Author: Zhou Minting, Xu Hanwen

Publisher: Department of Accounting 

Date: April 12, 2024

In a bid to unravel the intricate relationship between information technology and bank loan loss reserves, the School of Management at Jinan University recently hosted its 5th academic lecture on April 3nd. Spearheaded by Professor Wang Xinlu from the Department of Accounting, the event featured a captivating paper presentation titled Information Technology Adoption and Loan Loss Recognition by Associate Professor Tian Feng from the School of Accounting and Finance at the Hong Kong Polytechnic University.

(Tian Feng was speaking)

Against the backdrop of a burgeoning investment surge in information technology within the US banking sector, Professor Tian Feng underscored the pivotal role of IT as a catalyst for future banking evolution. Shedding light on the enigmatic interplay between banks, the real economy, and the financial ecosystem, the paper delved into the impact of information technology on bank financial reporting, with a specific focus on the timeliness of loan loss provisions (LLP).

Groundbreaking research unveiled during the lecture unveiled that heightened IT investments by banks markedly enhance the promptness of loan loss provisioning. This effect was particularly pronounced in banks with greater geographical dispersion between branches and headquarters, alongside a higher cadre of IT-proficient personnel. Furthermore, the study illuminated how IT investments not only augment internal information environments and mitigate operational errors but also streamline auditors' tasks, consequently curbing audit expenses.

The interactive session witnessed a vibrant exchange of ideas as attending faculty members and students delved into the nuances of the research, dissecting facets such as research motivation, indicator metrics, and theoretical underpinnings. The convergence of academia and industry insights at the JNU School of Management Academic Lecture heralded a new era of scholarly discourse and practical implications in the realm of banking and technology integration.