This thesis investigates the impact of accounting standard IAS39 on banking institutions in Greece and the UK.  It specifically addresses preparers’ perceptions of that standard’s effects on the banking books of banks. The research involves a mixed methodology, namely: (i) a survey analysis of the perceptions of banking practitioners in Greece and the UK, in order to identify the standard’s impact on the banking sector as well as to gauge the standard’s acceptance of banks, in order to facilitate a deeper understanding of the implications of the standard for their organisations.  ‘Elite’ interviews also advocate that such high powered individuals are the key holders to privy information. The results suggest that IAS39 is a highly controversial standard that introduces concerns not only for the banks’ valuation of assets and liabilities but also regulatory concerns over issues of policy formulation and stability.  Generally, bankers are negative and largely sceptical of the standard, on the grounds of relevance and reliability.  They do not view the standard as particularly useful, relevant, reliable or transparent for banking disclosures and financial stability when compared to the current mixed methodology approach followed currently for the valuation of assets and liabilities in the banking books of banks.  Most concerns revolve around the standard’s effects on valuation of assets and liabilities, provisioning and hedging issues and bank capital management for regulatory capital purposes. In the introduction of accounting standards attention should be paid to the nature of the industry and the system (i.e. credit versus market-based) in which firms operate, as well as to establishing particular methodologies.  It touches upon a contemporary issue of critical topical and international interest, of how accounting information standards relate to the systemic, operating, credit, market and liquidity risks of a modern, internationalised banking system.

M.Phil. / The Motraco transmission system is a classical case illustrating the increase in power transfer of a network considering the possibility of a voltage collapse. This case study was used in the dissertation to find a techno-economical solution for the Motraco system to increase the power transfer to satisfy an additional load. The Motraco power system is operating close to a voltage collapse at present. A voltage collapse will be experienced if additional load is added at the Maputo substation. The possibility of a voltage collapse can be reduced if the power transfer capability of the Motraco power system is increased. Various technologies can be used to increase the power transfer of the Motraco power system. The technologies used in this study to increase the power transfer were limited to the following: • Adding shunt capacitor banks at critical locations in the network • Adding a series capacitor bank on an existing 400 kV transmission line • Adding an additional 400 kV transmission line • Adding a series capacitor bank on the new 400 kV transmission line The correct use of the combination of the shunt capacitor banks, series capacitor bank and the new transmission line contributes to: • support voltages in the network; • reduce the transmission losses; and • increase the fault levels at the receiving end. The principles used in this dissertation can be used to increase the power transfer limit of any power system with the same characteristics.

The purpose of this research is to recommend a set of comprehensive management plans to guide the establishment and operation of work measurement programs in commercial banks.

vi Abstract The thesis investigates the linkages between macroeconomic performance and banks loans portfolio quality represented by the non-performing loans ratio in the Czech banking system in years 2003-2013. The empirical analysis evaluates how banks non-performing loans are influenced by several macroeconomic indicators such as GDP, inflation, interest rate, unemployment rate and exchange rate. First we investigate loans quality on the aggregate level, next we analyze the quality of loans of households and non-financial corporations sector separately as the macroeconomic variables may affect these two sectors of borrowers differently. Finally the analysis of mutual links is done for different loan categories according to the level of failure also. The empirical results from vector autoregression model and impulse response analysis generally suggest that favorable macroeconomic conditions improve banks loans quality by lowering the non-performing loans ratio and vice versa. The thesis also identifies the feedback effect of increasing non- performing loans ratio on economic performance. Keywords: banks loans quality, macrofinancial linkages, non-performing loans, Czech banking system

Bank profitability is one of the key inputs for macroprudential surveillance. Although we may find extensive empirical literature analyzing banks' performance, there is to our knowledge no study examining whole banking sectors. This thesis contributes to the existing research twofold. Firstly, we develop a banks' income model that considers banking sectors as a whole, using a sample of 40 countries in the period of 1997 to 2011. Secondly, we implement this model to two different restrictions of our data sample testing the model's applicability. We explore three hypotheses. Firstly, we test whether macroeconomic, industry-specific and bank-specific determinants are significant drivers of bank profitability. The final banks' income model is estimated via a dynamic GMM specification, consisting of proxies for the level of economic development, capitalization, interest-earning activities, credit quality and two lags of profitability capturing its persistency. The hypothesis is rejected since we do not find evidence of a significant industry-specific indicator. The second and third hypotheses restrict our sample to a time period before the financial crisis and banking sectors comprising only commercial banks, respectively. We conclude that the model is robust with regards to the chosen time period but...

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M.Com. (Financial Management) / It has been argued that inadequate credit risk management practices and high levels of credit risk was the cause of the 2007 to 2009 global financial crisis, as well as the banking crises over the two past decades, including the 1997 East Asian crisis. As a result, banks have increasingly prioritised credit risk management to ensure acceptable levels of profitability and to keep them from collapsing. However, research on the relationship between credit risk management and profitability in banks in South Africa remains limited. Therefore, this study addressed the question of whether credit risk management has an effect on profitability in South Africa’s four major banks. A quantitative approach was used to establish the relationship between profitability, represented by return on equity (ROE), and credit risk management, represented by two variables, namely capital adequacy ratio (CAR) and the non-performing loans ratio (NPLR). Secondary data for the years 2002 to 2013 was analysed using panel regression and the study concludes that not only does credit risk management have an effect on profitability in South African banks, but that bank size, operating expenses and economic growth also affect the profitability of South African banks. These findings would enable the enhancement of profitability in South Africa through constantly improving credit risk management practices and policies, and by addressing other factors that can negatively affect profitability.

M.Com. (Financial Economics) / This study analyses the existence of a bank lending channel in South Africa and investigates the impact of the securitisation activity on the effectiveness of the bank lending channel during the period 2001–2010 using data from the South African banking sector. Structural Vector Auto Regression (SVAR) and Structural Vector Error Correction Model (SVECM) methods are used to interpret the impulse responses of bank lending to structural shocks (monetary policy) and to securitisation. The conclusion is that the bank lending channel is present and efficient in South Africa during the sample period with a lag and that securitisation acts as a shield against monetary impulses by constituting an additional source of funding for banks.

Le résumé en français n'a pas été communiqué par l'auteur. / In this paper, I study the effect of risk-free rate shocks on firms that are exposed to interest rate risk. To examine their influence on the firms’ investment behaviours, I define an interest rate exposure, which is measured by the total floating debt, so that the impact of interest rate shocks on firms can be measured by the product of the interest rate exposure and the change in the interest rate. Using the Compustat data from 1974-2012 and the US annual fundamental financial data, I firstly find that the firms, which are exposed more to interest, have more sensitive cash flows of interest payments and retained earnings. Secondly, I find that exposed firms’ investment behaviours are sensitive to the interest rate shocks as well: the higher the exposure to interest rate risk, the more the firms would react to interest rate shocks. Furthermore, I show that financially constrained or high-leverage firms are more sensitive to interest rate shocks than financially non-constrained or low-leverage ones. Interestingly, I find that the fact that firms have different reactions to the interest rate shocks of different signs also works for R&D policies. Finally, I show that the model structure changes a lot after the 2008 financial crisis. We study the reactions of insurance companies to the unexpected interest shocks, which are defined by using the level and the slope of future contract interest rates. We find that on average, insurance companies have significantly positive abnormal returns following a positive unexpected shock in the level or the slope of interest rates: a 1% increase in the level or the slope of interest rates will increase the abnormal returns on average by 2.59% and 1.63%, respectively. We also find that insurance firms engage in maturity transformation in the opposite direction of banks: insurance companies, whose long-term debts will maturate in a very long term, will benefit from the increase in interest rate slope shocks rather than banks’ riding on the yield curve through a large mismatch between assets and liabilities. The empirical results provide important policy implications: interest rate shocks boost the value of insurance equities, with a decreasing effect on life, property & causality, and multi-line, but not for the reinsurance or insurance brokers. I investigate how the 2011 and 2014 EU stress tests affect the risk-taking of Euro-pean banks. I document a non-monotonic relationship between banks’ risk-shifting resulting from regulatory arbitrage and the tightness of their capital constraint (i.e., the distance between their ex-ante capital ratio and the regulatory level): banks with capital ratios marginally above the regulatory level do more regulatory arbitrage than banks with a level of capital ratio significantly below or above the regulatory level. I also study the indirect effect of the tests on the financing costs of banks which are excluded from the tests: their financing costs on the corporate bond market increase with the level of negative information released in the country in which they are located.

The Basel III accord is the cornerstone of global financial reform efforts that seek to guard against the types of financial crisis seen in 2007/8. It requires banks to fund more of their activities with better-quality capital and, in so doing, attempts to assure that they are better able to absorb shocks that can lead to crises. However, capital requirements come with a range of costs, which could spark a slowdown in credit or a change in the types of lending banks engage in. This paper conducts a comprehensive literature review of theoretical and empirical studies of the impacts of previous Accords, Basel I and Basel II, and attempts to draw lessons on possible downside effects of the latest iteration of the Basel Accord. It proceeds in three parts. Part 1 explores the history of the Basel Accords, exploring their theoretical basis and the evolution of the regulation into its current form. This section identifies two possible mechanisms by which capital regulation can negatively impact the broader economy: increasing capital costs and increasing risk aversion. Part 2 explores the potential for increased capital cost, while Part 3 examines the possibility of excessive risk aversion. In conclusion, the paper finds that while the potential for downside effects does exist, these are not likely to be significant, and seem particularly unlikely to have a major impact in the South African case.