2017
DOI: 10.1016/j.najef.2017.07.007
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Abstract: This paper contributes to the empirical literature on banking profitability by testing the impacts of competition and shadow banking on bank profitability using a sample of 100 Chinese commercial banks over 2003-2013 with 417 and 395 observations. The current study fills the gaps in the empirical studies by examining the competition in different banking markets (i.e. deposit market, loan market and non-interest income market) in China and further evaluating their impacts on bank profitability. The findings sho… Show more

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Cited by 61 publications
(54 citation statements)
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References 76 publications
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“…Total income (Ghosh, 2015;Louzis, Vouldis, & Metaxas, 2012) Stability Total equity Total assets (Ghosh, 2015;Klein, 2013) Industry-specific determinants Shadow banking Growth in number of companies in shadow banking (Elliott, Kroeber, & Qiao, 2015;Tan, 2017) We extend the related literature in three aspects. First, in the context of India our study perhaps presents one of the most extensive emperical analysis related to the asset quality determinants of Indian banking sector.…”
Section: Log Of Total Assetsmentioning
confidence: 99%
“…Total income (Ghosh, 2015;Louzis, Vouldis, & Metaxas, 2012) Stability Total equity Total assets (Ghosh, 2015;Klein, 2013) Industry-specific determinants Shadow banking Growth in number of companies in shadow banking (Elliott, Kroeber, & Qiao, 2015;Tan, 2017) We extend the related literature in three aspects. First, in the context of India our study perhaps presents one of the most extensive emperical analysis related to the asset quality determinants of Indian banking sector.…”
Section: Log Of Total Assetsmentioning
confidence: 99%
“…Big banks are often worried about disbursing loans to micro, small and medium enterprises due to the information asymmetry that could arise from the financial reports. For that reason, a shadow bank innovated by providing loans to those who were not previously served (Tan, 2017;Wu & Hua, 2018). The FinTech-based P2P platform really helped micro, small and medium enterprises to gain access to loans (Song et al, 2018).…”
Section: P2p Has No Effect On Bank Loansmentioning
confidence: 99%
“…There are two conflicting arguments regarding the relationship between a firm's assets size, earnings growth rate, and WACC. First, larger banks could benefit from economies of scale and greater diversification, which reduces risk and cost, and increases banks' profitability [15,16] Dietrich and Wanzenried [17] argued that larger banks, as compared to smaller banks, are likely to have both economies of scale (increased operational efficiency) and economies of scope (higher degree of product and loan diversification) advantages [17]. Thus, the expectation of a positive effect of the bank's size on profitability leads to lowers the perceived risk of investors and WACC and increases the value of a firm.…”
Section: Total Assets Earnings Growth Rate and Waccmentioning
confidence: 99%
“…Second, it is argued that large banks could have more serious asymmetric information problems and that the increase in the cost of monitoring lending activities could reduce bank profitability [16]. Other scholars argued that extremely large banks would exhibit a negative relationship between size and profitability due to bureaucratic and other size-related reasons.…”
Section: Total Assets Earnings Growth Rate and Waccmentioning
confidence: 99%