Investment in information technology systems and other determinants of bank profitability in the UK

Holden, K.; El‐Bannany, Magdi

doi:10.1080/0960310042000211623

Cited by 59 publications

(37 citation statements)

References 9 publications

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“…Holden and El-Bannany [14] investigated whether IT investment affects bank profitability in the UK. The results showed that the number of ATM installed by a bank had a positive impact on bank profitability.…”

Section: Impact Of Atm Intensity On Banks' Cost Efficiencymentioning

confidence: 99%

Impact of ATM intensity on cost efficiency: An empirical evaluation in Taiwan

Hung

Yen

et al. 2009

Information & Management

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Section: Impact Of Atm Intensity On Banks' Cost Efficiencymentioning

confidence: 99%

Impact of ATM intensity on cost efficiency: An empirical evaluation in Taiwan

Hung

Yen

et al. 2009

Information & Management

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“…2 One important exception isHolden and El-Bannany (2004), who look at the impact of ATM adoption and sharing on bank profits in the UK. Although they find a positive relationship between the number of ATMs and bank profit, they fail to find such evidence for a bank's membership in a shared ATM network.…”

mentioning

confidence: 98%

The effects of shared ATM networks on the efficiency of Turkish banks

Damar

2006

Applied Economics

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This study investigates whether forming shared ATM networks has yielded positive benefits for banks in Turkey by increasing their productive efficiency. Using a Data Envelopment Analysis (DEA) approach, pure technical and scale efficiency scores of Turkish banks are estimated and analysed for the period 2000–2003. The results suggest that although it is possible to realize positive effects through ATM sharing arrangements, there are multiple factors that determine which banks realize such benefits. The geographical distribution of shared ATMs between urban and rural markets and the level of competition between banks within urban areas are shown to be important determinants of differences in bank efficiency. This discrepancy between the gains associated with ATM sharing may have important implications concerning the adoption and sharing of new technology by banks in developing countries.

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“…For example, Shawkey (1995), Daniel and Storey (1997), and Gupta (1998) show that investing in information technology results in cost savings and better services for customers, which should be reflected in increased bank profits. Holden and El-Bannany (2004) find that information technology system investment has a positive effect on bank profitability in retail banking. DeYoung (2005) argues that Internet-only banking success depends on attaining sufficient scale and strong management practices.…”

Section: Related Literaturementioning

confidence: 94%

“…However, these papers ignore the resource costs in technology choice, investment in human resource relative to information technology, incurred in intermediary operations. A growing body of research investigates the impact of human resource investment (e.g., Bartel, 2004;Lengnick-Hall, Lengnick-Hall, Andrade, & Drake, 2009), or information technology investment (e.g., Holden & El-Bannany, 2004;Keramati, Azadeh has on bank performance, the magnitude of these effects, and how they might differ with government capital injections under regulatory deposit insurance fund protection boils down to a question, one that we confront in this paper. 1 In retail banking, investment in human resource and information technology management are two key technology choice issues.…”

Section: Introductionmentioning

confidence: 99%