Predicting Network linkages of banking system distress based on operational risks and behavioral finance components

Subject Areas : Journal of Investment Knowledge

ahmad bidi ¹ , Fraydoon Rahnamay Roodposhti ² , Gholam Reza Gholami Jamkarani ³ , HAMIDREZA KORDLOUIE ⁴ , Mortaza Baky Hasuee ⁵

1 - PhD. Student in Financial Management, Qom Branch, Islamic Azad University, Tehran, Iran
2 - Professor of Accounting Department, Science and Research Branch, Islamic Azad University, Tehran, Iran
3 - Accounting and finance Department, Qom Branch, Islamic Azad University, Qom, Iran
4 - Associate Professor of Accounting and management Department, Ealamshar Branch, Islamic Azad University, Ealamshar, Iran
5 - Assistant Professor, Economic and Head of Office Economic Modeling, Imam Sadegh University, Tehran, Iran

Received: 2020-09-04 Accepted : 2020-11-01 Published : 2024-12-21

Keywords: Operational risks, Network linkages, Behavioral Finance Approach, Banking system, Distress Prediction,

Abstract :

The present research is aimed at prediction of network linkages of banking system distress based on operational risks and behavioral finance approach. Methodology of the present research is of survey descriptive, practical from the purpose standpoint. Notably, in order to reach this purpose, firstly, based on study and review of theoretical basics, research variables were introduced. Then, by making use of Krejcie and Morgan Table, 384 participants were selected, and upon distribution of questionnaire among the aforesaid, research data were collected. Furthermore, in order for analysis of data and estimation of research empirical models, the researcher used structural equation modeling (SEM) and Smart PLS software. Of note, findings of this research indicate that behavioral financial standpoints and operational risk have significant effects on prediction of banking network disorder. Furthermore, based on estimated beta coefficients, among behavioral financial elements, economic behavior, cognitive standpoint, judgment biases, heuristic behaviors, decision making biases and value and return of stocks have respectively the highest effect on banking disorder, and among operational risk elements, human resources risk, systemic risk, transaction risk, technology risk and fraudulent and deception risk have respectively the highest effect on banking disorder.

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