COVID-19 pandemic impact on banking sector: A cross-country analysis

Shabir, Mohsin; Jiang, Ping; Wang, Wenhao; Işık, Özcan

doi:10.1016/j.mulfin.2023.100784

Cited by 31 publications

(18 citation statements)

References 87 publications

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“…Scientists link indicators that represent public sector performance with success and stability of the banking system. For example, using covid-19 pandemic time as case study Shabir, Jiang, & Işık, (2023) indicate on significance of regulatory environment and institutional quality for the soundness of banks. Mérő and Piroska (2016) write that the role of state is significant in maintaining stable banking sector in the countries of the CEE region.…”

Section: Discussionmentioning

confidence: 99%

“…Additionally, scientists pay attention on the crisis of non-financial nature, i.e., covid-19 pandemic. In this context, Shabir et al (2023) conclude that institutional quality and financial development are crucial for the soundness of the banking sector. In other studies, scientists focus on financial technologies and mostly find positive effects on the banking sector, for example, in activities devoted to risk control and reduction of costs (e.g., Wang et al, 2021).…”

Section: Literaturementioning

confidence: 98%

“…Although, studies mostly focus on concrete or several factors and rarely pay attention on the complex approach, where every areas are included and compared simultaneously. Overall, scientists conclude that quality of institutions is significant for the sound banking system (e.g., Hou & Wang, 2016;Bermpei, 2018;Menshikov et al, 2019;Ahmed et al, 2021;Shabir et al 2023). However, scientists continue to evaluate, which institutional factors are more relevant for the soundness of banks.…”

Section: Literaturementioning

confidence: 99%

“…For example, economic freedom, political stability, entrepreneurial environment and culture, societal well-being, technological expansion, supervisory regulation, institutional reforms, corporate governance, and even climate change (e.g., Chan et al, 2015;Berglund & Makinen, 2019;Jin et al, 2017;Fang et al, 2014;Lamperti et al, 2021). Scientists also indicate that quality of institutions is significant for the sound financial sector and banks (Hou & Wang, 2016;Bermpei et al, 2018;Ahmed et al, 2021;Shabir et al 2023). In addition to the results of the previous studies, the authors see the reason for the research question in empirical fact that relationship between quality of institutions and overall stability of the financial system exists and that it is stronger for the case with higher level of the soundness of banks (see Figure 1).…”

Section: Introductionmentioning

confidence: 99%

“…This is result from variety of factors directly and indirectly affecting the soundness of banks in every case depending on characteristics of institutional quality. For example, scientists take into account institutional quality and reforms (e.g., Fang et al, 2014;Mérő & Piroska, 2016;Bermpei et al, 2018;Mikheeva & Juuse 2021;Shabir et al 2023), as well as institutional framework (e.g., Chan et al, 2015), when studying the soundness of banks. Special attention in scientific studies is devoted to transition countries (e.g., Setiawan et al 2021;Fang et al, 2014) as, for example, the CEE region is.…”

Section: Introductionmentioning

confidence: 99%

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Linking Institutional Factors with the Financial Soundness of Banks. Evidence from the CEE Region

2023

EJSD

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Sustainable financial sector needs the sound banking system. The soundness of the banking system is the subject for effects from institutional factors representing the areas of economy, society, public sector, legislation, technologies, and climate change. Although, studies rarely pay attention to the complex approach, where all areas are analysed simultaneously within the study. Design of the present study aims to analyse institutional factors of interdisciplinary nature, which demonstrate potential significance for the sound banking system. The authors focus on the cases that differ by the level of the soundness of banks. The approach provides the novelty of research. Method. During the research, the authors identify and characterise linkages between the factors of institutional environment and the soundness of banks. For the aim, monographic method and correlation analysis are applied. Analysis. The analysis is organised by using two cases that differ by the level of the soundness of banks -the region of Central and Eastern Europe and ten countries with the highest level of the soundness of banks in the world according to the data on Global Competitiveness Report. Results. For the cases that differ by the level of the soundness of banks, the research results demonstrate similarity by the linkages with indicators representing depth of financial system and corporate governance. Differences between the cases appear by the linkages with indicators representing public sector performance and stability of financial system. Conclusions. For the case with lower level of the soundness of banks, overall trends that are necessary for functioning of the sound banking system are observed. Although, several indicators that by their sense are significant for the sound banking system demonstrate negative direction or weak relationship with the soundness of banks what has to be improved in the future and appear as a result of the peculiarities of the banking sector in the region.

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Section: Discussionmentioning

confidence: 99%

Section: Literaturementioning

confidence: 98%

Section: Literaturementioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Linking Institutional Factors with the Financial Soundness of Banks. Evidence from the CEE Region

2023

EJSD

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Does ESG performance impact value and risk‐taking by commercial banks? Evidence from emerging market economies

Gangwani,

Kashiramka

2024

Bus Strat Env

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The study examines the impact of environmental, social, and governance (ESG) performance on the value and risk‐taking behavior of listed commercial banks in emerging market economies (EMEs). The study analyzes a comprehensive sample of 178 commercial banks listed in the top 20 emerging markets from 2015 to 2021. The study employs the System generalized method of moments (GMM) with Arellano‐Bond estimation to address the endogeneity issue. The results indicate that banks with higher ESG disclosure scores are linked to reduced risks for commercial banks such as insolvency, leverage, and liquidity risks, in line with shareholder theory. Furthermore, the results demonstrate that sample banks with higher ESG disclosure scores show better accounting (ROE and ROA) and market (Tobin's Q) performance, supporting both agency theory and resource‐based theory. The robustness tests validate the consistency of the results.

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COVID‐19 and credit risk variation across banks: International insights

Acheampong,

Ibeji,

Danso

2024

Manage Decis Econ

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This paper focuses on utilizing non‐performing loans (NPLs) as the primary indicator of credit risk to analyze how various bank and country‐level characteristics influence changes in credit risk within and between banks across China, Europe, and the U.S. during the COVID‐19 period. Over 4,959 bank‐quarter observations (from Q4 2019 to Q4 2021), it becomes evident that COVID‐19 significantly contributes to the variation in NPLs, underscoring its adverse impact on credit risk. This pattern is consistent across all countries; however, Chinese banks exhibit more robust capabilities in managing credit risk exposure compared to their European and U.S. counterparts. These findings offer significant implications for policymakers, investors, and regulators who are concerned about the repercussions of global pandemics on financial institutions.

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COVID-19 pandemic impact on banking sector: A cross-country analysis

Cited by 31 publications

References 87 publications

Linking Institutional Factors with the Financial Soundness of Banks. Evidence from the CEE Region

Linking Institutional Factors with the Financial Soundness of Banks. Evidence from the CEE Region

Does ESG performance impact value and risk‐taking by commercial banks? Evidence from emerging market economies

COVID‐19 and credit risk variation across banks: International insights

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