Banking System Essay

2528 WordsMar 25, 201311 Pages
Introduction A bank refers to a financial institution that accepts deposits and channels the money into lending activities (Lewis, 2009). Ethics refers to the principles of right and wrong that are accepted by an individual or a social group ((Lewis, 2009).) Conceptually, ethics refers to well base standards of right and wrong that prescribe what humans ought to do, usually in terms of rights, obligations, benefits to society, fairness, or specific virtues (Safakli, 2005). It’s the integrity measure, which evaluates the values, norms and rules that constitute the base for individual and social relationships, from a moral perspective (Smith and Smith, 2002). It consists of choosing the good over the bad, the right over the wrong and the fair over the unfair. It makes claims about what ought to be done or what ought not to be done (Carse, 1999). Integrity implies not merely honesty but fair dealing and truthfulness (CAJEC, 1992). In an era of sustainable economic development models there is an increased attention on sectoral compatibility, environmental protection, and professional ethics (Safakli, 2005). Analyzing the recent bank failures it can be seen that the business and professional ethics is one of the most important elements of stability in banking and the finance sector. This is because the sectors are in particular very important instruments of speedy economic growth and development. The banking plays an important role in restructuring the economy and to bring about long-term sustainable macroeconomic stability. According to Deiss (2001), the success of banks, both in short and long term depend on the trust and confidence between all the parties. Ethical value s and behaviors in banking play a very important role in creating and maintain mutual trust and confidence; hence, banks should not underestimate the importance of ethical behavior, and morals,

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