The Importance Of Budgeting In Banking

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The banking sector adopted budgeting strategies to ensure that is guarded against probable future risks that may be faced. The DIB bank adopts measures against probable risks through measures to avoid such adverse conditions like risk concentrations which results when a number of players are engaged in the same business. This occurs due to Competition arising due to many players targeting the same market in the same geographical area. The bank adopts credit management risk policies and financial management risk policies. The bank identifies areas where risk arises and in return sets out to prevent this risk through budgeting.
Budgeting includes the use of financial ratios to forecast the future. From the result analysis various ratios are
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Financing strategies are important since they influence transactions. The financing strategies of Islamic banks differ from those of conventional banks and they include equity-like contracts, asset-backed fixed return arrangements which include deferred payment sales (Murabahah), operating leases (Ijarah) and diminishing musharaka (Zaheer&Farooq(2013). According to Ahmed, Asutay & Wilson (2013) the institutions implement a strategy to ensure the existing portfolio of Islamic Banks financing display asset-backed measures making them comparatively less vulnerable especially in times of financial crises .The institutions therefore focus on stabilizing their operations during this hard economic times through preparing by indentifying factors that are likely to affect book value and interest …show more content…
Through employee performance it is clear; much is achieved in terms of organizational policies. From the research DIB many respondents were of the opinion that the bank is hiring new staffs and this is explained by the banks extension to new markets and its position as a major Islamic Bank globally. Further, a considerable number of the respondents agree that employees are in a position to achieve optimum performance. This is important as it increases the chances of increasing the value of shareholders and profit margin. It is clear that competence of the employees contributes to achievement in

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