Purpose: The purpose of this paper is to analyze whether investors perceive the issuance of sukuk differently than they do in case of conventional bonds, by using event study with superior data. Then, it analyzes whether financial characteristics of issuers can explain the abnormal return and likelihood of sukuk issuance. Finally, the paper proposes a testable model explaining the investor reaction.Design/methodology/approach: This paper uses market model event study to assess investor reaction to the issuance of sukuk. Then, linear and logistic regressions are used to test whether financial characteristics of issuers can explain the abnormal return and likelihood of sukuk issuance. To investigate the differences between sukuk issuers and bond issuers, this paper tests the difference in means of issuer characteristics. Finally, the sample is subdivided into good and bad firm prospects according to dividend/earnings ratio and book-to-market ratio. The subdivisions are used to test the proposed model explaining the investor reaction.Findings: The study finds that a large variety of firms issues sukuk. The event study reports significant negative abnormal returns around the announcement date of sukuk issuance. The study also reveals that the earning prospect of issuer firms affect the investor reaction. Firms with lower earning prospect receive a negative reaction from the investors. Also, smaller, or financially unhealthy firms are more likely to issue sukuk. Smaller and riskier firms issue sukuk, because participation in the market is less constrained. In other words, the risk-sharing nature of sukuk might imply that the firm is not confident about the future prospect. However, if the firm has good earnings prospects, investors react to the issuance of sukuk negatively.Research limitations/implications: Reliability and availability of data is a hurdle to test the investor reaction model. As more data become available, the models implications can be further tested.Originality/value: This paper uses the most complete set of data to study sukuk, making it the most selection bias-free and complete study. Moreover, the proposed investor reaction model will enrich the theory.

Purpose: The purpose of this paper is to investigate proprietary data from customers of a Southern Louisiana credit union. It analyzes the factors that contribute to an accelerated failure time (AFT) using information from customers’ credit applications as well as information provided in their credit report. Design/methodology/approach: This paper investigates the factors that affect credit risk using survival analysis by employing two primary models – the AFT model and the Cox proportional hazard (PH) model. While several studies employ the Cox PH model, few use the AFT model. However, this paper concludes that the AFT model has superior predictive qualities. Findings: This paper finds that the factors specific to borrowers and local factors play an important role in the duration of a loan. Practical implications: This paper offers an easily interpretable model for determining the duration of a potential borrower. The marketing department of credit unions can then use this information to predict when a customer will default, thus allowing the credit union to intervene in a timely manner to prevent defaults. Further, the credit union can use this information to seek out customers who are less likely to default. Originality/value: This study is different from the previous research due to its focus on credit unions, which have distinct characteristics. Compared to similar lending institutions, the charter of the credit union does not allow management to sell off loans to other investors.

In 1971, the patent for the Automated Teller Machine was awarded to David Wetzel. While possibly not the first application of financial technology, since 1971 time, the innovation in the financial industry has grown beyond expectations. However, most studies in innovation ignore the financial sector altogether. In this study, the authors investigate financial technology firms and innovation. After identifying firms that are considered financial technology, the authors collect innovation outcomes such as patents and data breaches associated with those firms. The authors show that patent activity has enjoyed modest growth year over year; however, firms still have challenges to overcome such as market risk and data security. This study serves as a perspective on financial technology.

This research investigates the relationship between the adoption of internal fintech solutions and the profitability of banks in Kosovo, leveraging the Technology Acceptance Model and Innovation Theory. The study analyzes the impact of mobile banking, e-banking, electronic payment systems, and data analytics on profitability using net interest margin (NIM) and return on assets (ROA) as key metrics. A mixed-method approach was adopted, combining audited financial report data from Kosovo’s commercial banks with survey data to ensure comprehensive analysis. To explore this relationship, a structured questionnaire was administered to 169 bank employees across 10 commercial banks in Kosovo. The sample included professionals from finance, technology, credit analysis, and customer service departments, chosen for their direct involvement in fintech adoption and its implementation. This selection ensured insights from individuals who actively engage with fintech tools and their impact on bank operations. Findings reveal that fintech adoption impacts profitability based on focus. Investments in operational efficiency negatively affect ROA (β = –0.079, p < 0.001), while fintech adoption targeting business opportunities, credit cost reduction, and customer understanding improves ROA and NIM. Business opportunities enhance ROA (β = 0.053, p < 0.01) and NIM (β = 0.098, p < 0.001), while customer understanding increases ROA (β = 0.143, p < 0.001). Mobile banking, digital lending, and bank age also show positive effects.