Officials on boards and the prudential behavior of banks: Evidence from China's city commercial banks

Governance, efficiency and risk taking in Chinese banking

“…A key finding of this study is that the proportion of female directors on the board appears not only to be linked to higher profit and cost efficiency but also to lower traditional banking risk. These results are consistent with the abundant literature that shows that greater gender diversity on boards has a positive impact on M A N U S C R I P T A C C E P T E D ACCEPTED MANUSCRIPT bank performance (Gul et al, 2011;Minton et al, 2011) and reduces risk taking behaviour (Qian et al, 2015). Likewise, our findings show that a higher level of board independence can also be associated with banks' higher profit efficiency, while the opposite is found for executive directors and in the presence of dual leadership of the CEO/chairperson.…”

“…These results corroborate the abundant literature on the finding that gender diversity of the board has a positive impact on bank performance (e.g. Gul et al, 2011, Minton et al, 2011 and can reduce risk taking (Qian, Zhang, & Liu , 2015).…”

City Commercial Banks and Credit Allocation: Firm-Level Evidence

“…In contrast, private infrastructure firms benefit from the creation of CCBs, even with their inferior credit quality. In the following subsections, we acknowledge that municipal governments as founders and main shareholders of CCBs often appoint CCB directors (Qian et al, 2015), which gives local officials an opportunity to exploit CCB credit allocation to advance their personal career prospects.…”

“…ments of CCB senior managers (Qian et al, 2015;Hung et al, 2017). They could exploit the possibility of channeling credit to projects aligned with their political agendas, especially projects that increased their likelihood of career advancement.…”

Chondrogiannis, I; Nivorozhkin, E; (2020) Systemic Risk in the Chinese Banking Sector

“…Using a sample of Chinese commercial banks between 2006 and 2010, Qian et al (2015) suggest that government ownership has no effect on prudential bank behavior, while having government officials appointed as board directors has a negative effect. In addition, high bank capital requirements are likely to increase risk-taking after a certain level (Jiang et al has been growing rapidly after 2015, in a manner similar to SRISK.…”