International Journal of Accounting & Finance Review

INFLUENCE OF MACROECONOMIC VARIABLES ON EXCHANGE RATE: A STUDY ON BANGLADESH

2023-02-01T17:45:55+00:00

Exchange rate plays an imperative role in international trade of the country. The exchange rate is an important macroeconomic variable used as parameter for determining international competitiveness and indicates the global position of economy of the country. The development of the country is closely related with its foreign exchange system. The construction of this study is to determine the influential macroeconomic variables of the exchange rate by considering 20 years, from 2002 to 2021, data of Bangladesh. Pearson’s correlation and multiple linear regression are used to analyse the data. The results indicate that current account balance, foreign exchange reserve, remittances, and GDP growth rate has a significant positive correlation with the exchange rate. However, interest rate and current account balance have no statistically significant relationship with the exchange rate. Therefore, current account balance, foreign exchange reserve, remittances, and GDP growth rate are the most influential factors in determining the exchange rate. Therefore, this research concludes that policymakers can change these influential factors to get the best exchange rate for the benefit of the growing economy of Bangladesh.

JEL Classification Codes: B22, O24.

WHAT CAUSES NON-PERFORMING LOANS? EVIDENCE FROM THE ISLAMIC BANKING SECTOR OF BANGLADESH

2023-02-03T16:44:01+00:00

This study aims to investigate the impact of bank-specific and macroeconomic factors on non-performing loans (NPLs), also known as irregular loans, in Islamic banks in Bangladesh. The study is crucial, as the NPL has become a growing concern for Bangladesh's banking sector, which is affecting the country's economy. The data of banks specific factors were collected from the annual reports of the sample. In contrast, macroeconomic factors were gathered from the World Development Indicators covering the period from 2007 to 2018. Different diagnostic tests, including correlations, heteroskedasticity, and VIF (Variance Inflation Factor), were run to confirm that the results from OLS are accurate and reliable. The study further runs fixed effect and random effect models to check the robustness of the findings. The findings indicate that bank-specific factors such as loan growth, loan-to-asset ratio, and net interest margin significantly reduce NPLs. Moreover, macroeconomic factors like GDP growth and inflation significantly influence NPLs under all models. While we divide the samples into some sub-samples, we found almost similar results, confirming the robustness of the findings. The findings suggest banks' management, regulatory bodies, and other stakeholders have necessary initiatives on how to reduce the NPLs.

JEL Classification Codes: F65, G21, G32, H81.

MEASURING AWARENESS ABOUT MUTUAL FUNDS: A STUDY ON BANK EMPLOYEES IN TRIPURA

2023-02-08T13:13:13+00:00

This paper aims to find out bank employees' awareness level towards mutual funds and their impact on investment in the mutual fund. The study was conducted using a simple random sampling design of 262 employees working in different banks in Tripura, India. The size of the population was 815 employees. The data was collected using a structured questionnaire. Ordinal logistic regression analysis and chi-square test were used to assess the impact of employees' awareness on investment in mutual funds. It was found that the overall level of awareness of bank employees in Tripura towards mutual funds was high, and the level of awareness and volume of investment in the mutual fund are directly related. We conducted a preliminary evaluation study on the awareness level of mutual funds of bank employees using ten multiple questions having one option correct. This study will provide a complete informative summary to the policymaker, bank employees, and non-bank employees to make decisions for investment. It will help to take all necessary steps to spread updated awareness about mutual funds among investors. The study consists of several vital inputs which will be useful to the academician to go for further study in detail. Further research may be done in this field by taking another variable factor that needs to be considered to measure the employees' awareness level.

JEL Classification Codes: G11, G14, G24, G38, N25.

INVESTMENT BEHAVIOR OF CORPORATE PROFESSIONALS TOWARDS MUTUAL FUNDS IN INDIA

2023-02-25T17:46:17+00:00

Investors today have access to a wide variety of investment opportunities thanks to the increasingly competitive nature of the market. Mutual funds, out of the many other investment options available, are the one that are best suited for the average person since they provide the ability to invest in a portfolio that is both diversified and managed by professionals at a fee that is relatively modest. A mutual fund is a type of investment instrument that allows investors to pool their capital for the purpose of purchasing a diverse portfolio of securities. The present research study aims to understand the investment behavior of corporate professionals and also to study the various factors which influence the investment behavior of corporate professionals towards mutual funds. The research study is based on the primary data gathered from 175 different respondents through the use of a structured questionnaire. Convenience sampling, a non-probability sampling was used to identify respondents for the research study. Exploratory Factor Analysis, often known as EFA, was used to identify various factors that influence the investment behavior of corporate professionals with regard to mutual fund investments. The present research study stood effective in elucidating seven significant factors that influence the investment behavior of corporate professionals with regard to mutual fund investments.

JEL Classification Codes: E30, E44, E62, D14.

BEHAVIORAL FACTORS INFLUENCING INVESTMENT DECISIONS: A SYSTEMATIC REVIEW USING PRISMA

2023-03-18T06:16:06+00:00

The purpose of this systematic review is to analyze the previous study made in the past related to an association between behavioral biases and investment decisions. This systematic review article identified 21 distinct biases affecting the investment decisions made by investors. Data were collected from 3 databases (Scopus, Taylor and Francis, and Web of Science) using PRISMA guidelines. The inclusion criteria for this systematic review were (i) publication date 2012 to 2022 (ii) published in the English language (iii) open access articles (iv) all types of documents except review articles etc. The findings of the study support that there is a significant relationship between 21 distinct behavioral biases and investment decisions. The study found there is a lack of female participants to male participants. There is a sampling bias found in many studies i.e., the studies employed non-probability techniques to collect samples. This study extends the current knowledge about the previous study being researched related to an association between behavioral biases and investment decisions. This systematic review provides a clear picture of the gaps in the previous literature. This study is helpful for researchers and academicians in understanding the biases investors undergo while making investment decisions and addressing the gaps identified related to different types of behavioral biases and areas of study that need to be explored more in near future.

JEL Classification Codes: D91, G10, G4, G11, G41.

IMPACT OF FINANCIAL LITERACY ON INVESTORS: A SYSTEMATIC LITERATURE REVIEW USING PRISMA PROTOCOL

2023-03-18T06:16:29+00:00

Financial literacy is the potential to understand and productively use different financial skills such as managing finance, budgeting and investing. FL has been considered one of the most important factors to improve the growth of investors and the economy as a whole. This study’s main purpose is to present a Systematic Literature Review (SLR) on FL and Investment between 2012 and 2021. The Systematic Literature Review analysis has been performed based on the PRISMA to analyse 26 related articles obtained from the Web of Science, Taylor and Francis and Jstor database. The review of the paper has been categorised based on publication year, a journal list, publication by authors number, features of review articles, tools and techniques applied, variables, findings and practical implications and outcomes of the area of study. The outcomes of this paper provide an understanding of the publication criteria of financial literacy and investment along with that it also offers possible approaches for further publications. The findings of the study also analyse the impact of financial literacy on investors. The study will provide an in-depth understanding of the concepts of Financial Literacy. The study suggests that future researchers initiate further research on financial literacy and investment and also diversify the broader study period. This paper is the first of its kind to identify the impact of investment preference on investors.

JEL Classification Codes: G50, G51, G52, G53.