This study investigates the nonlinear interplay between bank stability, financial inclusion, deposit insurance design, and banking concentration, utilizing unbalanced panel data from 122 countries between 2004 and 2021. By constructing novel indices-including a composite Moralhazard index to...

Banks can grant loans to firms bilaterally or in syndicates. We study this choice by combining bilateral loan data with syndicated loan data. We show that loan size alone does not adequately explain syndication. Instead, banks' ability to manage risks and firm riskiness drive the choice to...

This paper examines the validity of the risk-return trade-off for a sample of Czech banks over the period 2002-2022 by analysing the relationship between the bank risk and risk-adjusted returns. I find evidence of a significant negative association between the regulatory risk measure and...

Using a panel data approach with bank-fixed effects, we study the impact of Targeted Longer-Term Refinancing Operations (TLTRO) on banks’ risk, given by their distance to default (DtD). The study aims to determine if the liquidity from TLTROs influences banks’ risk-taking behaviour. For the...

This study aimed to establish the nexus between CEO power and bank risk. Previous studies on how CEO power affects risk-taking have produced mixed results. Some studies show that CEO power reduces risk, while others show the reverse. This lack of conclusive findings motivated this study. This...

We argue that the rapid asset growth of nonbank financial intermediaries (NBFIs) relative to banks is the outcome of transformations of risks between banks and NBFIs that increase the interconnectedness of the two sectors. These transformations are consistent with avoiding tighter, post-GFC bank...

This paper examines the relevance of banks' exposure to climate transition risk in the interbank lending market. Using transaction-level data on repo agreements, we first establish that banks with higher exposure to transition risk face significantly higher borrowing costs. This premium is a...

The financial crisis of 2007-2008 highlighted the risks that liquidity spirals pose to financial stability. We introduce a novel method for studying liquidity spirals and use this method to identify spirals before stock prices plummet and funding markets lock up. We show that liquidity spirals...

This study examines the systemic operational risk in Morocco's banking sector using a Panel VAR model based on data from three banks over ten years. The model includes real GDP, interbank rate (TMP), and bank credit, alongside indicators of operational, credit, and liquidity risks. The Impulse...

This paper examines the impact of financial market development, financial crises and deposit insurance on bank risk based on macro data of 86 countries during the period 1998-2014. The results show that banking sector development and stock market development have opposing effects on bank risk...

There is a need to explore the moderating role of banks' efficiency in the relationship between corporate governance (CG) and default probability in Pakistan. Such attention is required due to poor bank governance, which threatens banks' stability. This empirical study's objective is to...

Purpose: This paper analysed the effects of bank's risk on capital buffer in Namibia, in the absence of the consensus on the cyclical behavior of capital buffers. Design/methodology/approach: The study employed the autoregressive distributed lag (ARDL) modelling technique on quarterly data for...

This paper examines the impact of climate-related financial policies (CFPs) on bank risks, utilizing a comprehensive global dataset spanning from 2000 to 2021. It explores whether CFPs influence bank risk levels across different regions and regulatory environments.Using a dataset comprising...

Conventional risk assessment frameworks usually define risk as a function of vulnerabilities and threats, but they frequently lack a single quantitative model that incorporates the unique features of each element. In order to close this gap, this paper creates a flexible, open, and theoretically...

In this paper, we analyse data from 493 listed banks across 28 countries to investigate the impact and mechanisms through which banks' derivatives holdings influence systemic risk. Our empirical results indicate that banks' derivatives holdings significantly increase systemic risk. Regarding the...