Machine Learning for Predicting Deposits Bank Market Shares in Emerging Markets: Evidence from Egypt

Autores

  • Osama Wagdi Business Administration Department, Faculty of Management, Economics and Business Technology, Egyptian Russian University, Egypt. ORCID 0000-0003-0451-9726; ResearcherID: D-4898-2019; Scopus Author ID: 57212470180
  • Ream N. Kinawy Business Administration department, College of Business Administration, Gulf University for Science and Technology, Mishref, Kuwait.
  • Ghada Nabil Business Technology Department, Faculty of Management, Economics and Business Technology, Egyptian Russian University, Egypt.

DOI:

https://doi.org/10.20397/2177-6652/2023.v23i4.2729

Palavras-chave:

Banking, Egypt, Artificial Neural Network ANN

Resumo

The study investigated machine learning for predicting deposit bank market shares in Egypt as emerging markets. The examination encompasses the years 2014 to 2022, based on the Egyptian banks listing on the Egyptian exchange. The study sampled 11 banks based on artificial neural networks ANN under the economic growth rate, interest spreads, required reserve ratio, capital adequacy requirements, style of bank, number of branches, number of ATMs, number of cards, and number of e-banking services. The study found that artificial neural networks can explain changes in the market shares of Egyptian banks by 99.4% and 96.71%, according to regression analysis and cross-sectional analysis, respectively. But the predicted value was less than the actual values according to the Wilcoxon Signed Ranks Test, which can be explained by the study’s reliance on a sample representing one-third of the study population, which are the banks listed on the Egyptian Exchange only. These banks are under the supervision of shareholders to a greater extent than the rest of the unlisted banks.

Referências

Ahamed, M. M., Ho, S. J., Mallick, S. K., & Matousek, R. (2021). Inclusive banking, financial regulation and bank performance: Cross-country evidence. Journal of Banking & Finance, 124, 106055. https://doi.org/10.1016/j.jbankfin.2021.106055

Akin, G. G., Aysan, A. F., Borici, D., & Yildiran, L. (2013). Regulate one service, tame the entire market: Credit cards in Turkey. Journal of Banking & Finance, 37(4), 1195-1204. https://doi.org/10.1016/j.jbankfin.2012.11.016

Alzubi, J., Nayyar, A., and Kumar, A., (2018), "Machine Learning from Theory to Algorithms: An Overview", Second National Conference on Computational Intelligence. https://doi.org/10.1088/1742-6596/1142/1/012012

Angelini, P., & Cetorelli, N. (2003). The Effects of Regulatory Reform on Competition in the Banking Industry. Journal of Money, Credit and Banking, 35(5), 663–684. https://scholar.google.com/scholar?hl=ar&as_sdt=0%2C5&q=The+effects+of+regulatory+reform+on+competition+in+the+banking+industry.+journal+of+Money%2C+credit+and+banking&btnG=

Bahrami, H. R., Haery, F. A., & Karamad, F. (2014). Investigated the effective factors in the process of market share increase among the branches of Bank Saderat. International Journal of Academic Research in Economics and Management Sciences, 3(1), 51. http://dx.doi.org/10.6007/IJAREMS/v3-i1/577

Berger, A. N., Leusner, J. H., & Mingo, J. J. (1997). The efficiency of bank branches. Journal of Monetary Economics, 40(1), 141-162. https://doi.org/10.1016/S0304-3932(97)00035-4

Cetorelli, N., & Gambera, M. (2001). Banking market structure, financial dependence and growth: International evidence from industry data. The Journal of Finance, 56(2), 617-648.‏ https://doi.org/10.1111/0022-1082.00339

Collender, R. N., & Shaffer, S. (2003). Local bank office ownership, deposit control, market structure, and economic growth. Journal of Banking & Finance, 27(1), 27-57. https://doi.org/10.1016/S0378-4266(01)00207-2

de Guevara, J. F., & Maudos, J. (2011). Banking competition and economic growth: cross-country evidence. The European Journal of Finance, 17(8), 739-764. https://doi.org/10.1080/1351847X.2011.554300

Dick, A. A. (2006). Nationwide branching and its impact on market structure, quality, and bank performance. The Journal of Business, 79(2), 567-592. https://doi.org/10.1086/499131

Gonzalez, F. (2009). Determinants of bank‐market structure: Efficiency and political economy variables. Journal of Money, Credit and Banking, 41(4), 735-754. https://doi.org/10.1111/j.1538-4616.2009.00229.x

Gopalan, Y. (2022). The effects of ratings disclosure by bank regulators. Journal of Accounting and Economics, 73(1), 101438.‏ https://doi.org/10.1016/j.jacceco.2021.101438

Hannan, T. H. (2007). ATM surcharge bans and bank market structure: The case of Iowa and its neighbors. Journal of Banking & Finance, 31(4), 1061-1082. https://doi.org/10.1016/j.jbankfin.2006.10.002

Helmy, A., & Wagdi, O. (2019). Three-dimensional analysis of bank profit with the development of regulatory restrictions: evidence from Egypt. International Journal of Economics and Finance, 11(3), 12-31. https://doi.org/10.5539/ijef.v11n3p12

Ho, S. H., & Saadaoui, J. (2022). Bank credit and economic growth: A dynamic threshold panel model for ASEAN countries. International Economics, 170, 115-128. https://doi.org/10.1016/j.inteco.2022.03.001

Khan, A., Hassan, M. K., Paltrinieri, A., & Bahoo, S. (2021). Trade, financial openness and dual banking economies: Evidence from GCC Region. Journal of Multinational Financial Management, 62, 100693.‏ https://doi.org/10.1016/j.mulfin.2021.100693

KishanBissa, C. and Vyas, R. (2017), "Estimation of Appropriate Forecasts using Neural Network Learning of Previous Sales Data", international journal for research in applied science & engineering Technology, 5(6): 2265-2270. https://scholar.google.com/scholar?hl=ar&as_sdt=0%2C5&q=Estimation+of+Appropriate+Forecasts+using+Neural+Network+Learning+of+Previous+Sales+Data&btnG=

Kumar, L., Malathy, D., & Ganesh, L. S. (2011). The diffusion of ATM technology in Indian banking. Journal of Economic Studies, 38(4), 483-500. https://doi.org/10.1108/01443581111160905

MacCarthy, J. (2016). The effect of cash reserve ratio (CRR) on the financial performance of commercial banks and their engagement in CSR in Ghana. Journal of Finance, 4(3), 1-12. https://scholar.google.com/scholar?hl=ar&as_sdt=0%2C5&q=The+effect+of+cash+reserve+ratio+%28CRR%29+on+the+financial+performance+of+commercial+banks+and+their+engagement+in+CSR+in+Ghana.+Journal+of+Finance&btnG=

Mahesh, B., (2020), "Machine Learning Algorithms - A Review", International Journal of Science and Research, 9 (1). http://dx.doi.org/10.21275/ART20203995

Massoud, N., Saunders, A., & Scholnick, B. (2006). The impact of ATM surcharges on large versus small banks: Is there a switching effect?. The Journal of Business, 79(4), 2099-2125. https://doi.org/10.1086/503658

Mujeri, M. K., & Younus, S. (2009). An analysis of interest rate spread in the banking sector in Bangladesh. The Bangladesh Development Studies, 32 (4), 1-33. https://scholar.google.com/scholar?hl=ar&as_sdt=0%2C5&q=An+analysis+of+interest+rate+spread+in+the+banking+sector+in+Bangladesh.+The+Bangladesh+Development+Studies&btnG=

Nazaritehrani, A., & Mashali, B. (2020). Development of E-banking channels and market share in developing countries. Financial Innovation, 6(1), 12. https://doi.org/10.1186/s40854-020-0171-z

Nidyanti, A., & Siswantoro, D. (2022). Shariah Compliance Level of Islamic Banks in Asia and Its Implications on Financial Performance and Market Share. European Journal of Islamic Finance, 9(1), 15-21. https://doi.org/10.13135/2421-2172/6025

Omrani, H., Alizadeh, A., Emrouznejad, A., & Oveysi, Z. (2023). A novel best‐worst‐method two‐stage data envelopment analysis model considering decision makers' preferences: An application in bank branches evaluation. International Journal of Finance & Economics, 28(4), 3593-3610. https://doi.org/10.1002/ijfe.2609

Ouedraogo, S., & Sawadogo, H. (2022). Financial development, financial structure and economic growth in the Sub‐Saharan African countries. International Journal of Finance & Economics, 27(3), 3139-3162. https://doi.org/10.1002/ijfe.2315

Parvin, B., G., and Parvin, L., G., (2023), "Applications of Artificial Intelligence in Fault Detection and Prediction in Technical Systems", 4th International Conference on Recent Developments in Management and Industrial Engineering, Helsinki-Finland. https://scholar.google.com/scholar?hl=ar&as_sdt=0%2C5&q=Applications+of+Artificial+Intelligence+in+Fault+Detection+and+Prediction+in+Technical+Systems%22%2C+4th+International+Conference+on+Recent+Developments+in+Management+and+Industrial+Engineering&btnG=

Perera, S., Skully, M., & Wickramanayake, J. (2010). Bank market concentration and interest spreads: South Asian evidence. International Journal of Emerging Markets, 5(1), 23-37. https://doi.org/10.1108/17468801011018257

Pineda-Jaramillo, J. D. (2019). A review of Machine Learning (ML) algorithms used for modeling travel mode choice. Dyna, 86(211), 32-41. https://scholar.google.com/scholar?hl=ar&as_sdt=0%2C5&q=A+review+of+Machine+Learning+%28ML%29+algorithms+used+for+modeling+travel+mode+choice.+Dyna&btnG=

Pudaruth, S., Jogeeah, M., and Chandoo, A., K., (2015), "Using Artificial Neural Networks to Predict Winners in Horseraces: A Case Study at the Champs de Mars", International Information Management Corporation, ISBN: 978-1-905824-50-2. https://scholar.google.com/scholar?hl=ar&as_sdt=0%2C5&q=Using+Artificial+Neural+Networks+to+Predict+Winners+in+Horseraces%3A+A+Case+Study+at+the+Champs+de+Mars%22%2C+International+Information+Management+Corporation&btnG=

Ray, S., (2019), "A Quick Review of Machine Learning Algorithms", International Conference on Machine Learning, Big Data, Cloud and Parallel Computing, India. https://doi.org/10.1109/COMITCon.2019.8862451

Revathi, P. (2019). Digital banking challenges and opportunities in India. EPRA International Journal of Economic and Business Review, 7(12), 20-23. https://scholar.google.com/scholar?hl=ar&as_sdt=0%2C5&q=Digital+banking+challenges+and+opportunities+in+India.+EPRA+International+Journal+of+Economic+and+Business+Review&btnG=

Rizwan, M. S., Moinuddin, M., L’Huillier, B., & Ashraf, D. (2018). Does a one-size-fits-all approach to financial regulations alleviate default risk? The case of dual banking systems. Journal of Regulatory Economics, 53(1), 37-74. https://doi.org/10.1007/s11149-017-9340-z

Sarker, I., H., 2021, "Machine Learning: Algorithms, Real-World Applications and Research Directions", SN COMPUT. SCI. 2, 160. https://doi.org/10.1007/s42979-021-00592-x

Shafei, R., & Sijanivandi, S. (2022). The intra-sectional marketing maturity and the E-banking market share; involvement of other units in marketing activities. Marketing Science and Technology Journal, 1(1), 13-28. https://scholar.google.com/scholar?hl=ar&as_sdt=0%2C5&q=The+intra-sectional+marketing+maturity+and+the+E-banking+market+share%3B+involvement+of+other+units+in+marketing+activities.+Marketing+Science+and+Technology+Journal&btnG=

Sharifani, K. and Amini, M, (2023), "Machine Learning and Deep Learning: A Review of Methods and Applications" World Information Technology and Engineering Journal, 10 (7), 3897-3904. https://scholar.google.com/scholar?hl=ar&as_sdt=0%2C5&q=Machine+Learning+and+Deep+Learning%3A+A+Review+of+Methods+and+Applications%22+World+Information+Technology+and+Engineering+Journal&btnG=#d=gs_cit&t=1700563279071&u=%2Fscholar%3Fq%3Dinfo%3AedeZiL4W-cMJ%3Ascholar.google.com%2F%26output%3Dcite%26scirp%3D0%26hl%3Dar

Spurlin, W. P. (2022). Market share, larger competition and the profitability of rural, small community banks. Managerial Finance, 48(11), 1579-1590. https://doi.org/10.1108/MF-07-2020-0387

Valahzaghard, M., & Bilandi, E. (2014). The impact of electronic banking on profitability and market share: Evidence from banking industry. Management Science Letters, 4(12), 2531-2536. http://dx.doi.org/10.5267/j.msl.2014.11.003

Xia, Y., & Liu, P. (2022). Does bank competition promote corporate green innovation? Evidence from the location of bank branches. China & World Economy, 30(2), 84-116. https://doi.org/10.1111/cwe.12411

Downloads

Publicado

2023-12-11

Como Citar

Wagdi, O., Kinawy, R. N., & Nabil, G. (2023). Machine Learning for Predicting Deposits Bank Market Shares in Emerging Markets: Evidence from Egypt. Revista Gestão & Tecnologia, 23(4), 473–492. https://doi.org/10.20397/2177-6652/2023.v23i4.2729

Edição

Seção

ARTIGO