Impact of Capital Regulation and Market Discipline on Capital Ratio Selection: A Cross Country Study

Hunjra, Ahmed Imran; Zureigat, Qasim; Mehmood, Rashid

doi:10.3390/ijfs8020021

Cited by 13 publications

(12 citation statements)

References 44 publications

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“…Emerging countries and firms operating in these countries face the problem of an effective governance system and they try to resolve this issue in order to attract investors and compete in the market (Boubaker and Nguyen 2014). In addition, capital market growth is very low in developing countries as compared to developed countries (Hunjra et al 2020a). Further, corporate governance policies are not effectively implemented in emerging countries which results in decreasing stock market liquidity (Hunjra et al 2020c).…”

Section: Introductionmentioning

confidence: 99%

The Role of Ownership Structure and Board Characteristics in Stock Market Liquidity

Abbassi

Hunjra

Alawi

et al. 2021

IJFS

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Corporate governance plays a significant role in the value of shareholders and share prices, hence stock market liquidity is affected. Previous research has mainly focused on the issue in developed markets, whereas in developing countries there is a need to analyze the influence of corporate governance on stock market liquidity. Therefore, the present study aims to examine the impact of ownership structure and board characteristics on stock market liquidity of non-financial firms of South Asian countries such as Pakistan, Sri Lanka, Bangladesh, and India. The data in the study is collected from the DataStream for the 2011–2020 period. The study uses a fixed effect model for the analysis of the data and hypotheses testing and generalized method of moments (GMM) is used to check the robustness of the results. The findings of the study indicate that institutional ownership, board size, board independence, and CEO duality have a significant and positive impact on stock market liquidity, whereas managerial ownership has a significant and negative effect on stock market liquidity.

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Section: Introductionmentioning

confidence: 99%

The Role of Ownership Structure and Board Characteristics in Stock Market Liquidity

Abbassi

Hunjra

Alawi

et al. 2021

IJFS

Self Cite

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“…This study relates to South Asian countries due to their importance in emerging economy. Banking system of these countries is at the growing phase, with diverse strategies and stages of development (Hunjra et al, 2020c). During recent decades, emerging countries normally display financial markets with increasingly developing economies, while having political, social, and economic progress (Boubaker & Nguyen, 2014).…”

Section: Introductionmentioning

confidence: 99%

“…Furthermore, a two-step system dynamic panel regression is used to test hypotheses. The GMM technique explains the variation and bias concerning the endogeneity issues (Hunjra et al, 2020b). This study uses twostep dynamic panel estimation, which is appropriate for a short period and long cross-sectional data.…”

Section: Introductionmentioning

confidence: 99%

Impact of non-interest income and revenue concentration on bank risk in South Asia

Hunjra

Zureigat

Tayachi

et al. 2020

Banks and Bank Systems

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Banks not only rely on the traditional way of generating income, they also opt for non-interest income (NII) to survive in a competitive environment. Banks in South Asia are diversifying their income from interest to non-interest sources in order to reduce risk and generate high returns. This study examines the impact of non-interest income (NII) and revenue concentration on banks’ risk in South Asian countries such as Pakistan, Sri Lanka, India and Bangladesh. Panel data for eighty-five banks from 2009 to 2018 is used. Generalized Method of Moments (GMM) is employed to analyze the data. The study finds that non-interest source income and revenue concentration significantly affect bank risk in the overall analysis. The study finds different results depending on the regulations and application of the regulatory system in each country. Non-interest income reveals a significant impact on bank risk for Pakistan, India and Bangladesh, but insignificant for Si Lanka. Revenue concentration has a significant effect on bank risk in Pakistan and India, however, it does not affect bank risk in Sri Lanka and Bangladesh. This study recommends that bank managers focus on different sources of revenue generation in order to minimize their level of risk through a diversification strategy to enhance efficiency. This study contributes to the banking sector literature of South Asian markets.

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“…Nevertheless, it affects the efficient functioning of credit institutions, including their ability to hedge bank risk resulting from prudential norms. This issue was indicated by various representatives of the scientific community because the newly implemented regulations increase demand for bank capital while changing its quality and financing structure in banks, which significantly determines the capital effectiveness of global financial markets [23][24][25][26][27][28][29][30][31][32]. The main aim of this paper is an extrapolation of risks appearing in the unstable environment of credit institutions, which are increasingly boldly directing their expectations on their inclusion in the sustainable finance concept implementation.…”

Section: Introductionmentioning

confidence: 99%

Banks’ Capital Requirements in Terms of Implementation of the Concept of Sustainable Finance

Pyka

Nocoń

2021

Sustainability

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In 2015, the governments of 193 United Nations member states adopted the 2030 Agenda for Sustainable Development, followed by the Paris Agreement. Their detailed solutions assume the inclusion of the concept of sustainable finance into investment decision-making processes, including directing capital towards sustainable investments and stopping climate change. The main subject of the study is sustainable finance, which is one of the pillars of the sustainable development of the global economy, which has also become an important objective of the European Union, enshrined in the Treaty of Lisbon. The main aim of the paper is an extrapolation of risks appearing in the unstable environment of credit institutions, which are increasingly boldly directing their expectations on their inclusion in the sustainable finance concept implementation. The empirical research included in the first stage a questionnaire survey, while in the second one, a quantitative comparative analysis. The research was aimed at verifying the research hypothesis stating that after the global financial crisis, banks meet the new prudential capital regulations, however by their inclusion in the concept of green finance, they will increase a share of mitigation in the bank risk management strategy. The research, carried out in the Polish banking sector, has shown that domestic banks meet all prudential requirements resulting from the new capital norms. However, investment strategies, based on the composition of the portfolio in accordance with the principles of sustainable finance and on high rates of return in the long term, will change banks’ resilience to key risks from the perspective of sustainable development.

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Impact of Capital Regulation and Market Discipline on Capital Ratio Selection: A Cross Country Study

Cited by 13 publications

References 44 publications

The Role of Ownership Structure and Board Characteristics in Stock Market Liquidity

The Role of Ownership Structure and Board Characteristics in Stock Market Liquidity

Impact of non-interest income and revenue concentration on bank risk in South Asia

Banks’ Capital Requirements in Terms of Implementation of the Concept of Sustainable Finance

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