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J. Practical Audit. , 2(1): 07-12, 2021Research PaperAnalysis of Factors Affecting the Absorption of BankResources in Eghtesad-e-Novin Bank of Yazd ProvinceHamideh Shekari ٭ a , Najmeh Jalalian b , Nahid Amrollahi cabAssistant professor, Department of Public Administration, Payame Noor University, Tehran, I. R. of IranAssistant professor, Department of Public Administration, Payame Noor University, Tehran, I. R. of Iranc Assistant professor, Department of Management, Ardakan University, Yazd, I. R. of IranReceived: 18 December 2021Revised: 24 January 2021Accepted: 15 February 2021AbstractDue to the importance of the banking system and effective macroeconomic situation in each country, banks haveundeniable role in the economy of any country. Therefore, careful planning and management system for thebanking sector in terms of liquidity and volume of bank deposits and check sources and their impact on the marketshare of banks is important. The main source of financing is the savings of the people in each community. Banksmust choose appropriate strategies for absorbing financial resources. So identifying the factors affectingabsorption of bank resources in each bank is necessary. The main goal of this study is determining factors affectingthe absorption of bank resources in Eghtesad-e-Novin Bank of Yazd Province. We investigated the effect of sevenfactors including human capital, marketing, Services, IT, Interest Rate, Customer Satisfaction and Utility onresource absorption in Eghtesad-e-Novin Bank. The data used in this study consist of questionnaire responses. Atotal of 200 questionnaires were sent out and 103 valid responses were received. In this study regressiontechnique was employed to determine the effect of seven mentioned factors on resource absorption. The resultsindicated that of these seven mentioned factors, five factors including Services, IT, Interest Rate, CustomerSatisfaction and Utility had positive impact on Resource Absorption.Keywords: Absorption of Resources, Services, IT, Interest Rate, Customer Satisfaction, Eghtesad-e-Novin Bank.How to cite the article:H. Shekari, N. Jalalian, N. Amrollahi, Analysis of Factors Affecting the Absorption of Bank Resources in Eghtesad-eNovin Bank of Yazd Province, J. Practical Audit., 2021; 2(1): 07-12,1. IntroductionBanks are the most important servicing institutesin each country. The activities of the banks canaffect directly on all parts of the country such asmanufacturing and servicing sectors. Banks try toabsorb more deposits by emphasizing and payingattention to the requirements of their customersand using new and modern techniques [1].Nowadays, the Characteristics of the environmentin which, the credit institutes and the banksoperate, have a lot of difference with thetraditional one. The banks and credit instituteshave changed a lot. They should have Highflexibility and equipped with update informationto response to the customer expectations.Management and the processes related to it havean important role in the activity and duration ofthe banks in these competitive and peremptoryenvironments. Due to the changing paradigmswhich are govern on economic environment,traditional management methods especially inbanking field and absorbing sources can’t providethe requirements of a new condition so using newmodels and techniques are essential to deal withthese challenges. But nowadays for dealing withnew competitive environments, banks change theirmanagement methods. They change it in a way thatthey are based on the paradigm of the valuecreation. Many of the methods and new banktechniques such as absorbing the deposits havebeen developed based on the paradigm of thevalue creation, so they can choose appropriatestrategies in new competitive conditions forcompetition and duration [2]. In present study, weaim to determine the effective factors of absorbingbank deposits in branches of Eghtesad-e- Novinbank Of Yazd province.J. Practical Audit. Acc., 2021; 2(1): 07-12 7
2. Literature ReviewThe purposes of banks are improvement inprofitability and an emphasis on attracting newcustomers and maintain current customers [3]. Ina general classifying, effective factors on absorbingand allotment of bank resources can be classifiedinto two groups: the factors which are inside theorganization and the factors which are outside theorganization: Factors which are outside theorganization are the one which are notcontrollable. It means that the manager of the bankcan’t control some factors such as: Inflation rate,growth rate, money supply, national income,economic growth, growth rate of Gross nationalproduct And the politics of Central Bank. Factorswhich are inside the organization can be munication and human factors, physicalfactors and Institutional affiliation factors [2]. Inthis paper, we focus on internal factors. Some ofthe internal Factors affecting mobilization ofresources and obtaining bank deposits are asfollow:Human Capital: Schultz (1993) argues that humancapital is a key element in absorbing bank deposits.Human capital includes individual capabilities,knowledge, skills and experience of employees andmanagers that are associated with the tasks facingthem and to increase the storage capacity ofknowledge, skills and experience throughindividual learning refers. With this definition it isclear that human capital involves wider range ofhuman resources. Human capitals go throughknowledge and skill to identify opportunities thatwill affect them. In fact, human capital is a fusion ofgenetic characteristics, has been establishedcapabilities, skills and experience acquired by aperson during life. However, the eristics in different populations and ethniclines is not observed, differences in human capital,due to differences in the abilities acquired. In otherwords, human capital, capabilities, knowledge andskills go mainly through education of theeducation. Thus, human capital is indeed nothingbut the ability to manage people's lives andbecause this issue is raised in an economic context,the ability to focus on producing goods andservices that are used in life, it would facilitatematters and its activities will flourish and grow [3].Information technology: In the banking sectorinnovations such as electronic money transferterminals, Automatic Payment, Virtual Banking,Internet Banking moment, a great development inthis sector have created and improve performance,efficiency, speed, communication, and reduceoperating costs for banks, so banks to gaincompetitive advantage in the field of financial8 markets to raise new funds should make use ofelectronic banking and related technologies [1].Interest rate paid to depositors: The depositorybank is important from two perspectives: 1 - It'smoney that people nonsmokers powers granted tothe banks so the banks can increase the creditfacility to collect more resources in production andinvestment are granted. 2 - Second in importanceis that when people prefer to keep their moneywith the bank and may decide to spend lessreduced the volume of money in circulation, whichreduces the rate of inflation and the resultingincrease in purchasing power.Marketing: Marketing is another element inabsorbing bank deposits. Marketing is part of theInstitute's activities include operations such asplanning, promotion, pricing and presenting goodsor services the customer is desirable. So thatproducts should be designed according tocustomer requirements, price is realistic, and canbe easily distributed through the channels. In anyorganization, large or small, profit or non-profit,domestic or international, without having a propermarketing system will not succeed [3].Utility and indoor seating banks: A goodenvironment can affect the value of theiremployees and increase productivity is affectedwith the diversification of banking services,organization working to create a relaxed andproductive environment in organizations, leadingto activation of additional manpower, theirfreshness, reducing antidepressants, positive andultimately achieve productivity growth in servicesis considered necessary. Place of banks andfinancial institutions are an important incentive inattracting customers. So banks to establishbranches require careful scientific evaluation andfeasibility of a bank's branches are located indistance of time and place, establishment of bankbranches in key areas such as industrial estates,residential and commercial buildings and theestablishment of branches in nearby public carparks are among the parameters that influenceDepository bank customers. It concerns the newbanking executives and senior managers of thebank. Banks and financial resources attract morecustomers to the appropriate workplaceenvironment that includes indicators of physical,psychological and social, as well [1].Service factors: Service factors include fourcategory containing [4]:А) Variety of bank services: improvement inservices and verifying them in the banking systemcan lead to both profitability and absorption ofresources. Thus, banking services should beimproved and it is a way that all successful banksaround the world have tested and came to someconclusions. В) The quality of bank services:regarding the intangible characteristics of services,J. Practical Audit. Acc., 2021; 2(1): 07-12
one of the ways through which banks candifferentiate itself from competitors is to providesuperior services quality compared to them.Providing high quality services leads to acompetitive advantage for banks and finally bringsabout higher profit. In order to achieve this goal,customers' expectations of services' quality shouldbe met or surpassedCustomer Satisfaction: Employees are the mostimportant asset of any organization. The staffs arethe bridge between the organization and thecustomer. Banks and financial institutions are alsorequired funds with the tools that most employeesare getting from customers. There is a bank'ssurvival depends on the customer's bank. Ifcustomers do not exist, no bank will be. But what isimportant is the impact of these characteristics onbank customers increasingly effective in attractingcustomers to the Bank. Individual characteristicssuch as appearance, good fit and tidy; According y, respect and humility are to beconsidered employees [4].Mahmoudi Meymand and Rafie Rezvani (2014)investigated the impact of e-banking on absorptionof banking resources in Bandarabas Housing Bankbranches. The findings showed that e-banking hasaffected absorption of banking resources inBandarabas Housing Bank branches. Moreover, theuse of ATMs, POS, mobile banking and internetservices has affected absorption of bankingresources in Bandarabas Housing Bank branches.The priority of the absorption rate of e-bankingresources in the four dimensions of e-banking isuse of ATMs, POS, internet services and mobilebanking respectively [5].Mao-qin and Ling (2011) showed thatimplementingelectronicmanagementofrelationship with customer in bank leads to animproved customer satisfaction and, in turn,additional customer benefits and ultimately moreprofits for the banks will be created [6].Abhiman et al., (2009) have enumerated factorssuch as manpower, employee's education, bankenvironment, banks, bank premises and ucing government interference in bank affairsas effective factors affecting the attraction of publicdeposits. According to them, the most influentialfactor in absorbing public investment is manpower[7].Asadi (2007) in his thesis entitled "banks keysuccess factors in attracting non-commitmentresources (Interest Free saving account andcurrent) with emphasis on Maskan Bank hasconcluded that use of computer technology, theemployees' skills, service diversity, customersatisfaction, indoor utility, the desirability of thelocation and advertisement on attracting noncommitment resources affects banks [8].Liu and Hung (2006) studied the long-termprofitability of banks in Taiwan. They finallyconclude that banking services is the mostimportant factor in profitability and profit. Also thestaffs are the most important factor to achieve tothe increased profitability and profit [9].2.1 MethodologyThe aim of this study is to determine the effectivefactors of absorbing bank deposits in branches ofEghtesad-e- Novin bank Of Yazd province. Thetarget population of this study was the customersof Eghtesad-e-Novin bank Of Yazd province. Todetermine the factors, we performed aquestionnaire survey. Of the 200 questionnairesthat were distributed, 103 usable questionnaireswere returned, a response rate of 51%. Reliabilityof constructs and variables was evaluated byCronbach’s α. Table 1 lists the Cronbach’s α of theconstructs. As can be seen, all constructs haveCronbach’s above 0.7, which indicates highreliability [10].Table 1: Results of Reliability testJ. Practical Audit. Acc., 2021; 2(1): 07-12 9
2.2 Research HypothesisThe main hypothesises of paper is coming asbelow:1. The human capital has significant influence onAbsorption of resources in Eghtesad-e-Novinbank.2. Marketing has significant influence onAbsorption of resources in Eghtesad-e-Novinbank.3. The Services have significant influence onAbsorption of resources in Karafarin bank.4. Information technology has significant influenceon Absorption of resources in Eghtesad-eNovin bank.5. Interest rate paid to depositors has significantinfluence on Absorption of resources inEghtesad-e-Novin bank.6. Customer satisfaction has significant influenceon Absorption of resources in Eghtesad-eNovin bank.7. Utility and indoor seating banks have significantinfluence on Absorption of resources inEghtesad-e-Novin bank.2.3 Data AnalysisSince the variables’ distributions were not normal,we use Spearman's test for calculatingCorrelations. Table 2 contains the intercorrelations of all the measures. It is seen that allthe constructs of Absorption of resources ispositively correlated with Absorption of resources.Table 2: correlations of constructs and variablesCorrelations can only reveal the degree ofrelationship between constructs. To furtherunderstand the direct effects, regression test wasperformed using SPSS.Tables 3 and 4 show the results of linearregression. Table 3 is the ANOVA table. This tableindicates that the regression model predicts theoutcome variable significantly well. Because the10 Sig. of the test is less than 0.05, and indicates that,overall, the model applied can statisticallysignificantly predict the outcome variable.J. Practical Audit. Acc., 2021; 2(1): 07-12
Table 3: The results of linear regression: ANOVAba. Predictors: (Constant), Utility, InterestRate, IT, CustomerSatisfaction, Servicesb. Dependent Variable: ResourceAbsorptionTable 4, provides us with information on eachpredictor variable. This gives us the informationwe need to predict Resource Absorption fromfactors of Resource Absorption . We can see thatboth the constant and Predictors contributesignificantly to the model (by looking at the Sig.column).Table 4: The results of linear regression: Coefficientsaa. Dependent Variable: ResourceAbsorptionBy looking at the B column under theUnstandardized Coefficients column, we canpresent the regression equation as:Resource Absorption 3. 380 0. 294 (Services) 0. 145 (IT) 0. 059 (Interest Rate) 0. 209(Customer Satisfaction) 0. 010 (Utility)The results indicate that of the seven mentionedfactors, five factors including Services, IT, InterestRate, Customer Satisfaction and Utility havepositive impact on Resource Absorption. In otherwords, higher Services, IT, Interest Rate, CustomerSatisfaction and Utility will lead to higher ResourceAbsorption. Hence H3 to H7 are supported. H1 andH2 are rejected.3. ConclusionDue to the importance of the banking system andeffective macroeconomic situation in each country,banks have undeniable role in the economy of anycountry. therefore, careful planning andmanagement system for the banking sector interms of liquidity and volume of bank deposits andcheck sources and their impact on the marketshare of banks is important.The main source of financing is the savings of thepeople in each community. The banking system isthe main task of mobilizing resources. Banks holdexcess funds collected and paid to the applicant'sfacility, its traditional task of mediation betweendepositors and borrowers play facilities. Theactivities of a bank's financial resources are veryimportant; because success in this area can be afactor for success in other areas.There are significant differences between differentbanks in the deposit interest and facilitiesregarding customers’ point of view. In this study,we investigated the effect of seven factor includinghuman capital, marketing, Services, IT, InterestRate, Customer Satisfaction and Utility on resourceabsorption in Eghtesad-e-Novin Bank of YazdProvince. The results indicated that of these sevenmentioned factors, five factors including Services,IT, Interest Rate, Customer Satisfaction and Utilityhad positive impact on Resource Absorption. Toimprove the resource absorption we propose:Increasing the number of ATMs Expansion of electronic banking Increasing the number of machines sale (POS) todevelop e-banking J. Practical Audit. Acc., 2021; 2(1): 07-12 11
Benefiting from the experience of successfulcountries in the implementation of electronicbanking and its localization in line with thecountry's culture Improving relationships with employees andcustomers Paying attention to customer complaints Providing excellent services such as instant issueATM card References[1] Ostadi, Hossein and Sarlak, Ali, 2014, Effective factors on theabsorption of bank deposits in order to increase the relativeshare of Isfahan Sepah Bank, International Journal ofAcademic Research in Economics and ManagementSciences, Vol. 3, No. 4, pp 139-149.[2] Mohammadian Saravi, Mohsen and Bozorg, Reza, 2014,Identifying Effective Factors in Absorbing Bank Deposits(Case Study: Branches of Tejarat Bank- North East OfTehran), Switzerland Research Park Journal, Vol. 104, No. 1,pp 219-227.[3] Doostar, Mohammad, Ramezanian, Mohammad Rahim andPoormohseni Shakib, Seyede Marzieh, 2014, Identifying andPrioritizing the Factors Influencing in Absorption of BankResources (Case Study: Kar Afarin Bank), Journal of AppliedEnvironmental and Biological Sciences 4(5), pp 15-19.[4] Gashtasebi, Gholam Reza, Momeni, Ali and Lak, Fazlolah,2013, Analysis and Comparison of Factors Affecting theAbsorption of Bank Resources in Mellat and Parsain Banksof Bushehr Province, European Online Journal of Naturaland Social Sciences, vol.2, No. 3(s), pp 2335-2344.[5] Mahmoudi Meymand, Mohammad and Rafie Rezvani,Fahime, 2014, A Study of the Effect of E-Banking onAbsorption of Banking Resources in Bandarabas HousingBank Branches, Spectrum: A Journal of MultidisciplinaryResearch, Vol. 3, Issue 9, pp 112-122.[6] Mao-qin, GAN and Ling, GAO, 2011, The Critical SuccessFactors for the Banks Implementing e-CRM, Available at:http: IEEE EXPLORER, PP 4.[7] Abhiman, D., Subhash, C.R. and Ashok, N., 2009, Labor-useefficiency in Indian banking: Abranch -level analysis,Omega, Vol.37, Issue 2, pp 411-425.[8] Asadi, D., 2007, An investigation of banks key success factorsin attracting non-commitment resources, Marketing 17(2),pp 81-91.[9] Liu, Yong-Chin and Hung, Jung-Hua, 2006, Services and thelong-term profitability in Taiwan's banks, Global FinanceJournal, Vol .17, Issue 2, pp 177-191.[10] Nunnally, J.C., 1978, Psychometric Theory, second ed.,McGraw-Hill, New York.12 J. Practical Audit. Acc., 2021; 2(1): 07-12
the absorption of bank resources in Eghtesad-e-Novin Bank of Yazd Province. We investigated the effect of seven factors including human capital, marketing, Services, IT, Interest Rate, Customer Satisfaction and Utility on resource absorption in Eghtesad-e-Novin Bank. The data used in this study consist of questionnaire responses. A
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