Identifying and Prioritizing Factors Influencing Financial Innovations to Reduce Stock Price Crash Risk in Banks Listed on the Stock Exchange
Keywords:
Model design, financial innovations, risk reduction, stock exchange, data-based theoryAbstract
The study aims to develop a comprehensive model to identify and prioritize factors influencing financial innovations that mitigate stock price crash risk in banks listed on the stock exchange. This mixed-method (qualitative–quantitative) and applied research was conducted in two phases. In the qualitative phase, semi-structured interviews were conducted with 22 financial experts and academic specialists selected through purposive and snowball sampling until theoretical saturation was achieved. Data were analyzed through open, axial, and selective coding, resulting in 96 concepts and 24 categories. In the quantitative phase, a 96-item questionnaire derived from the conceptual model was distributed among institutional shareholders and brokers in the Iranian over-the-counter market. Data analysis was performed using structural equation modeling to examine the model’s fit and validate relationships among variables. The confirmatory factor analysis revealed four central categories—human resource management, organizational culture, IT infrastructure, and external financial resources—as the main drivers of financial innovation. Among causal conditions, interest rate, exchange rate volatility, political and social factors, and transaction transparency had the most significant effects. The model exhibited strong fit indices (RMSEA < 0.05; NFI and CFI > 0.90). Path coefficients indicated that organizational culture (β=0.99) and human resource management (β=0.96) were the strongest determinants in reducing stock price crash risk. Financial innovations supported by advanced technological infrastructure, an innovative organizational culture, skilled human resources, and diversified financial resources play a vital role in preventing stock price crashes in banking institutions. The proposed model provides practical insights for policymakers and banking executives to enhance financial stability and innovation performance within the capital market framework.
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Copyright (c) 2025 fatemeh ahmadi (Corresponding author); mehdi hasani, lida azizpor, rahmatalah mohamadipor, karen tatahi (Author)
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