Bank capital structure, capital requirements and SRISK across bank ownership types and financial crisis: panel VAR approach

Jouida, Sameh

doi:10.1007/s11156-018-0750-5

Cited by 12 publications

(10 citation statements)

References 45 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Further, a vast majority of the studies reviewed used the equity to assets ratio as a measure of capitalization and ignored the relationship between the profitability of banks and their regulatory capital ratios, i.e., their capital to risk-weighted assets ratio and minimum capital requirements. Some studies, however, did use the capital to risk-weighted assets ratio as a measure of capitalization but in a different context (see for example Belaid et al 2017;Konara et al 2019;Jouida 2018). This study is the first to employ the equity to assets ratio, capital to risk-weighted assets ratio, and minimum capital requirements as measures of capitalization to provide better insight and offer more profound implications.…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

“…This study employs three measure of capitalization: the Capital Ratio (CR), as a measure of total equity to total assets (Haris et al 2019c;Athanasoglou et al 2008;Saona 2016;Tan 2016;; the Capital Adequacy Ratio (CAR), as a measure of regulatory capital to total risk-weighted assets (Belaid et al 2017;Jouida 2018;Konara et al 2019;; and the Minimum Capital Requirement (MCR). The CR has been extensively studied in the vast body of literature, while the CAR and MCR are regulatory concerns 3 based on the BASEL guidelines developed to measure and strengthen the capital position of banks and other financial institutions.…”

Section: Independent Variablesmentioning

confidence: 99%

See 1 more Smart Citation

A Study on the Impact of Capitalization on the Profitability of Banks in Emerging Markets: A Case of Pakistan

Haris

Tan

Malik³

et al. 2020

JRFM

View full text Add to dashboard Cite

A strong capitalized position of financial institutions is essential to ensure their solvency. Because of their unique nature, banks must always keep an optimum level of capital to ensure smooth banking earnings. Consequently, it is mandatory for all types of banks operating in Pakistan to keep a minimum amount of required capital along with capital adequacy to remain solvent and profitable. Therefore, using three measures of capitalization, i.e., the Capital Ratio (CR), Capital Adequacy Ratio (CAR), and Minimum Capital Requirement (MCR), and four measures of profitability, i.e., Return on Avg. Assets (ROAA), Return on Avg. Equity (ROAE), Net Interest Margin (NIMAR), and Profit Margin (NMAR), this study contributes to the existing literature on the relationship between the capitalization and profitability of 29 Pakistani banks over the period of 2007–2018. The results, based on the Generalized Method of Moments (GMM) system estimator technique, reported an inverted U-shaped relationship between the two capitalization measures, i.e., CR and CAR, and the four profitability measures, i.e., ROAA, ROAE, NIMAR, and NMAR. This indicates that profitability increases with an increase in capitalization up to a certain level, while beyond that level, a further increase in capitalization decreases profitability. The results also indicate that banks who maintain their MCR have higher profitability than those who do not.

show abstract

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Section: Independent Variablesmentioning

confidence: 99%

A Study on the Impact of Capitalization on the Profitability of Banks in Emerging Markets: A Case of Pakistan

Haris

Tan

Malik³

et al. 2020

JRFM

View full text Add to dashboard Cite

show abstract

“…In our paper, we investigate the impact of AC characteristics on the quality and quantity of forward-looking disclosure (FLD) in the chairman statement. The corporate board of directors (BODs) and its committees, such as AC, are relevant CG mechanisms that oversee managerial actions (Fama and Jensen 1983;Blue Ribbon Report 1999;Smith Report 2003;Lu and Boateng 2018;Jouida 2019). AC members have great control over the information to be disclosed in annual reports to protect shareholders' interests (Li et al 2008;Haji 2015;Abad and Bravo 2018).…”

Section: Introductionmentioning

confidence: 99%

Disclosure quality vis-à-vis disclosure quantity: Does audit committee matter in Omani financial institutions?

Lawati

Hussainey

Sagitova

2021

Rev Quant Finan Acc

View full text Add to dashboard Cite

We examine the impact of audit committee (AC) characteristics (e.g. AC foreign members, AC female members, AC members with multiple directorships, AC members with share ownership and AC with financial and supervisory expertise) on forward-looking disclosure (FLD) quality and quantity. Using a sample of Omani financial companies listed on Muscat Securities Market over a five-year period (2014–2018), we find that a number of AC characteristics (such as AC size, AC female members and AC with multiple directorships) improve FLD quality. We make no such observation for FLD quantity. The results suggest that the responsibility of AC extends to improving the quality of FLD. We provide an additional analysis on the impact of AC effectiveness (ACE) on FLD quality, which suggests that companies’ compliance with CG code is beneficial for disclosure quality. We also find that the impact of ACE on FLD quality is influenced by corporate performance, leverage and the quality of external auditors. Our findings carry implications for the regulatory bodies’ efforts in encouraging companies to improve disclosure quality by considering AC characteristics as well as appointing more effective AC directors.

show abstract

“…A weak system of governance tends to offer substantial managerial opportunities to engage in risk-taking activities and fraudulent acts. Extant literature (e.g., Mallette and Fowler 1992;Faleye et al 2018;Lu and Boateng 2017;Jouida 2019) documents that an effective board of directors can monitor top 1 3 management on behalf of shareholders to reduce information asymmetry between managers and shareholders and thereby lessen agency costs. Resource dependence theorists assert that a board of directors is "a provider of resources, such as legitimacy, advice and council links to other organizations" (Hillman and Dalziel 2003, p. 383).…”

Section: Introductionmentioning

confidence: 99%

Differential market valuations of board busyness across alternative banking models

Elnahass

Omoteso

Salama

et al. 2019

Rev Quant Finan Acc

View full text Add to dashboard Cite

This study comparatively assesses the influence of board busyness (i.e., multiple directorships of outside directors) on stock market valuations of both Islamic and conventional banks. For a sample of listed banks from 11 countries for the period 2010-2015, results show that board busyness is differentially priced by investors depending on the bank type. In conventional banks, board busyness is significantly and positively valued by the stock market. This result suggests that investors perceive some reputational benefits arising from a busy board (e.g., extended industry knowledge, established external networks or facilitation of external market sources). In contrast, we find no supporting evidence on the market valuations of board busyness in Islamic banks. This result might be attributed to, both, the complex governance structure and the uniqueness of the business model which require additional effective monitoring, relative to that employed in conventional banking. Our results also show that investors provide significantly low market valuations for busy Shari'ah advisory board which acts as an additional layer of governance in Islamic banks. Findings in this study offer important policy implications to international banking studies and regulations governing countries with dual-banking systems.

show abstract

Bank capital structure, capital requirements and SRISK across bank ownership types and financial crisis: panel VAR approach

Cited by 12 publications

References 45 publications

A Study on the Impact of Capitalization on the Profitability of Banks in Emerging Markets: A Case of Pakistan

A Study on the Impact of Capitalization on the Profitability of Banks in Emerging Markets: A Case of Pakistan

Disclosure quality vis-à-vis disclosure quantity: Does audit committee matter in Omani financial institutions?

Differential market valuations of board busyness across alternative banking models

Contact Info

Product

Resources

About