Banker confidence in financial stability and the impact of geopolitical awareness

Chapter 4
Findings
The purpose of this study was to determine if the international banking community feels confident that it can sustain another global economic crisis, and specifically whether geopolitical awareness impacts that confidence level. Confidence plays a significant role in how money is invested, where it is placed, and what markets will do. Therefore, assessing the confidence levels of bankers at the four major international banks (J. P. Morgan Chase, Deutsche Bank, HSBC, and Bank of China) is essential for understanding if the sector can safely handle another global economic crisis like that seen in 2007-2009 and to what degree if at all geopolitical awareness impacts that confidence level.
This chapter comprises four sections: (a) validity and reliability of the data, (b) results, (c) evaluation of the findings, and (d) a summary of results. The validity and reliability of the data section will discuss the overall study, factors impacting the interpretation of the data collection or analysis, provides an overview of the categorical demographic data collected, the validity and reliability of the Likert-type data collected, and the assumptions of the validity and reliability tests used to analyze the Likert-type data collected. 
Validity and Reliability of the Data
Validity concerns the accuracy of a measure and reliability concerns the consistency of a measure. In presenting the findings it is critical to discuss how accurately the data collected and analyzed reflects the reality of the information sought. Parametric inferential statistics
This study did not include a mixed-methods approach or multiple data sources, and thus it did not offer a triangulation of sources beyond the banking members who participated in the survey of the four central banks. This lack of triangulation places at least one constraint on the validity of the data in the sense that it means the findings are not tested for consistency across different data collection instruments. There may be other factors and variables not tested in this study influencing or affecting the outcome. 
The overall study showed that the data met the assumptions of the statistical test. The assumptions of the Pearson correlation test were negligible and included linearity. The assumptions of the t-test included random sampling, normality of data distribution, adequacy of sample size, and equality of variance in standard deviation. A total of 1000 emails were sent to a randomized sample of employees at J. P. Morgan Chase, Deutsche Bank, HSBC, and Bank of China, asking them to participate in a survey hosted on my LinkedIn page. A total of 641 participants took part in the survey.
The survey method is most often used in quantitative studies and the most common survey is the self-reported survey. Surveys can be complex or simple but are most frequently used to obtain data from a population regarding a research question that focuses on the correlation of variables or on issues of cause and effect (Walliman, 2017). The survey is conducted by first developing the survey questions or statements. Usually the Likert scale is used to make measuring responses easier. The Likert scale is a numbered scale of responses that indicates the degree to which the responder agrees or disagrees with a statement in the survey. When developing a survey, the researcher has to be careful that the statements are written in a way that the responses can be properly measured using such a scale, otherwise the data can be misleading—for instance, if with one statement a high value is given to responses that agree with statements that are positive towards the phenomenon in question but in another statement a high value is given to responses that agree with statements that are negative towards the phenomenon in question, the survey data results will be worthless. Thus, the survey should be piloted first to make sure it is effective. The advantages of the survey are that it is an easy way to collect information from a large group of participants without having to meet them all or interview them. A survey can be mass-distributed quickly and quickly taken without inconveniencing the participant. The disadvantages of the survey method are that self-reporting can lead to underreporting, which can negatively impact the validity and generalizeability of the survey and the study overall.
Evidence of Psychometric Soundness
Internal consistency reliability was assessed using Cronbach’s alpha. Internal consistency reliability was supported: Cronbach’s alpha was .80. Data analysis appropriate for the purpose and design would be: Internal consistency, Construct validity, and Item homogeneity. The following were tested: reliability and item homogeneity using Cronbach’s alpha, item-total correlations, and inter-item correlations; construct validity using factor analysis. Internal consistency reliability was assessed using Cronbach’s alpha, which tells how closely items in a group are related. Internal consistency reliability was supported: Cronbach’s alpha was .80, which indicates that the items had a relatively high degree of internal consistency. In the scientific community, reliability coeffecient > .70 is typically viewed as acceptable.
Results
This study has built on the idea that confidence plays a significant role in how money is invested. Everything from bond markets to equities markets to precious metals and blockchain is impacted by confidence (Haitsma et al., 2016). Banks should, therefore, have some sense of confidence levels in case another financial and economic crisis occurs. To assist in this discernment, this study provides a convenient tool for assessing confidence levels and providing a reading on the confidence of the associates of four major international banks. 
The demographics of participants consisted of sales specialists (39%), loan processors (22%), financial advisors (16%), investment banking analysts (15%), application analysts (5%), executive directors (3%), and risk analysts (2%), as shown in Table 1. Descriptive statistics of the independent and dependent variables are shown in Table 2.

Table 1
Demographics of Respondents
Job Position
Percentage of Respondents

Application Analyst
5%

Investment Banking Analyst
15%

Executive Director
3%

Risk Analyst
2%

Loan Processor
22%

Financial Advisor
16%

Sales Specialist
39%



The majority of the participants in the survey were in sales, which is a lower-level position. Loan processors made up the next highest level of participants, followed by financial advisors. Risk analysts made up only 2% of the respondents and executive directors only 3%, which could be a factor in skewing the results of the survey aware from any association between risk-adversity and geopolitical awareness or confidence. Considering that the majority of those surveyed were involved in sales and loan processing, it was expected that the data would naturally reflect a more positive view of the strength of the international finance industry considering that these individuals’ jobs and careers depended on industry-wide strength. Were it the case that factors such as geopolitics and increasing-debt levels at record highs could undermine the industry, it would present the possibility that the industry itself was fundamentally lacking in inherent strength. To assess these relationships, however, it is important to consider to the data in terms of the research questions asked at the outset of this study.

Research Question 1
Is the international banking community confident in its ability to handle another global economic crisis like the one experienced from 2007-2008?

Table 2 shows that in the international banking community, the most confidence was expressed by employees of HSBC and the Bank of China concerning the community’s determination that it can handle another global economic crisis. Employees of JP Morgan-Chase were overwhelmingly neutral-to-confident, however, and were by far the least concerned group of employees about difficulties that might be faced by another crisis. The recurring theme found in the survey responses was that employees felt that their banks were more prepared to handle another crisis. Here, the outlier was Deutsche Bank, where employees expressed very little confidence, with three out of four participants demonstrating a substantial lack of confidence in the industry’s ability to cope with another crisis. Employees at Deutsche Bank expressed minimal impression of the banks being prepared for what would happen. Of the four banks, employees at the Bank of China were the most optimistic, with only 5% of participants expressing a lack of confidence.

Table 2
Confidence levels of the Banking Community


Confidence


Bank
Not Confident
Neutral
Confident

JPMorgan-Chase
10%
50%
40%

Deutsche
75%
5%
20%

HSBC
25%
10%
65%

Bank of China
5%
35%
60%

Mean
28.75%
25%
46.2%



There did not appear to be any statistically significant correlation between the two variables regarding confidence and crisis perception. The p-value was more significant than 0.05, and thus, the null hypothesis was rejected. To test the assumptions of linearity, Pearson’s r and regression analysis were conducted using ANOVA. Pearson’s r for the data obtained was +.95, which indicates excellent reliability. The t-test p-value was above 0.05 for each of the three research questions, indicating that the null hypotheses for each should be rejected.
Model Summaryb

Model
R
R Square
Adjusted R Square
Std. Error of the Estimate

1
.164a
.027
-.017
6.8794

a. Predictors: (Constant), Crisis perception

b. Dependent Variable: Confidence




ANOVAa

Model
Sum of Squares
Mean Square
F
Sig.

1
Regression
57.875
28.937
.611
.547b


Residual
2082.370
47.327




Total
2140.245




a. Dependent Variable: Confidence

b. Predictors: (Constant), Crisis perception




Residuals Statisticsa


Minimum
Maximum
Mean
Std. Deviation
N

Predicted Value
4.295
9.089
7.511
1.1217
641

Residual
-7.9074
31.5980
.0000
6.7282
641

Std. Predicted Value
-2.867
1.416
.000
1.000
641

Std. Residual
-1.147
4.791
.000
.968
641

a. Dependent Variable: Confidence



The findings showed that the model was not statistically significant, as p > 0.05. The R-squared is less than 3%, so not a good predictor. The correlation between the variables was not especially meaningful.
Thus, aside from the outlier of employees at Deutsche Bank, there was no significant indication of an industry-wide lack of confidence among employees in the industry of international finance or correlation between perceptions of crises in the past and projections of fears for the future. Possible explanations for this lack of correlation could be that employees believed their employers had implemented the appropriate controls and policies in the wake of the 2008 crisis and that they were now better prepared to handle risk and volatility. Though this survey was conducted before the March 2020 market volatility related to the global spread of coronavirus, the rapid bounce back of the market over a matter of weeks suggests that the employees of these firms were possibly justified in their confidence that their institutions would be able to handle any volatility with relative ease.
One caveat in this explanation, however, is the role of the central banks of the world in injecting liquidity into markets through a variety of novel maneuvers, such as the purchasing of high yield junk bonds by the Federal Reserve and the outright purchasing of equities by the Bank of Japan. In response to the COVID 19 crisis, central banks injected 10 trillion+ USD into markets. Did employees of these firms suspect that central banks would be there to support markets as they were following 2008? Was this the source of their trust? Follow-up interviews or surveys with participants could perhaps help to answer that question and member checking was utilized for that purpose. Emails were sent to the participants to gauge whether they viewed the role of the central bank in supporting markets as having a major factor in their confidence in the industry overall. The overwhelming response of replies was affirmative, with 90% of respondents (240 total) stating that, yes, their impressions that the central banks would step in to bring stability to the market place and thereby to the international finance industry was the source of their confidence, since the central banks had set the precedent for exactly that type of activity in their response to the 2008 economic crisis.

Research Question 2
Does geopolitical awareness have an impact on the confidence of the members of the international banking community regarding the sector's ability to handle another global economic crisis like the one experienced from 2007-2008?

Throughout the international banking community, the employees of Deutsche Bank were most likely to be negatively impacted by awareness of geopolitical events, as can be seen in Table 3. Deutsche employees’ awareness of geopolitical stressors, such as the threat of an Iranian crisis, oil embargoes, the rise of domestic and international terrorism, or a new Cold War with Russia, all tended to linger in their minds in a negative way more than in the minds of employees of other banks. For other bank employees, geopolitical tension was seen as “bullish” for markets, as it created a heightened understanding of macro factors that could help investors to better understand where to move money, what to invest in, what flows to follow, and what risks to consider. For at least half of employees at JP Morgan-Chase, HSBC, and Bank of China, geopolitical awareness was positively correlated with confidence because these employees felt that by understanding geopolitical issues their bank was better situated to provide expert advice and guidance for their clients. For three-fourths of employees at Deutsche Bank, awareness of geopolitics did not inspire confidence but rather fear and dread. One explanation for this could be that these employees did not trust their firm to be able to navigate the fallout of geopolitical tension and conflict.
The question that arose, therefore, was whether employees’ confidence in their own firm moderated their confidence in their industry overall. Since the majority of employees in the community demonstrated a positive impact on confidence, as geopolitical awareness grew, it seemed necessarily to engage in member checking once more and follow-up the survey with an additional question to participants that was put in the context of COVID 19: Do you feel confident in your firm’s ability to navigate fallout from geopolitical conflict created by the conditions caused by the coronavirus pandemic? 152 respondents answered and 82% of them stated that they were confident in their firms. Of the 18% who did not express confidence, 75% were employees of Deutsche Bank. This suggests that Deutsche Bank is different from its peers in the industry, at least in terms of how employees perceive the company and its internal strength.
The key insight from this finding is that the firm’s reputation can impact employee perceptions of how to interpret geopolitical risk. If a firm’s reputation is strong, employees are more likely to consider geopolitical awareness in terms of how they can use to benefit clients and their firm and thus themselves. If a firm’s reputation is weak, employees are more likely to fear the fallout of geopolitical conflict and how it might impact their firm negatively and thus in turn impact their careers. This suggests that banks that lack internal strength or that are plagued by a an exodus of shareholders as Deutsche Bank has been in the past are less likely to have employees who believe that geopolitical awareness is something that they can use in their favor to assist clients. Instead their view any type of global tension or conflict as inherently risky and negative for the industry because they fear the impact it could have on weak firms like their own. Employees who view their firms as strong, on the other hand, will use geopolitical awareness with confidence because they are not worried that their own company may be adversely impacted by global conflict, and for that reason they are more inclined to embrace geopolitical risk or turmoil and use that understanding to help clients make the right investments or take out the right loans at the right time. Nearly half of all employees participating in the survey felt that geopolitical awareness gave them more confidence, not less, and nearly three-fourths of all employees felt that at the very least it had no negative impact on their confidence levels regarding the industry as a whole, as Table 3 shows.

Table 3
The Impact of Geo-Political Awareness on Confidence Levels


Impact


Bank
Negative Impact
No Impact
Positive Impact

JPMorgan-Chase
5%
45%
50%

Deutsche
75%
5%
20%

HSBC
25%
10%
65%

Bank of China
5%
35%
60%

Mean
27.5%
23.75%
48.75%



Still, there did not appear to be any statistically significant correlation between the two variables regarding confidence and geopolitical awareness. The p-value was more significant than 0.05, and thus the null hypothesis was rejected.
To test the assumptions of linearity, Pearson’s r and regression analysis were conducted using ANOVA.

Model Summaryb

Model
R
R Square
Adjusted R Square
Std. Error of the Estimate

1
.159a
.022
-.019
6.4793

a. Predictors: (Constant), Geopolitical awareness

b. Dependent Variable: Confidence




ANOVAa

Model
Sum of Squares
Mean Square
F
Sig.

1
Regression
56.692
28.937
.611
.547b


Residual
2082.370
47.327




Total
2140.245




a. Dependent Variable: Confidence

b. Predictors: (Constant), Geopolitical awareness





Residuals Statisticsa


Minimum
Maximum
Mean
Std. Deviation
N

Predicted Value
4.262
9.098
7.511
1.4566
641

Residual
-7.946
32.696
.0000
6.6512
641

Std. Predicted Value
-2.867
1.415
.0000
1.0000
641

Std. Residual
-1.146
4.582
.0000
.9690
641

a. Dependent Variable: Confidence



The findings showed that the model as a whole was not statistically significant, as p > 0.05. The R-squared is less than 3%, so not a good predictor of where confidence will be. The correlation between the variables was not especially meaningful in spite of the fact that the majority of respondents associated geopolitical awareness with confidence rather than with a weakening of confidence.

Research Question 3
Do changes in central bank monetary policy (i.e., going from quantitative easing to quantitative tightening) and the awareness of the rising debt levels around the world affect the confidence levels of the members of the international banking community on the sectors ability to handle another global economic crisis like the one seen from 2007-2008?

              The data indicates that awareness of central bank policy and rising debt levels has no significant impact on bank employees’ confidence levels.  Table 4 shows the effect of awareness of central bank monetary policy and increasing debt levels on confidence levels of bankers. Again, employees of Deutsche represent the least confident group, and J.P Morgan Chase employees demonstrated the most neutrality. HSBC and Bank of China employees demonstrated a positive correlation between awareness of the variables and confidence, though neither was statistically significant.
One possible for explanation for the positive correlation is that bankers at these firms again viewed awareness itself in positive terms rather than in negative terms. The idea that awareness can enhance relationships between bankers and clients is a theme that occurred again and again in the survey responses. Instead of seeing rising debt and central bank interventions as foreboding events heralding a major economic crisis, these bank employees saw awareness as something that they could use to help clients make the right decisions for themselves. By being aware of these events, catalysts, and signals sales specialists, financial advisors, loan processors, investment banking analysts and risk analysts could feel more confident in their own ability to do their banking duties. They responded that they could help clients feel informed, knowledgeable, helpful, and confident in their own decisions about how to invest, whether to take out a loan at a specific interest rate, or what types of financial products to buy. However, this type of confidence was not shared by all bank employees. Three-fourths of employees at JP Morgan-Chase felt that awareness of central bank monetary policy and rising debt levels played no part in how their confidence was formed. One reason for the lack of impact among JP Morgan-Chase employees might be found in JP Morgan-Chase’s own organizational culture and risk aversion strategies that were being implemented under the guidance of Jamie Dimon. Dimon himself was critical of the amount of rising debt and the role that the central bank was playing via monetary policy in the tightening of credit. Deutsche employees were by far the most negatively impacted by this awareness with nearly one in two employees of the German firm feeling that their confidence in the international banking industry was shaken by the rising global debt and the monetary policy of central banks around the world. The question that remained was whether employees of Deutsche felt shaken in the confidence by this awareness because they believed their bank lacked internal strength and that all banks were like their firm or whether it was some other reason. A post-survey question was put to these employees using member checking and the employees who responded (74 total) answered that they saw little long-term reason to be confident in the system period as free markets, especially now in light of the response to the COVID 19 crisis, were fast resembling a command economy. Of the participants who reported being shaken in their confidence, the loss of a free market was the most cited concern followed by a concern about a collapse in USD and a default on sovereign debt that would totally upend the system and lead to open conflict and a global hot war among nations. This was one extreme of feeling among a minority population of bank employees. The more common feeling among the majority of employees was that monetary policy and rising debt had either no effect or else a positive effect on their confidence levels.

Table 4
The Effect of Central Bank Monetary Policy and Awareness of Increasing Debt Levels on Confidence Levels


Effect


Bank
Negative Effect
No Impact
Positive Impact

JPMorgan-Chase
15%
75%
10%

Deutsche
45%
25%
30%

HSBC
25%
10%
65%

Bank of China
5%
35%
60%

Mean
22.5%
36.25%
41.25%




There did not appear to be any statistically significant correlation between the two variables regarding confidence and awareness of debt levels rising/central bank monetary policy. The p-value was more significant than 0.05, and thus, the null hypothesis was rejected.
To test the assumptions of linearity, Pearson’s r and regression analysis were conducted using ANOVA.
Model Summaryb

Model
R
R Square
Adjusted R Square
Std. Error of the Estimate

1
.141a
.023
-.016
6.6831

a. Predictors: (Constant), Awareness of central banking monetary policy and increasing debt levels around the world

b. Dependent Variable: Confidence




ANOVAa

Model
Sum of Squares
Mean Square
F
Sig.

1
Regression
53.875
28.535
.642
.539b


Residual
2062.862
46.345




Total
2162.182




a. Dependent Variable: Confidence

b. Predictors: (Constant), Awareness of central banking monetary policy and increasing debt levels around the world




Residuals Statisticsa


Minimum
Maximum
Mean
Std. Deviation
N

Predicted Value
4.295
9.099
7.511
1.121
641

Residual
-7.907
31.598
.000
6.728
641

Std. Predicted Value
-2.867
1.416
.000
1.000
641

Std. Residual
-1.149
4.593
.000
.978
641

a. Dependent Variable: Confidence



The findings showed that the model was not statistically significant, as p > 0.05. The R-squared is less than 3%, so not a good predictor. The correlation between the variables was not especially meaningful. Thus in spite of the associations that could be drawn statistical significance was not found. Interpretations of the data could not be, therefore, corroborated or supported by quantitative statistical analysis. In the end, the data suggests that more inquiry is required, either to further explore variables that might be factors in affecting confidence or to better understand the viewpoints of employees of these banks and what they perceive to be directly influencing their confidence.
Evaluation of the Findings
Research Question 1
Is the international banking community confident in its ability to handle another global economic crisis like the one experienced from 2007-2008?
The bankers surveyed at J.P. Morgan Chase and Bank of China were by far the most optimistic of the participants surveyed, while Deutsche employees were least optimistic in terms of their view on the strength of the industry. Overall, there did not appear to be any statistical significance, though some consistency among patterns of responses among certain participants from certain banks could be identified. In terms of confidence, employees who displayed the most worked for firms that were solidly established and whose share price had not been adversely affected in recent years by a declining reputation the way Deutsche Bank’s had been. It is possible therefore that a lack of sense of security might be at play for employees whose confidence was negatively impacted by the thought of economic crisis. Rational choice theory would suggest that employees who did feel shaken by the thought of navigating another economic crisis were experiencing a loss of confidence because the data they were inputting indicated a likely negative future for themselves. From a mission command perspective, they might be seen as the ones who would seek to adapt and find an alternative path forward. An interesting investigation that might be pursued on this point is whether turnover rates are high among employees who reported that their confidence was lacking at the thought of facing another economic crisis. This could be determined by surveying respondents’ intention to stay. The question was not put to respondents but the findings do suggest that it may be a future inquiry point worth pursuing.
Another consideration, however, may be to apply Maslow’s theory of motivation to the matter and using a different theoretical framework for interpreting the data. For what if rational choice theory and the concept of mission command only partially explain the findings? What Maslow’s theory of human motivation plays an equally important role in understanding the data? Here may be the key to further unlocking the meaning of the data. An investigation into whether employees with a lack of confidence are having their lower level needs met could be revealing and help with future analysis.
Research Question 2
Does geopolitical awareness have an impact on the confidence of the members of the international banking community regarding the sector's ability to handle another global economic crisis like the one experienced from 2007-2008?
The findings here were mixed. Geopolitical awareness shook the confidence of some and bolstered the confidence of others. The reasons given revealed two concurrent themes: on the one hand, awareness helped already confident bank employees to feel even more confident because they saw themselves as more informed and therefore better able to assist clients in making good investment decisions. Those who were already lacking in confidence were made less confident if they considered geopolitical risk factors as well, for they saw these risks as a threat to their own job security. One explanation for this feeling was that they simply did not trust their bank to be able to withstand geopolitical tremors that might spread around the world should conflict escalate and roil markets and economies simultaneously. The revealing finding here was that employees who lacked confidence were made even less confident by awareness, and employees who were confident in their banks were made more confident in their awareness of geopolitics. Some who demonstrated geopolitical awareness and could appreciate the risk that geopolitics held for markets expressed more confidence in their banks to be able to withstand any stressors as well as confidence in themselves to be able to guide clients and perform their duties based upon their knowledge. However, in spite of these associations and correlations there was no statistically significant correlation among the variables, and the null hypothesis was rejected once more. Nonetheless, the patterns of responses among employees indicates that themes for future exploration do exist and might be positively pursued.
Research Question 3
Do changes in central bank monetary policy (i.e., going from quantitative easing to quantitative tightening) and the awareness of the rising debt levels around the world affect the confidence levels of the members of the international banking community on the sectors ability to handle another global economic crisis like the one seen from 2007-2008?
The same pattern of confidence was found in response to this research question as in the other two: those bank employees who were confident in their firm and in themselves were not negatively impacted by awareness of monetary policy and rising debt levels. They saw awareness as a positive rather than as a negative even if the facts that they were aware of could be perceived as negative. The individuals who had confidence saw information as a tool that they could use to be better at their jobs, whether that were selling financial instruments to clients or analyzing loans. If they trusted the industry, the regulations in place, their firms and themselves, they were not put off by dire reports of rising debt or ill effects of policy errors by committed by central banks.
On the other hand, if employees did not have that level of confidence and did not have a high level of trust in their firm or in the industry, negative reports of potential policy error related to central banks’ monetary policy and rising debt levels was found to further exacerbate their fears and reduce their confidence still lower. Employees of Deutsche represented the least confident group, and J.P Morgan Chase employees demonstrated the most neutrality. In contrast, HSBC and Bank of China employees demonstrated a positive correlation between awareness of the variables and confidence, though neither was statistically significant. Overall, there was no statistically significant correlation between awareness of debt levels and confidence, and therefore the null hypothesis was rejected a third time. Nonetheless, the associations between workers of the firm with the declining reputation and share price were overall less confident than their peers at firms perceived to have a stronger reputation. This suggests that there may be more to the issue of confidence than mere awareness of risks and crises. For that reason, a rational choice framework with an emphasis on mission may not be the best approach to understanding this data. This realization is discussed more in the next section.
What the Findings Mean
The findings indicate that there are no significant correlations between geopolitical awareness and bank employees' confidence or between debt levels and bank employees' confidence. Geopolitics, monetary policy, debt and economic crisis awareness do not appear to be universal factors that decrease bank employees' confidence levels about their banks being able to sustain a global economic crisis or their own ability to do their jobs. However, certain associations were made that could help to explain some patterns perceived in the survey and post-survey follow-ups via member checking. What the associations suggested was that confidence existed in the employees prior to any awareness and that awareness fueled whichever way confidence levels were trending among workers. If workers were losing confidence, awareness of these factors increased the loss. If workers were gaining or were already confidence, awareness increased that gain or bolstered that confidence. The awareness in and of itself was not necessarily a major factor in determining the confidence of employees in the international banking industry. Something else was contributing to their confidence formation and development.
One possible explanation from the rational choice and mission command framework suggests that bank employees do not question policy or mission in the light of developing geopolitical situations or increasing debt levels around the world. Rather, they question their own futures in the industry if they perceive a potential threat to their job security. It does appear that bank employees have different views and opinions on the state of markets, the role of central banks, and the impact of geopolitics depending on what bank employs them. Employees of Deutsche Bank showed far less confidence in the system's sustainability overall as compared to JP Morgan. This may indicate that another factor is influencing the results, such as the perceived internal stability of the bank employing the worker, for there is no uniformity or consensus among the bank employees overall. Overall, the findings are consistent with existing literature that a sense of moral hazard or a sense of a lack of confidence has not grown among bank employees. It appears as Pikulina et al. (2017) point out that lessons from 2008 have not been learned and that history could be on the verge of repeating itself. On the other hand, Pikulina et al. (2017) could be interpreted as having a negative opinion of the utility of the facts and of having a lack of trust or confidence in the industry that influences their outlook and interpretation of their own findings. If one is already confident, it may not be a matter of ignorance of risks or events. It may simply be a matter of understanding the utility of this information and whether one has reached a level of self-actualization in one’s own life. To pursue that line of thought, however, would require applying another theoretical approach, such as Maslow’s (1943).
In the light of the theoretical framework of the study, rational choice theory, which posits that individuals or organizations make decisions based on the weighing of costs and benefits, the results suggest that one need not know costs or benefits as they appear in reality or one's mind because one accepts that the international banking sector is too big to fail. According to the theoretical framework, if one is not confident about the costs and benefits, one cannot proceed effectively in the decision-making process. However, the bank employees of the majority of banks did not bear this sentiment out in their responses. This suggests that the approach is inadequate in making sense of the responses.
Reasons for confidence included the belief that banking models were capable of withstanding stress in the system; the central banks would provide sufficient liquidity; regulations had been put in place that would prevent a similar crisis from occurring again, and that geopolitical risk was not a factor in today's market, which was supported by the now conventional monetary policy of central banks around the world intervening in markets to support them. The bankers overall held the view that the markets were necessary for developed worlds to maintain social order, as pension funds, insurance funds, sovereign wealth funds, and mutual funds all depend upon the marketplace offering a stabled ROI. The majority of them were satisfied that governments would not let markets fail.
The overall study was designed to measure whether the international banking community felt confident that it could withstand another crisis like the one experienced in 2008. For the most part, bankers responded that they were confident in the industry's stability and strength. Deutsche Bank employees represented something of an outlier, but this could be explained by the fact that Deutsche Bank's reputation and the share price has itself collapsed in recent years due to systemic problems with risk, leverage, and regulations.
Other possible theoretical approaches that could offer different interpretations on the findings might include Maslow’s (1943) theory of human motivation and the hierarchy of human needs. It was Maslow’s (1943) belief that self-esteem was a crucial factor needed on the road to self-actualization. To obtain it, one has to receive love from others, which in turns helps the person to build his confidence and sense of self-worth. If the person never receives any love or esteem from others, such as parents, teachers, friends or family, his self-esteem is likely to be low and his sense of self-value likely to be nil (Cosentino, 2020). Self-esteem is thus something that cannot be dismissed as it contributes to the development of the individual and supports having a happy and successful life. So how could self-esteem be linked to the data from the survey of international bank employees? Self-esteem and the other factors that enable one to be self-actualizing according to Maslow’s model could be variables that might play a part in the feelings of confidence of these employees. Because the data was not approached from this perspective but rather from the theoretical standpoint of rational choice theory, needs theory was not applied. But were it to be applied, a new interpretation on the data could be produced that could then take further inquiry into an entirely different direction—particularly with respect to the topic of what firms can do to help empower employees to become confident, self-actualizing employees.
Summary
Employees of Deutsche Bank were outliers among employees of the other three banks regarding confidence in the international banking system to withstand a crisis of similar proportions to that of 2008. There was no clear indication, however, of any symmetry among views of employees of any of the four banks regarding the impact of geopolitical developments or central banking intervention in the markets or the levels of debt in the world's countries. The participants indicated in general that confidence was mainly based on the awareness that the international banking system was much better regulated today than a decade ago and that central banks were more prepared to intervene to keep the system stable. This confidence was felt most strongly among employees of JP Morgan-Chase, HSBC, and Bank of China. The application of the rational choice and mission command theoretical framework only partially explains the feelings of confidence as expressed by participants. Applying a theoretical approach that uses a focus on needs theory, such as Maslow’s hierarchy of needs model, could be more beneficial in understanding whether certain workers in the banking industry are negatively impacted by negative reports of risk in the world because they lack the internal confidence that comes with self-actualization.