Griffith moves RBF relationship forward

Fiji's banking system has remained strong since 2000, even during and after the global financial crisis.

A research initiative involving Griffith Business School and the Reserve Bank of Fiji (RBF) has received funding under the Australia Awards Fellowships administered by the Department of Foreign Affairs and Trade.

The $86,224 project will fund a capacity development training program, involving six Fellows from the RBF, on banking sector and economic research and policy formulation at the Bank.

Potential knock-on benefits for banking institutions across the South-Pacific region are also on the cards.

Collaborations with the Reserve Bank of Vanuatu are underway, while avenues are being explored with the Central Bank of Papua New Guinea.

The partnership between Griffith Business School and the RBF is led by a team from the Department of Accounting, Finance and EconomicsDr Parmendra Sharma, Professor Eduardo Roca, Dr Jen Je Su, Dr Katherine Hunt, Dr Benjamin Liu, Dr Suman Nuepane and Associate Professor Mark Brimble.

Parmendra-Sharma“We have been engaging with government and private sector institutions in the South Pacific and have been developing a working relationshipwith the Reserve Bank of Fiji during this time,” Dr Sharma (left) said.

“The Australia Awards Fellowship has opened doors to other financial institutions and organisations, and we have been approached by private firms and development organisations for possible consultancies and collaborations.”

The initial partnership between Griffith Business School and the RBF led to a research paper assessing for the first time Fiji’s banking stability and efficiency on a global scale since the turn of the century. This provided a new insight which revealed the country’s banking system had remained strong since 2000, even during and after the global financial crisis.

“Taking into consideration ongoing economic uncertainty and Fiji’s own socio-economic conditions, we anticipated banking stability and efficiency was likely to have been adversely affected,” Dr Sharma said.

“However, Fiji’s banking sector has done well to remain stable and profitable. It is a country with a unique setting, perceived to be disadvantaged from a macro—economic and socio—political perspective. Yet its banking performance has rivalled the best in the world.

“A combination of prudent banking and regulation, with minimum state interference appears to have worked effectively, and potentially offers important lessons for other developing economies around the world.”

The Australia Awards Fellowship, to be rolled out from June 29 to July 10, provides an opportunity to produce the next set of joint working papers examining unconventional monetary policy in Fiji during the last decade, the adequacy of microfinance and mobile banking regulatory framework, and the effects of bank reforms on the efficiency of banks.

“This is anoutcome of a lot of important work in building relationships and trust with partners,” Associate Professor Mark Brimble, Discipline Head of Finance and Financial Planning, Griffith Business School, said.