Banking services in saudi arabia research proposal The WritePass Journal

Banking services in saudi arabia research proposal Literature Review Banking services in saudi arabia research proposal Literature ReviewI.  IntroductionII.  Lending Institutions in Saudi Arabia  III. Regulatory Framework of Banking System in Saudi ArabiaIV. Improvement of Banking ServicesVI. Service Quality in Saudi Arabian BanksVII.  Technology Use in Banking Service ProvisionRecommendationsReferencesRelated Literature Review I.  Introduction The beginning of the modern banking system began in October 1952 with the creation of the Saudi Arabian Monetary Agency (SAMA) the principle agency responsible for management of monetary matters. Paper money was first introduced in the early years of the 1950s decade. Banking problems in the late 1950s decade resulted in regulatory framework being strengthened in Saudi Arabia during the middle 1960s decade in which broad supervisory capacity was given to SAMA in a legal environment that upheld the concept of a Universal Banking Model allowing banks to make provision of a wide range of financial services â€Å"including banking, investments, securities, etc. through their branches.† (Saudi Arabian Monetary Agency, 2004, p.3) There were 12 operating banks by 1979 only three of which, were non-Saudi banks and branches had doubled by that year to 140. II.  Lending Institutions in Saudi Arabia Five major lending institutions were introduced in the decade of the 1970s: (1) Saudi Credit Bank; (2) Saudi Agricultural Bank; (3) Public Investment Fund; (4) Saudi Development Fund; and (5) the Real Estate Fund. (Saudi Arabian Monetary Agency, 2004,  Ã‚  Ã‚   p.3) Restructuring was accomplished arising from encouragement by the Saudi Government and by 1975 there was a reported â€Å"10 international bank†Ã¢â‚¬ ¦including â€Å"29 branches present.† (Saudi Arabian Monetary Agency, 2004, p.3) There was a rise and fall in the economy and SAMA faced a critical challenge for supervision in 1982 â€Å"when irregularities appeared in Saudi Cairo Bank’s operations. Two senior managers were involved in unauthorized trading in bullion during the 1979-81 period, and had concealed accumulated losses that exceeded the Bank’s share capital.† (Saudi Arabian Monetary Agency, 2004, p.3)   It is reported that SAMA required the Bank to issue new shares and doubl e its capital in 1986. SAMA arranged this increase to be taken up entirely by the Public Investment Fund (PIF). The Bank also benefited from â€Å"low-cost† deposits from the Public Investment Fund. These measures helped the Bank with liquidity and rescued it back to a healthy position.† (Saudi Arabian Monetary Agency, 2004, p. 4-5   III. Regulatory Framework of Banking System in Saudi Arabia SAMA in collaboration with Saudi Arabia Ministry of Finance ensured the financial system’s stability and assisted banks in clearing the hurdles of economic downturn. Included in this collaborative initiative were the following actions: (1) Banks were required to seek SAMA’s approval prior to announcing their dividends. The Banking Control Law required all banks to build their statutory reserves equal to their share capital. SAMA further encouraged Saudi banks to build additional reserves to strengthen their capital base. (2) Most foreign shareholders in Saudi banks enjoyed a tax holiday for the first five years of their ownership. To encourage retention of profits, the tax holiday was extended in most cases by another 5 years after which a deferred tax scheme was permitted; (3) In 1986, SAMA obtained a ruling from the Tax Department that permitted the tax deduction of loan loss provisions on   an accrual basis. This encouraged banks to increase their loan loss provisi ons for doubtful accounts; (4) To encourage Saudi banks to increase their inter-bank dealings and to support the development of a riyal inter-bank market, a tax ruling was obtained which exempted foreign banks from withholding taxes when carrying out inter-bank transactions with Saudi banks; (5) Corporate Governance.   SAMA recognized the need to encourage banks to take strong steps to improve their risk management and control procedures. Consequently, it took major initiatives in the area of corporate governance. Firstly, it required all banks to develop and strengthen their internal audit departments, and secondly it issued minimum internal control guidelines.   In addition, SAMA issued accounting standards for Commercial Banks in Saudi Arabia which were in line with International Accounting Standards; (6) Creation of Banking Disputes Committee. In 1987, Saudi authorities established a Banking Dispute Committee by the order of the Council of Ministers.   The creation of this Committee as the only relevant quasicourt to handle dispute between banks and their customers significantly strengthened the legal system.   By law, all banking disputes had to be referred to this Committee and the rulings of this Committee were given the same enforcement support as decisions from any other court; (7) Exchange of Information on Large Borrowers and on Delinquent Loans. In the early 1980’s, SAMA established a credit information service that provided information to Saudi banks on all large exposures of the Banking System.   This enabled banks to better assess the credit position and risk of big borrowers.   Also in 1986, SAMA permitted banks to exchange information on delinquent borrowers as a means of applying collective pressure on them. These measures have proved quite effective in resolving problems of delinquent loans.† (Saudi Arabian Monetary Agency, 2004, p. 5-6) IV. Improvement of Banking Services Banking and financial services were improved during the early decade of the 1980s by technological advances and SAMA had acknowledged a decade earlier that there was not only a potential but as well as need to â€Å"enhance and strengthen the Saudi financial markets through greater investment in modern technology. It is reported that the primary objectives of this strategy were: (1) elimination of duplication of efforts and waste; and (2) development of a national infrastructure. (Saudi Arabian Monetary Agency, 2004, p. 7) Technology enhanced business services introduced included: (1) automated Cheque Clearing System (1986); (2) linking of Saudi Arabia with the SWIFT payment network; (3) introduction of a national Automated Teller Machine System enabling customers to access accounts from any machine in Saudi Arabia and from the major financial markets; (4) introduction of debit, credit and charge cards; and (5) introduction of Point-of-Sale terminals that link customers, traders and banks. (Saudi Arabian Monetary Agency, 2004, p.7) International Islamic Financial Institutions It is reported that International Islamic Financial Institutions are reported in the work of Memon (2007) entitled â€Å"Islamic Banking: Present and Future Challenges† to be making provision of â€Å"a wide range of services in accordance with the basic principles of Shariah. The products are reported to include: (1) Mudaraba; (2) Murabaha; (3) Musharaka; (4) Ijarah; (5) Isstina; and (6) Salam. (Memon, 2007, p.4)   Conventional banks are reported to operate under the concept â€Å"of lender-borrower relationship where interest is considered as the rental income on capital. The depositors are assumed to be capital providers.† (Memon, 2007, p.4) Bank customers are reported to be divided into three broad categories as follows: (1) religiously motivated customers; (2) high profit customers; and (3) customers who are religiously motivated but also expect returns at least similar to conventional banks. (Memon, 2007, p.6) It is reported as follows in regards to the Islamic economic system: â€Å"Islamic economics is a system, which not only fulfils our moral, ethical, and religious obligations but also demonstrates to be economically feasible and financially rewarding. Islamic banking is based on asset-based transactions for the purpose of income generation, and prohibits financing in all forms of economic activities, which are normally and/or socially injurious to the society.† (Memon, 2007, p.6) Additionally stated is that the Islamic field of Banking operations â€Å"is unlimited. It is under continuous process of evolving and Islamic financial modes instruments have been developed to cover nearly all kinds of businesses including consumer financing, project financing, house financing, working capital financing, import and export financing, venture capital, etc.† (Memon, 2007, p.6) A survey conducted in the United States indicates that U.S. banker perception of Islamic Banking includes that 10 out of 20 Islamic Banking practices are viewed as acceptable. Those ten include: (1) investment accounts; (2) transfer of funds; (3) cost plus finance; (4) profit and loss; (5) sharing, (6) trust financing, (7) leasing, (8) lease purchase, (9) letters of guarantee, and (10) flexible investment of deposit and role as trustees. (Memon, 2007, p.8) VI. Service Quality in Saudi Arabian Banks The work of Al-Fawzan (2005) entitled â€Å"Assessing Service Quality in a Saudi Bank† states that service quality is defined as â€Å"the degree of alignment between customers’ expectations and their perceptions of the service received.† (Al-Fawzan, 2005, p.1) Al-Fawzan (2005) states that the move to â€Å"†¦managed service has increased demands for outcome-based accountability, cost containment, and attention to customer-focused quality in order to remain competitive in a rapidly changing environment. This dual focus on driving down costs while increasing quality has intensified pressures to understand, measure, and manage quality from a customer perspective.† (p.101) While banking systems are stated to provide services that are the same they are differentiated by the quality of services provided. In addition, today’s customers are â€Å"†¦more aware of the alternatives and their expectations of service have increased. Service quality c an, therefore, be used as a strategic tool to build a distinctive advantage over competitors. Banks are striving for zero defection and retaining every customer that the company can profitably serve in order to achieve service excellence.† (Al-Fawzan, 2005) Zero defections makes a requirement of ongoing efforts for improving service quality. It is reported that while quality â€Å"can not be improved unless it is measured, it can be defined from several perspectives, e.g., the ability to satisfy the needs and expectations of the customer, or the totality of features and characteristics of a product or service that bears on its ability to satisfy given needs.† (Al-Fawzan, 2005) There is a growing acknowledgement of quality importance in banking services although â€Å"its conceptualization and empirical assessment have remained limited.† (Al-Fawzan, 2005) Al-Fawzan (2005) reports that the â€Å"central tenet of the quality paradigm is the importance of understand ing and utilizing customer data to drive operational and strategic decisions, defining quality from the outside-in based on customer information is critical. This shift in defining quality often necessitates a fundamental change in the way professionals, managers, staff, and policy makers think about and identify those who buy or use products and service.† (Al-Fawzan, 2005) Those who use banking services are not generally refers to as ‘customers’ but instead are referred to as ‘client† suggesting â€Å"†¦a passive voice in the service delivery process, which is reflected by professionals in the field who question the credibility of client evaluation of services. On the other hand, customer carries an image of an active participant with more input in determining choices and decisions. Clients of human service organizations who follow directions from professionals and make few demands on the system are labeled as cooperative. In contrast, customers in the business sector who are loyal to the service, interact with the staff, and are willing to show their preferences are viewed as desirable customer.† (Al-Fawzan, 2005) Al-Fawzan states that customers have difficulty in the articulation of â€Å"banking service quality† therefore â€Å"the recipient of the service can only really assess it, thereby making its mea surement more subjective than exact. Hence, the measurement of banking service quality has to be based on perceived quality rather than objective quality because services are intangible, heterogeneous and their consumption and production occur simultaneously.† (2005) It is reported that service quality   â€Å"†¦ is a measure of how well the service level matches customers’ expectations.† (Al-Fawzan, 2005) It is reported that Parasuraman et al. â€Å"†¦defined service quality as perceived by customers and items from a comparison on their expectations of the services they will receive with their   perceptions of the performance of the service provider.† (Al-Fawzan, 2005) The study reported by Al-Fawzan (2005) summarizes the results stated the following findings: (1) the most important dimension determined by Saudi Bank customers is that of ‘assurance dimension’; (2) a service gap exists in service quality provided by Saudi Banks w ith the most notable gap being the accessibility dimension; (3) Saudi Bank customers, on average, rated Saudi Banks service quality to be overall good; (4) the expectations of Saudi Banks by customers are â€Å"highest in reliability dimension; (5) 67.8% of SB customers rated the overall service quality as good and very good; (5) SB employees dress nicely and they are polite when talking to customers; (6) SB has exceeded customers’ expectations in performing the service right from the beginning and in instilling the confidence in customers that their transactions are complete and safe.† (Al-Fawzan, 2005) The work of Sohail and Shaikh (2008) entitled â€Å"Internet Banking and Quality of Service: Perspectives from a Developing Nation in the Middle East† reports a study that had as its objective the measurement of the quality of service from the perspective of the customer on internet banking in Saudi Arabia. The study was conducted via a questionnaire survey and an extensive review of literature. Findings in the study report that upon the basis of a factor analysis three factors were found to influence the evaluation of quality of internet banking services by users. Those three factors identified are stated to include: (1) efficiency and security; (2) fulfillment; and (3) responsiveness. (Sohail and Shaikh, 2008) In 2010 Jasimuddin reported in the work entitled â€Å"Saudi Arabian Banks on the Web† reports that commercial transactions via the Internet began in 1995 and that online banking is an application with much promise. However, while many banks in developed countri es have made provision of banking services via the Internet, Saudi Arabia is â€Å"lagging behind.† (Jasimuddin, 2010, p.1) The environment in the Kingdom of Saudi Arabia’s environment is very conducive to Internet banking service provision. Jasimuddin reports that as of 2000 there were 11 banks and 1201 branches operating in Saudi Arabia. As of the middle of 2000, there are 11 banks with 1201 branches operating across Saudi Arabia. Eight banks are reported to have established a web site presence which is a rate of 73% of banks with a web site presence although only two of these offer Internet Banking Services. When the Saudi banks web sites are compared there is not major difference noted in the content of the bank web sites. The contents of the websites are stated to be inclusive of information about the bank, the addresses of branches and ATMs, phone and fax numbers, press releases, newsletters, news about the site and welcome letters, hot links, job opportunities, publications, contact and email, feedback, sitemap, site search, online forms and so forth. (Jasimuddin, 2010, paraphrased) Practically all of the banks provide information relating to customer services that â€Å"incorporate financial market, retail and corporate banking, investment treasury service, telephone and PC banking.† (Jasimuddin, 2010) I t is reported that online banking in Saudi Arabia is still a â€Å"very marginal activity† and that internet is presently being used by Saudi banks primarily for â€Å"brand awareness and promotion.† (Jasimuddin, 2010) Saudi banks will be driven by â€Å"the dynamic and imperatives of e-finance†¦to build web site and to start Internet banking.† (Jasimuddin, 2010) In other words, since this is a banking service that is increasingly familiar customers will be requesting these services from banks in the future in Saudi Arabia. VII.  Technology Use in Banking Service Provision It was reported in 2007 that the National Commercial Bank of Saudi Arabia was established in Saudi Arabia prior to any other banks being established. This bank has 300 branches throughout the Kingdom of Saudi Arabia with some branches stated to be â€Å"dedicated exclusively to Islamic Banking Services. The National Commercial bank reports having implemented use of a digital signage system which is reported to make provision of a â€Å"better platform for NCB to better communicate with its employees, educating them about the banks products and services and enhancing the service they provide to their customers.† (Jasimuddin, 2010) Summary of Literature Reviewed It is clear that banks in Saudi Arabia are faced with a diverse customer-base and this makes a requirement of diversification of banking services offered by banks in the Kingdom. While internet banking services provision is somewhat behind the development in the rest of the world, it is certain that Saudi Arabian banking customers will clearly see the benefits to Internet banking and that the push will soon be on for provision of this banking service by Saudi Arabian banks. Internet banking as well as other technological advanced service possibilities are presently being explored by Saudi Arabian banks including such technologies as a digital signage system among others. While the banking sector is quite developed in the Kingdom of Saudi Arabia there does appear to be a general mistrust of Internet banking technology and not just on the part of customers but in the view of the banking industry in Saudi Arabia as well. Recommendations Arising from this study is a recommendation for research to be conducted examining the quality of banking service provision by banks in the Kingdom of Saudi Arabia with a focus on technology use.    References Memon, N.A. (2007) Islamic Banking: Present and Future Challenges. Journal of Management and Social Sciences. Vol. 3, No. 1, (Spring 2007) 01-10. Institute of Business and Technology (BIZTEK). Retrieved from: biztek.edu.pk/downloads/research/jmss_v3_n1/1-islamic%20banking.pdf A Case Study On Globalization and the Role of Institution Building in the Financial Sector Saudi Arabian Monetary Agency. February 2004. Retrieved from: sama.gov.sa/sites/samaen/OtherReportsLib/SK521-04(CaseStudyonGlobalization-RoleofInstitutionBuildinginSaudiArabia-Final)Dr.Shaukat.pdf Al-Fawzan, MA (2005) Assessing   Service Quality in a Saudi Bank. J. King Saud Univ., Vol. 18, Eng. Sci. (1), pp. 101-115, Riyadh (1426H./2005). Sohail, M.S. and Shaikh, N.M. (2008) Internet banking and quality of service: Perspectives from a developing nation in the Middle East. , Online Information Review, Vol. 32 Iss: 1, pp.58 72 Jasimuddin, Sajjad M. (2010) Saudi Arabianu Banks on the Web. Array Development. Retrieved from: tenso.fr/emarketing/wp-content/uploads/2010/05/Aper%C3%A7u-de-%C2%AB%C2%A0Saudi-Arabian-Banks-on-the-Web%C2%A0%C2%BB.pdf

How to Use the Italian Imperfect Subjunctive Tense

How to Use the Italian Imperfect Subjunctive Tense â€Å"If I were able to live in Italy for the rest of my life, I would be happy.† How do you express a sentiment like that in Italian? Before I dive into the nooks and crannies of the grammar with the subjunctive mood, here’s what that sentence would look like: Se io potessi vivere in Italia per il resto della mia vita, sarei contenta. In order to create this sentence on your own, you need to use the imperfect subjunctive (il congiuntivo imperfetto). You would use this tense when the main part of your sentence includes the present perfect tense (il passato prossimo), imperfect tense (l’imperfetto) or the conditional tense (​il condizionale) to talk about an unlikely hypothetical situation that starts with se (If) like â€Å"If I won the lottery† or to discuss wishful thinking. Some constructions that might help you understand when to use this are: Imperfect Tense ( Che) Imperfect Subjunctive Credevo che avessero ragione. - I thought they were right.Non era probabile che prendessimo una decisione. - It wasnt likely we would make a decision.Non cera nessuno che ci capisse. - There was no one who understood us.Il razzismo era il peggior problema che ci fosse. - Racism was the worst problem there was. Present Perfect Tense (Che) Imperfect Subjunctive L’ha aiutata affinchà © potesse imparare l’italiano. - He helped her so she could learn Italian.Abbiamo organizzato un riunione cosi’ da informare tutti sul da farsi. - We scheduled a meeting so we could brief everybody on what to do.Ho ritenuto giusto che mio figlio decidesse da solo quale universita’ scegliere. - I believed it was right my son could choose by himself which university pick out. Se Imperfect Subjunctive Conditional Se fossi in te, non mi fiderei di lui. - If I were you, I wouldn’t trust him.Se lui mi baciasse, sarei felicissima. - If he were to kiss me, I would be so happy.Se Mario mi invitasse a cena, accetterei subito! - If Mario asked me out for dinner, I would accept immediately! Conditional S e Imperfect Subjunctive Sarei felicissima se lui mi baciasse. - I would be so happy if he were to kiss me.Comprerei un guardaroba nuovo se io avessi tre mila dollari in pià ¹. - I would buy a new wardrobe if I had three thousand more dollars.Direi una bugia se dicessi che sono stata bene. - It would be a lie if I said I’ve been great. Magari (If Only) Imperfect Subjunctive Magari fosse vero. - If only it were true.Magari potessi venire da noi! - If only you could come over to our place! TIP: The word â€Å"magari† can also be used to mean â€Å"maybe† or â€Å"yes† depending on context. You’ll notice that the translations between Italian and English aren’t direct, and that’s because this tense is interpreted differently in Italian than in English. For instance, in the last example, if you wanted to say â€Å"He helped her so she could learn Italian†, you might want to translate â€Å"could† as â€Å"potrebbe†, using the conditional tense. I know it’s confusing at first, but the more you’re exposed to the language and the more you practice, the more intuitive it will become. Plus, as you learn, you can rely on keywords or phrases to help you decide whether or not to use the imperfect subjunctive tense. Key Phrases Pensare che - To think thatCredere che - To believe thatDubitare che - To doubt thatEssere importante che - To be important thatBastare che - To be enough thatDirsi che - To be said thatSperare che - To hope thatTemere che - To fear thatAffinchà © - So thatPrima che - BeforeNel caso che - In case that For conjugations of three regular verbs, see the table below. Conjugating Verbs in the Imperfect Subjunctive PRONOUN CANTARE SAPERE FINIRE che io cantassi sapessi finissi che tu cantassi sapessi finissi che lui/lei/Lei cantasse sapesse finisse che noi cantassimo sapessimo finissimo che voi cantaste sapeste finiste che loro/Loro cantassero sapessero finissero What About Irregular Verbs? Here are some examples of irregular verbs in the imperfect subjunctive. Essere - To be Fossi Fossimo Fossi Foste Fosse Fossero Se io fossi una sirenetta, sarei una brava nuotatrice. - If I were a mermaid, I would be a great swimmer.Non ti piaccio?! Pensavo fossimo fidanzati! - You don’t like me?! I thought we were dating! Stare - To be, to stay Stessi Stessimo Stessi Steste Stesse Stessero Mi fa sentire come se stesse cercando di nascondere qualcosa. - It makes me feel like he was trying to hide something.Pensavo stessimo andando dal panettiere. - I thought we were going to the bakery. Dire - To say Dicessi Dicessimo Dicessi Diceste Dicesse Dicessero Voleva che tu gli dicessi la verit! - She wanted you to tell her the truth!Vorrei che Marta non dicesse nulla di questo a Mario. - I would not like for Marta to say anything about this to Mario.E se ti dicessi che nulla di cià ² che vedi à ¨ reale? - And what if I were to tell you that nothing you see is real?

Vodafone Finance Report Case Study Example | Topics and Well Written Essays - 2500 words

Vodafone Finance Report - Case Study Example According to Reuters (2005) analysts' opinion, the company is outperforming currently (financial ratios provided can be seen in Appendix 1). The group turnover was 34,133 m on the year ended March 31, 2005, which was 33,559 in 2004 and 30,375 in 2003 (Vodafone Annual Report, 2005, p. 78). Presented in percentage, the growth of turnover in 2003/04 was 10.4% and in 2004/05 it was 1.7%. The rise of the group turnover represents the addition of new customers and the increase of revenue from value added services. Looking at the five-year annual growth of turnover given on the diagram 1 it can be easily seen that the company's rate of expansion is decreasing. During previous years the company was rapidly expanding due attraction of new customers; now the customer audience of Vodafone is stable. The interim results of six months ended September 30, 2005 show that the group turnover has increased 9% to 18,250 m (Reuters, 2005). Reasonably the cost of sales in 2005 has increased along with the group turnover, leading to the gross profit of 13,380 m. In 2004 gross profit was 14,098 m and in 2003 it was 12,479 m (Vodafone Annual Report, 2005, p. 88). This gives us the ability to evaluate gross profit margin providing us with the information on how much of the group turnover can cover the non-operational costs by dividing gross profit on group turnover. The following diagram shows the three-year perspective. As can be seen there is hardly a trend can be outlined, but it can be concluded that the gross profit margin has fallen to 39.19%, indicating the rise of operating costs. Diagram 2: Gross profit margin (%) The group's operating loss was 5,304 m, 4,842 m, 5,052 m in 2005, 2004, and 2003 respectively (Vodafone Annual Report, 2005, p. 78). Thus we can calculate the net profit margin, showing us basically the percentage of profit earned on sales, or in this case the percentage of losses lost on sales. Basically, net profit margin shows the profitability of the company. It is found by dividing operating profit (loss) on group turnover. The next diagram shows the net profit margin of three years. As can be seen the previous year 2004 was more profitable for Vodafone than 2005. Additionally Reuters (2005) report of net income 23% decrease to 2,780 m in the first half of 2006. The reasons of the decreasing profitability are increased operating costs, administrative expenses and a decrease of non-operating income. Diagram 3: Net profit margin (%) Liquidity Liquidity is important for the company as it reflects the ability of meeting its liabilities. High liquidity can detract from profits, because liquid assets are low returning investments. Low liquidity stunts company's growth and eventually leads to bankruptcy. Liquidity ratio is measured with dividing the current assets of the company by the its current liabilities. Current assets of Vodafone were 11,794 m and 13,149 m in 2005 and 2004 respectively (Vodafone Annual Report, 2005, p. 79). Current liabilities to creditors were 14,837 m in 2005 and 15,026 m in 2004 (Vodafone Annual Report, 2005, p. 79). The comparison of liquidity ratios for 2004-2005 can be found in the following table. Along with current ratio there is a quick ratio, which shows the ability of a company to repay its liabilities with cash only excluding inventory assets (sales of inventory are often