Examining the Indonesian dual banking system: an exploration of market discipline indicators

IF 1.8 Q2 BUSINESS, FINANCE

International Journal of Managerial Finance Pub Date : 2024-09-19 DOI:10.1108/ijmf-01-2024-0004

Nurhastuti Kesumo Wardhani, Robert Faff, Lewis Liu, Zairihan Abdul Halim

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引用次数: 0

Abstract

Purpose

This research aims to investigate the disciplinary functions of depositors and subordinated debt holders within Indonesia's dual banking system, examining the impact of regulatory changes on market discipline.

Design/methodology/approach

The study employs a comprehensive analysis of the dual banking system in Indonesia over 15 years. Utilizing a non-public dataset from the Financial Services Authority and the Indonesia Deposit Insurance Corporation, the study employs propensity score matching and difference-in-differences analysis.

Findings

The findings reveal distinct patterns in the exercise of market discipline by depositors over different regulatory regimes. During the blanket guarantee regime (2002–2005), depositors lacked the incentive to monitor banks but resumed their disciplinary role under the limited guarantee regime (2005–2017). Islamic banks faced simultaneous market and regulatory discipline, with market discipline prevailing.

Originality/value

This study contributes to the literature by providing novel insights into the interplay between regulatory changes, market discipline and depositor behavior within Indonesia's dual banking system. The utilization of a comprehensive non-public dataset from regulatory authorities adds to the originality of the research.

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印度尼西亚双重银行体系研究：市场纪律指标探索

目的本研究旨在调查印尼双重银行体系中存款人和次级债持有人的约束功能，研究监管变化对市场约束的影响。研究利用了金融服务管理局和印尼存款保险公司的非公开数据集，采用了倾向得分匹配和差异分析方法。研究结果研究结果显示，在不同的监管制度下，储户执行市场纪律的模式各不相同。在全面担保制度（2002-2005 年）期间，储户缺乏监督银行的动力，但在有限担保制度（2005-2017 年）期间，储户恢复了其约束作用。伊斯兰银行同时面临市场纪律和监管纪律的约束，其中市场纪律占主导地位。原创性/价值本研究对印尼双重银行体系中监管变化、市场纪律和储户行为之间的相互作用提供了新的见解，从而为相关文献做出了贡献。利用监管机构提供的全面的非公开数据集增加了研究的原创性。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

International Journal of Managerial Finance BUSINESS, FINANCE-

CiteScore

4.10

自引率

0.00%

发文量

期刊介绍： Treasury and Financial Risk Management ■Redefining, measuring and identifying new methods to manage risk for financing decisions ■The role, costs and benefits of insurance and hedging financing decisions ■The role of rating agencies in managerial decisions Investment and Financing Decision Making ■The uses and applications of forecasting to examine financing decisions measurement and comparisons of various financing options ■The public versus private financing decision ■The decision of where to be publicly traded - including comparisons of market structures and exchanges ■Short term versus long term portfolio management - choice of securities (debt vs equity, convertible vs non-convertible)