This study examines the heterogeneity of foreign banks in the income diversification and performance nexus. We utilize annual bank data across 46 countries in Sub-Saharan Africa over the period 2011-2018 and find that increased income diversification improves banks performance, and the Global...

In this study, we reassess the links between commercial bank ownership and lending growth during the 1996-2019 period. We find evidence that the lending activities of foreign state-controlled and foreign privately owned banks differ, particularly during different crisis type periods and origins....

The global imbalance explanation of the financial crisis of 2007-09 suggests that demand for riskless assets from countries with current account surpluses created fragility in countries with current account deficits, most notably, in the United States. We examine this explanation by analyzing...

This paper examines the financial structure and the bank relationships of Italian multinational firms. We show that multinationals are on average more leveraged than non-internationalized firms. Moreover, they have a larger share of financial and bank debt out of total debt, maintain more bank...

This study investigates the impact of foreign ownership on bank risk in Vietnam between 2006 and 2015. Our findings show that foreign ownership can lower bank risk, suggesting that the State Bank of Vietnam should further remove restrictions on foreign investments in the banking system. The...

We examine the spillover and direct effects of cross-border bank M&As on the systemic risk of banks in the target’s country. We document that higher cross-border bank M&A activity is associated with higher systemic risk for peer banks, while target banks exhibit a decrease in systemic risk...

We study the scope for international cooperation in macroprudential policies. Multinational banks contribute to and are affected by fire sales in countries they operate in. National governments setting quantity regulations non-cooperatively fail to achieve the globally efficient outcome,...

This study investigates the impact of foreign ownership on bank risk in Vietnam between 2006 and 2015. Our findings show that foreign ownership can lower bank risk, suggesting that the State Bank of Vietnam should further remove restrictions on foreign investments in the banking system. The...

This study examines whether the agency problem regarding credit risk is a useful corporate governance mechanism for controlling credit risk. For this purpose, we estimate the impact of internal control and agency problems on credit risk in commercial banks in Vietnam from 2009 to 2018. First, in...

Beyond financial stability as the European Banking Union's primary objective, the European capital market integration provides an impetus for deepening bank integration and greater financial market efficiency. This article proposes an empirical framework to assess the dynamics of euro area...

Basel III regulation intent is to increase the resiliency of banks through effective risk management practices that can reduce significant idiosyncratic operational losses. A systemic risk event that leads to significant losses in a bank holding company (BHC) can expose them to become insolvent...

The stability of a banking system ultimately depends on the strength and credibility of the fiscal backstop. While large countries can still afford to resolve large global banks on their own, small and medium-sized countries face a policy choice. This paper investigates the impact of resolution...

This paper tests whether contagion can occur at the industry level, in particular the banking industry. In this paper ‘contagion’ is defined as significant spillovers of country-specific idiosyncratic shocks during the crisis after economic fundamentals or systematic risks have been...

This paper examines spillover effects of global monetary shocks on lending by foreign banks in an emerging country, South Korea. Foreign banks play a significant role by providing additional domestic credit and foreign currency liquidity and directing international capital flows via the banking...

This study documents a significant and positive impact of country-level sustainability scores on cross-border bank-to-nonbank flows. This result is robust after mitigating endogeneity concerns by applying instrumental variable regression, generalized method of moments estimation, Fama-MacBeth...

This study investigated the direct link between foreign bank entry and economic growth in Sub-Sahara African countries using a dynamic generalized method of moment estimator. It also studied a comparative analysis on banking environment for SSA countries that open and restrict banking industries...

Using a sample of 27 countries between 1990 and 2014, we find that banks charge higher interest rates and adjust other contractual features of their loans when lending to firms facing more stringent environmental regulations. Our evidence suggests that lenders' concerns about the increase in...

Using a novel cross-European dataset on bank internationalization, the paper accounts for both organizational and geographic complexity and evaluates its impact on systemic risk and how both the 2008–09 global financial crisis and the 2010–11 European sovereign debt crisis might have...

When firms borrow in foreign currency but collect revenues in local currency, exchange rate changes can affect their ability to repay their debt. Using loan-level data from U.S. banks' regulatory filings, this paper studies the effect of exchange rate changes on firms' loan payments. A 10...

Unlike purely domestic firms, globalized firms have unique opportunities to engage in international tax planning activities. This study examines whether banks consider international tax planning, and in particular potential earnings repatriation taxes, when setting loan contracts for...

Can policies directed at the banking sector in one jurisdiction spill over and affect real economic activity elsewhere? To investigate this question, I exploit changes in tax rates on bank profits across U.S. states. Banks respond by reallocating small-business lending to otherwise unaffected...

This paper documents a positive relation between internationalization and bank risk. This is consistent with the empirical dominance of the market risk hypothesis – whereby internationalization increases banks' risk due to market-specific factors in foreign markets – over the diversification...

We use lasso methods to shrink, select and estimate the network linking the publicly-traded subset of the world's top 150 banks, 2003-2014. We characterize static network connectedness using full-sample estimation and dynamic network connectedness using rolling-window estimation. Statistically,...

This paper introduces a new transmission channel of banking crises where sizable cross-border bank claims on foreign countries with high domestic crisis risk enable contagion to the home economy. This asset-side channel opposes traditional views that see banking crises originating from either...

This paper introduces a new transmission channel of banking crises where sizable cross- border bank claims on foreign countries with high domestic crisis risk enable contagion to the home economy. This asset-side channel opposes traditional views that see bank- ing crises originating from either...

The aim of the study is to measure the impact of intellectual capital on the profitability ratios in respect of the foreign banks in India. Twenty seven foreign banks were studied and analyzed by using Modified Value Added Intellectual Coefficient (MVAIC) method and Structural Equation Method...

We characterize how U.S. global systemically important banks (GSIBs) supply short-term dollar liquidity in repo and foreign exchange swap markets in the post-Global Financial Crisis regulatory environment and serve as the "lenders-of-second-to-last-resort". Using daily supervisory bank balance...

This paper investigates how multinational banks use internal debt to shift profits to low-taxed affiliates. Using regulatory data on multinational banks headquartered in Germany, we show that banks use this tax avoidance channel more aggressively than non-financial multinationals do. We find...

Banking systems operate as the beating heart in each country's economy. Subsequently the flaws and shortcomings existing in this system have a direct impact on the major sections of economy. In fact, the designers of the new banking system in Iran have started simulating the system of interest...

This paper investigates how multinational banks use internal debt to shift profits to low-taxed affiliates. Using regulatory data on multinational banks headquartered in Germany, we show that banks use this tax avoidance channel more aggressively than non-financial multinationals do. We find...

We analyse the role of financial development as a buffer to diminish the effect of a cross-border bank flows shock on house prices. From panel vector auto-regressions, we compute impulse-response functions for 38 countries ranked and grouped by financial development. In less financially...

Discussions about the banking union have restarted. Its success so far is limited: national banking sectors are still overwhelmingly exposed to their own countries’ economies, cross border banking has not increased and capital and liquidity remain locked within national boundaries. The policy...

US net capital inows drive the international synchronization of house price growth. An increase (decrease) in US net capital inows improves (tightens) US dollar funding conditions for non-US global banks, leading them to increase (decrease) foreign lending to third-party borrowing countries....

US net capital inflows drive the international synchronization of house price growth. An increase (decrease) in US net capital inflows improves (tightens) US dollar funding conditions for non-US global banks, leading them to increase (decrease) foreign lending to third-party borrowing countries....