Publication:
Corporate Governance and Bank Insolvency Risk : International Evidence

Simple item page
dc.contributor.authorAnginer, Deniz
dc.contributor.authorDemirguc-Kunt, Asli
dc.contributor.authorHuizinga, Harry
dc.contributor.authorMa, Kebin
dc.date.accessioned2014-10-02T20:31:42Z
dc.date.available2014-10-02T20:31:42Z
dc.date.issued2014-09
dc.description.abstractThis paper finds that shareholder-friendly corporate governance is positively associated with bank insolvency risk, as proxied by the Z-score and the Merton's distance to default measure, for an international sample of banks over the 2004-08 period. Banks are special in that "good" corporate governance increases bank insolvency risk relatively more for banks that are large and located in countries with sound public finances, as banks aim to exploit the financial safety net. Good corporate governance is specifically associated with higher asset volatility, more nonperforming loans, and a lower tangible capital ratio. Furthermore, good corporate governance is associated with more bank risk-taking at times of rapid economic expansion. Consistent with increased risk-taking, good corporate governance is associated with a higher valuation of the implicit insurance provided by the financial safety net, especially in the case of large banks. These results underline the importance of the financial safety net and too-big-to-fail policies in encouraging excessive risk-taking by banks.en
dc.identifierhttp://documents.worldbank.org/curated/en/2014/09/20163225/corporate-governance-bank-insolvency-risk-international-evidence
dc.identifier.urihttps://hdl.handle.net/10986/20343
dc.languageEnglish
dc.language.isoen_US
dc.publisherWorld Bank Group, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper;No. 7017
dc.rightsCC BY 3.0 IGO
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectACCOUNTING
dc.subjectADVERSE EFFECTS
dc.subjectASSET GROWTH
dc.subjectASSET VALUE
dc.subjectASSET VALUES
dc.subjectASSETS RATIO
dc.subjectAUDIT COMMITTEE
dc.subjectAUDITING
dc.subjectAUDITORS
dc.subjectBALANCE SHEET
dc.subjectBANK ACTIVITIES
dc.subjectBANK ASSET
dc.subjectBANK ASSETS
dc.subjectBANK BAILOUTS
dc.subjectBANK CAPITAL
dc.subjectBANK CAPITALIZATION
dc.subjectBANK FAILURE
dc.subjectBANK FAILURES
dc.subjectBANK HOLDING
dc.subjectBANK HOLDING COMPANIES
dc.subjectBANK INSOLVENCY
dc.subjectBANK LENDING
dc.subjectBANK LIABILITIES
dc.subjectBANK LOAN
dc.subjectBANK LOANS
dc.subjectBANK REGULATION
dc.subjectBANK RISK
dc.subjectBANK SIZE
dc.subjectBANKING INDUSTRY
dc.subjectBANKING SECTOR
dc.subjectBANKRUPTCY
dc.subjectBANKS
dc.subjectBOOK VALUE
dc.subjectBUDGET BALANCE
dc.subjectBUSINESS CYCLE
dc.subjectCALL OPTION
dc.subjectCAPITAL ADEQUACY
dc.subjectCAPITAL ASSETS
dc.subjectCAPITAL RATIO
dc.subjectCAPITAL RATIOS
dc.subjectCAPITAL REQUIREMENTS
dc.subjectCAPITALIZATION
dc.subjectCASH FLOW
dc.subjectCDS
dc.subjectCOLLATERAL
dc.subjectCOMMERCIAL BANK
dc.subjectCOMMERCIAL BANKS
dc.subjectCONSUMER PRICE INFLATION
dc.subjectCONTINGENT CLAIM
dc.subjectCORPORATE BANKRUPTCY
dc.subjectCORPORATE DEBT
dc.subjectCORPORATE FINANCE
dc.subjectCORPORATE GOVERNANCE
dc.subjectCORPORATE GOVERNANCE REFORMS
dc.subjectCORPORATE GOVERNANCE REGIMES
dc.subjectCOUNTRY COVERAGE
dc.subjectCOUNTRY DATA
dc.subjectCOUNTRY FIXED EFFECTS
dc.subjectCREDIBILITY
dc.subjectCREDIT EXPANSION
dc.subjectCREDIT RISK
dc.subjectCREDITORS
dc.subjectCREDITWORTHINESS
dc.subjectDEBT
dc.subjectDEFAULT PROBABILITIES
dc.subjectDEFAULT RISK
dc.subjectDEFICITS
dc.subjectDEGREE OF RISK
dc.subjectDEPENDENT
dc.subjectDEPOSIT
dc.subjectDEPOSIT FUNDING
dc.subjectDEPOSIT INSURANCE
dc.subjectDEPOSITS
dc.subjectDEREGULATION
dc.subjectDISTRESSED BANKS
dc.subjectDIVIDEND
dc.subjectDIVIDEND RATE
dc.subjectDIVIDENDS
dc.subjectDUMMY VARIABLE
dc.subjectDUMMY VARIABLES
dc.subjectECONOMIC GROWTH
dc.subjectEQUITY HOLDER
dc.subjectEQUITY PRICES
dc.subjectEQUITY RATIO
dc.subjectEQUITY RETURNS
dc.subjectEQUITY VALUE
dc.subjectFACE VALUE
dc.subjectFAIR VALUE
dc.subjectFEDERAL RESERVE
dc.subjectFEDERAL RESERVE BANK
dc.subjectFEDERAL RESERVE BANK OF NEW YORK
dc.subjectFEE INCOME
dc.subjectFINANCIAL CRISIS
dc.subjectFINANCIAL INSTABILITY
dc.subjectFINANCIAL INSTITUTIONS
dc.subjectFINANCIAL INTERMEDIATION
dc.subjectFINANCIAL MARKET
dc.subjectFINANCIAL SAFETY NET
dc.subjectFINANCIAL SAFETY NETS
dc.subjectFINANCIAL SERVICES
dc.subjectFINANCIAL STUDIES
dc.subjectFINANCIAL SUPPORT
dc.subjectFINANCIAL SYSTEM
dc.subjectFISCAL BALANCE
dc.subjectFIXED ASSETS
dc.subjectFOREIGN FIRMS
dc.subjectGOVERNANCE INDEX
dc.subjectGOVERNANCE INDICES
dc.subjectGOVERNANCE PRACTICES
dc.subjectGOVERNANCE VARIABLES
dc.subjectGOVERNMENT BUDGET
dc.subjectGOVERNMENT SECURITIES
dc.subjectGROWTH RATE
dc.subjectHOLDINGS
dc.subjectHOLDINGS OF GOVERNMENT SECURITIES
dc.subjectINDIVIDUAL BANKS
dc.subjectINFLATION
dc.subjectINFLATION RATE
dc.subjectINSOLVENCY RISK
dc.subjectINSOLVENT
dc.subjectINSTRUMENT
dc.subjectINSURANCE
dc.subjectINSURANCE PREMIUM
dc.subjectINTANGIBLE
dc.subjectINTEREST INCOME
dc.subjectINTEREST RATES
dc.subjectINTERNATIONAL BANK
dc.subjectINTERPOLATION
dc.subjectINVESTING
dc.subjectINVESTOR PROTECTION
dc.subjectLARGE BANKS
dc.subjectLIABILITY
dc.subjectLIABILITY SIDE
dc.subjectLOAN LOSS
dc.subjectLOAN LOSS PROVISIONING
dc.subjectLOAN PERFORMANCE
dc.subjectLOAN QUALITY
dc.subjectMARKET DATA
dc.subjectMARKET DISCIPLINE
dc.subjectMARKET EQUITY
dc.subjectMARKET VALUE
dc.subjectMARKET VALUE OF EQUITY
dc.subjectMERGERS
dc.subjectMINORITY SHAREHOLDERS
dc.subjectMORAL HAZARD
dc.subjectMORTGAGE
dc.subjectMORTGAGE-BACKED SECURITIES
dc.subjectNATIONAL BANKS
dc.subjectNATIONAL ECONOMY
dc.subjectNON-PERFORMING LOANS
dc.subjectNONPERFORMING LOANS
dc.subjectNPL
dc.subjectOPERATING INCOME
dc.subjectOVERSIGHT OF BANK
dc.subjectPERFORMANCE RISK
dc.subjectPOLICY IMPLICATIONS
dc.subjectPROBABILITY OF BANKRUPTCY
dc.subjectPUBLIC COMPANIES
dc.subjectPUBLIC DEFICITS
dc.subjectPUBLIC FINANCES
dc.subjectPUBLIC POLICY
dc.subjectPUT OPTION
dc.subjectRAPID ECONOMIC EXPANSION
dc.subjectRATE OF RETURN
dc.subjectREAL ESTATE
dc.subjectREGULATORS
dc.subjectREGULATORY OVERSIGHT
dc.subjectREGULATORY RESTRICTIONS
dc.subjectREPUTATION
dc.subjectRESTRICTIONS ON BANK ACTIVITIES
dc.subjectRETURN ON ASSETS
dc.subjectRETURN ON EQUITY
dc.subjectRISK CONTROLS
dc.subjectRISK MANAGEMENT
dc.subjectRISK TAKING
dc.subjectRISK WEIGHT
dc.subjectRISK WEIGHTED ASSETS
dc.subjectRISK WEIGHTS
dc.subjectRISK-FREE RATE
dc.subjectRISKY ASSETS
dc.subjectSECURITIES MARKETS
dc.subjectSHARE PRICE
dc.subjectSHAREHOLDER
dc.subjectSHAREHOLDERS
dc.subjectSHORT-TERM BORROWING
dc.subjectSTOCK OPTION
dc.subjectSTOCK OPTIONS
dc.subjectSTOCK PRICE
dc.subjectSTOCK RETURNS
dc.subjectSUPERVISORY AGENCY
dc.subjectSUPERVISORY AUTHORITIES
dc.subjectTANGIBLE ASSETS
dc.subjectTAX
dc.subjectTRADING
dc.subjectTRADING INCOME
dc.subjectTRANSACTION
dc.subjectTREASURY
dc.subjectTREASURY BILL
dc.subjectTREASURY BILL RATE
dc.subjectVALUATION
dc.subjectVALUE OF ASSETS
dc.subjectVALUE OF DEBT
dc.subjectVOLATILITY
dc.subjectWORLD DEVELOPMENT INDICATORS
dc.titleCorporate Governance and Bank Insolvency Risk : International Evidenceen
dspace.entity.typePublication
okr.date.disclosure2014-09-01
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2014/09/20163225/corporate-governance-bank-insolvency-risk-international-evidence
okr.globalpracticeFinance and Markets
okr.globalpracticeGovernance
okr.globalpracticeTrade and Competitiveness
okr.guid990311468149673385
okr.identifier.doi10.1596/1813-9450-7017
okr.identifier.externaldocumentum000158349_20140902113102
okr.identifier.internaldocumentum20163225
okr.identifier.reportWPS7017
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2014/09/02/000158349_20140902113102/Rendered/PDF/WPS7017.pdfen
okr.topicBanks and Banking Reform
okr.topicGovernance::Governance Indicators
okr.topicPrivate Sector Development::Emerging Markets
okr.topicFinance and Financial Sector Development::Debt Markets
okr.topicFinance and Financial Sector Development::Bankruptcy and Resolution of Financial Distress
okr.unitDevelopment Research Group
okr.volume1 of 1
relation.isAuthorOfPublication234a20c0-893c-561a-8c90-6f5be5be5b9b
relation.isAuthorOfPublication.latestForDiscovery234a20c0-893c-561a-8c90-6f5be5be5b9b
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
Files
Original bundle
Now showing 1 - 2 of 2
Thumbnail Image
Name:
WPS7017.pdf
Size:
1.73 MB
Format:
Adobe Portable Document Format
Download
No Thumbnail Available
Name:
WPS7017.txt
Size:
139.87 KB
Format:
Plain Text
Download
License bundle
Now showing 1 - 1 of 1
No Thumbnail Available
Name:
license.txt
Size:
1.71 KB
Format:
Plain Text
Description:
Download
Collections
Policy Research Working Papers