes conditions for implementing empirical investigations relating to relationship lending and the characteristics of the separating equilibrium in the loan market. Using explanatory variables describing firms, loans, and loan syndicates, we find that lending within the high quality bank sector reveals evidence that is consistent with relationship lending. That is, some firms forego longer maturity loans and less oversight to remain with their original lender. A similar finding does not hold for repeat lending in the lower quality bank sector. Regarding loans that migrate in either direction between the high and low quality banking sectors, firm risk is the most important determinant. Relatively riskier firms move down to lower quality lenders while relatively safer firms move up to higher quality lenders. The third chapter investigates the determinants of loan pricing and repeat loan relationship for a sample of 6,180 non-U.S.. firm-loan observations for the period 1998-2007. This paper focuses on the relation between a country-specific governance indicator and country-specific bank-firm ownership structures on loan pricing and the management of a lending relationship between the syndicate bank and firm. We evaluate the relationship between country-specific bank ownership structure and the main characteristics of loan, which are mainly measured by loan pricing and loan switching decision. The paper examines three interrelated questions: 1.How is loan pricing affected by country-specific bank-firm ownership structure? 2. Does country-specific bank-firm ownership structure influence the decision to switch lenders in the repeat loan market? 3. Is country-specific bank-firm ownership structure more important for a borrower to migrate to a higher reputation lender than to a lower reputation lender? We use loan-characteristic, bank-characteristic, and firm-characteristic variables as well as country-specific corruption and country-specific bank-firm ownership structure variables to explore the effect on loan pricing and loan-switching decisions. Using logistic regression analysis, we find that loan switching is less likely for firms when the bank controls the firm, especially in the case of a bank-controlled firm borrows from a low reputation syndicated loan lender. However, when the firm controls a local bank, there is no impact on the firm's switching decision in the syndicated loan market. The bank-controlling firm is as likely to switch as a firm that does not control a bank even though the firm is more opaque to the financial market. Our results suggest that in the international syndicated loan market, the bank-firm relationship is partly shaped by country-specific characteristics and information asymmetry of firms to the financial market. These chapters explores the bank and firm behavior in the syndicated loan market and make the contribution to the literature by offering further knowledge and deeper understanding about the bank-firm relationship and behavior in the loan syndication structure. / Business Administration

<p> The fast and easy global movement of capital throughout the financial system, from lenders to borrowers and through intermediaries and financial market participants, has been recognized as a source of instability associated with illiquidity and financial crises. The purpose of this research was to better understand how regulation either enables or constrains capital movement. The theoretical framework comprised 2 contrasting public policymaking models, Arrow's rational-comprehensive model and Kingdon's garbage can model, which were used to derive opposing hypotheses. The research question addressed the nature of the relationship between Credit Default Swaps (CDSs) regulations and the flow of capital into Collateralized Mortgage Obligations (CMOs) when lenders share their borrower-related loan risks through intermediaries with other market participants. This quantitative study was a quasiexperimental time series design incorporating an autoregressive integrated moving average (ARIMA) model using secondary data published by the U.S. government. The 2 independent variables were regulatory periods involving 2 CDSs regulations and the dependent variable was capital in the U.S. financial system that is deployed to CMOs. The Commodity Futures Modernization Act of 2000's ARIMA model (1,2,1) was significant at <i>p</i> &lt; .05 and was negatively correlated to the Emergency Economic Stabilization Act of 2008's ARIMA model (1,1,0), <i>r</i> = -.91, <i>n</i> = 18, <i>p</i> &lt; .001. These results suggest that regulations cannot be relaxed and then reinstated with predictable results. The potential for positive social change is from stable financial institutions that mutually benefit depositors and borrowers.</p>

The implementation of neo-liberal policies in Mexico during the administrations of Miguel de la Madrid (1982-1988) and Carlos Salinas de Gortari (1988-1994) severely impacted the rural sector, especially areas of rainfed agriculture. In the framework of these policies, the institutional services provided by key state institutions in terms of technical assistance, crop insurance and agricultural credit was significantly diminished In light of such situation, farmers (especially low-resource farmers) were faced with great difficulties to carry out their agricultural activities. Their situation called for definition and implementation of new alternatives to provide the necessary means to return services to the countryside One of these alternatives was the foment of local organizations to provide credit services, mainly in the form of credit unions. This type of financial institution grew despite the obstacles created by certain public institutions (i.e. The National Bank and Stocks Commission-CNBV) which continuously increased the capital base legally needed to constitute a credit union One credit union that was created in the midst of this process in 1992 was the Union de Credito Mixta 'Plan Puebla-UCMPP.' The UCMPP is comprised of more than 3000 members and operating 8 branches in 12 Mexican States This study describes and analyzes the UCMPP experience, from its early stages of organization to its current situation. The underlying principle of this study is the contention that joint efforts by institutions of higher learning (Colegio de Posgraduados) and Mexican campesinos to provide rural populations with affordable credit is a viable alternative for (furthering) development in rural Mexico The investigator utilizes several methodological approaches to collect and analyze data. To collect information he relied on archival research and fieldwork using surveys, case study guides and focus groups. To analyze the data he uses primarily qualitative methods / acase@tulane.edu