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Jan 21, 2015 · However, the opposite case, when banks are too risk-averse, has similarly clear macro-economic consequences, posing the risk of asphyxiating an economy’s innovation and growth potential. A corresponding “vicious cycle” would start with weak businesses (without proper financial reporting) and unknown start-ups, which leads to considerable ...
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Aug 1, 2023 · Supporting this theory, studying non-financial firms, John et al. (2008) find a positive association between shareholder protection and the managers’ incentives to undertake riskier but possibly more value-enhancing investments, while for banks, Laeven and Levine (2009) show that banks with more powerful shareholders have a tendency to undertake more risks.
Jun 7, 2019 · Risk. June 7, 2019 The world is changing in ways that are reshaping the risk landscape. We see three inter-related changes as particularly relevant for banks. First, the digital revolution is drastically increasing the availability and use of data, and the speed at which decisions are made. Second, technological innovation is accelerating ...
They described an industry transformed by the 2023 regional bank crisis: regulators and exams have been more demanding, with a belief that this will continue to be the case in the immediate term, risk teams have a larger strategy role, and there is greater appreciation for the speed of risk. Meanwhile, non-financial risks including data breaches and fraud remain urgent.
Feb 28, 2022 · As nonfinancial companies move from enterprise risk management to a resilience-based approach, their experience in nonfinancial risk can provide a model for banks. Financial institutions, especially banks, have long been the leaders in developing advanced approaches to managing financial risks—credit risk, market risk, and funding and ...
Mar 30, 2012 · Risk-taking by banks played a critical role in the global crisis and Eurozone crisis. This column introduces a new eReport that focuses on four aspects of excessive risk-taking by banks, highlighting the causes and the cures. The eReport applies the best available theory and data, bringing together the main insights and views that have emerged from the crisis.
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Mar 1, 2018 · A sound banking system has always been considered a pillar of stability and sustainable economic growth. Deemed to lie at the heart of the recent financial crisis, bank failures and riskiness have drawn renewed and widespread attention that, more than ever before, put banks under the scrutiny of regulators and supervisors. 1 Examining ownership structure and bank risk taking, Barry et al ...
