Texas Tech University

Finance Graduate Student Honored with Scholarship to Attend Community Banking Conference

Raymond Kim
Raymond Kim

Raymond Kim, a graduate student in finance in the Texas Tech University's Rawls College of Business will be honored as an emerging scholar at the Community Banking and Policy Conference Sept. 28 in St. Louis.

The conference will award the emerging scholars with a scholarship to attend their conference at St. Louis Federal Reserve Bank. Kim plans to use the scholarship as a way to further his research as a doctoral candidate in finance at the Rawls College of Business.

By attending and participating in research presentations at the conference, Kim hopes to fulfill gaps of knowledge he said he lacks and surround himself with established Federal Reserve economists and community banking executives. At the conference, Kim will hear from different perspectives between practitioners, academics, and bank regulators to see where his research can help in an idealistic way.

“Community banking conferences are especially important because academics and regulators want to prevent another financial crisis from happening again,” Kim said. “It would not be possible to do important research in this field without going to conferences such as this particular one.”

His research interest is focused on macro-finance and banking, which allows him to explore the traditional benefits of community banking. For example, Kim said, is that community banks rely more on relationship lending than larger Wall Street banks. Smaller local banks usually have a closer relationship with people who borrow money. This tends to give the bank more insight on what the borrower can do and how their business is functioning. This is especially important in local industries such as farming and small businesses.

“Ever since investment banks and commercial banks merged in 1999, banking changed in many ways,” Kim said. “I remember my dad often relied on relationship banking to export American construction machinery, some coincidentally made here in Lubbock, to overseas markets.”

Through his research, he has written a paper called, “Too Big to Lend? The “Invisible Hand” in Banking”  It was honored as best paper in financial institutions award and is a semifinalist at the Financial Management Association Conference, which has more than 1,700 submissions from academics and is rarely given to solo authors. He plans to refine his paper after attending the community banking conference with the new knowledge he will receive.

Prior to Texas Tech, Kim worked on Wall Street for almost 10 years. Over time he realized there were structural problems within the financial markets. He also found that Wall Street firms were not incentivized to fix these problems, but only accepted and anticipated them. He decided to transfer to Texas Tech to pursue academia and research solutions to the problems at hand.

As Kim's adviser, Scott Hein, faculty director and professor in the Rawls College of Business, introduced him to the conference in hopes it would provide a good opportunity for his research.

“Raymond is most deserving of this selection as he has already begun to establish a serious initiative to better understand our banking system and especially the role that a community bank plays in the overall economy, and how their business model is really different than their more commonly known large bank brethren,” Hein said.

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