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Jan 22, 2015 · Capital regulation acts as an external force in the determination of bank capital and risk levels. Changes in the regulatory framework can influence banks’ decisions. Starting from the debate of the prudential regulation after the financial crisis, this paper reviews the main empirical contributions on the role of capital regulation in the determination of banks’ capital ratios and risk ...
- Alessandra Tanda
- 2015
Oct 1, 2018 · In models (1)–(10), the dependent variables is the natural log of the Z-score (Lnz-score). lnTA is the natural logarithm of bank total assets, ASTGR is the growth rate of a bank's assets, EQAS is bank capitalization, LOAN is loans to total assets, LLPL is the loan loss provisions, HHI is the Herfinfahl-Hirschman Index for bank industry concentration based on loans, CGOV is the corporate ...
- Theodora Bermpei, Antonios Kalyvas, Thanh Cong Nguyen
- 2018
We consider the value of the IMPAIRED variable in 2009 in order to take into account the increased levels of default rates in our sample because of the crisis episode and its potential impact on the capacity of capital and liquidity to affect the supply of new loans. In columns (1), (3), and (5), we use the LCR variable as the one related to ...
- Salvatore Polizzi, Enzo Scannella, Nuria Suárez
- 2020
These findings are further supported by recent research showing that stringent capital regulation reduces bank default risk during normal growth periods (Ashraf et al., Citation 2020), and that the quality of capital plays a pivotal role in reducing bank risk (Anginer et al., Citation 2021), emphasizing the multifaceted relationship between capital regulations, risk-taking, and efficiency in ...
Jun 1, 2018 · We do so by developing in Section 2 a theoretical model that includes regulatory compliance and other fixed costs, capital regulation that constrains bank lending, a potentially varying number of banks in an imperfectly competitive setting, and monitoring choices by banks that determine aggregate loan quality.
- Enzo Dia, David VanHoose
- 2018
Aug 1, 2006 · To focus on endogenous loan default, we make the following assumptions: 1. Banks optimally choose between two levels of exposure to loan default; 2. One level of loan-default exposure requires the monitoring of loans by the bank; 3. Monitoring loans is costly, and these monitoring costs are heterogeneous across banks;
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Aug 31, 2021 · Likewise, Polizzi et al. discovered that liquidity coverage, net stable funding and tier 1 capital ratios impacted positively on the growth of bank loans in 117 developed and developing economies during the period 2000–2016, while Roulet established that liquidity regulation indicators had a positive impact on the growth rate of bank lending in 22 European countries over the period 2008–2015.
