Macroprudential policies, corporate governance and bank risk: cross-country evidence
Macroprudential policies, corporate governance and bank risk: cross-country evidence
The present study uses a sample of up to 356 banks from 50 countries over the period 2002–2017 to examine whether and how macroprudential policies and corporate governance interact in shaping bank risk. Our results show that the impact of bank corporate governance on risk-taking depends critically on the macroprudential policies in force. In more detail, bank corporate governance has a negative or insignificant impact on bank stability when none or only a few macroprudential policies are in place; however, the impact becomes positive and statistically significant as the number of macroprudential policies increases. These findings seem to be attributed to financial institutions targeted macroprudential instruments rather than borrowing targeted ones. The results are robust to the use of various indicators of risk and numerous additional tests.
126-142
Gaganis, Chrysovalantis
a66db976-d7d1-4a85-8057-d2cde46f0d33
Lozano-Vivas, Ana
0380df45-429b-491b-84e2-21a4ca49714e
Papadimitri, Panagiota
b7edf14e-3b00-4317-a6ce-8741b593d5b0
Pasiouras, Fotios
48097419-7f9d-4bd4-93a0-6ae59bdf9a0e
1 January 2020
Gaganis, Chrysovalantis
a66db976-d7d1-4a85-8057-d2cde46f0d33
Lozano-Vivas, Ana
0380df45-429b-491b-84e2-21a4ca49714e
Papadimitri, Panagiota
b7edf14e-3b00-4317-a6ce-8741b593d5b0
Pasiouras, Fotios
48097419-7f9d-4bd4-93a0-6ae59bdf9a0e
Gaganis, Chrysovalantis, Lozano-Vivas, Ana, Papadimitri, Panagiota and Pasiouras, Fotios
(2020)
Macroprudential policies, corporate governance and bank risk: cross-country evidence.
Journal of Economic Behavior & Organization, 169, .
(doi:10.1016/j.jebo.2019.11.004).
Abstract
The present study uses a sample of up to 356 banks from 50 countries over the period 2002–2017 to examine whether and how macroprudential policies and corporate governance interact in shaping bank risk. Our results show that the impact of bank corporate governance on risk-taking depends critically on the macroprudential policies in force. In more detail, bank corporate governance has a negative or insignificant impact on bank stability when none or only a few macroprudential policies are in place; however, the impact becomes positive and statistically significant as the number of macroprudential policies increases. These findings seem to be attributed to financial institutions targeted macroprudential instruments rather than borrowing targeted ones. The results are robust to the use of various indicators of risk and numerous additional tests.
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More information
Accepted/In Press date: 3 November 2019
Published date: 1 January 2020
Identifiers
Local EPrints ID: 469692
URI: http://eprints.soton.ac.uk/id/eprint/469692
ISSN: 0167-2681
PURE UUID: be3c6e4d-ed2a-4e18-9668-415f7c02d113
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Date deposited: 22 Sep 2022 16:37
Last modified: 17 Mar 2024 04:13
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Contributors
Author:
Chrysovalantis Gaganis
Author:
Ana Lozano-Vivas
Author:
Panagiota Papadimitri
Author:
Fotios Pasiouras
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