Bank Capital and Risk in Europe and Central Asia Ten Years after the Crisis

Anginer, Deniz; Demirgüç-Kunt, Aslı; Mare, Davide Salvatore

doi:10.1596/1813-9450-9138

Cited by 5 publications

(2 citation statements)

References 16 publications

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“…However, as mentioned in the theoretical literature review, the definition of CG theoretically is ambiguous. On one hand, the establishment of an independent board of directors within companies may not always lead to an acceptable level of risk (Anginer et al, 2020) and may not align the interests of managers with shareholders' objectives. On the other hand, the characteristics of the institutional and regulatory environment in the country can negatively impact the effectiveness of the governance system and subsequently affect firm performance.…”

Section: Introductionmentioning

confidence: 99%

On the measurement of corporate governance and its impact on bank profitability and credit risk: The case of Tunisian listed banks

Jmaii,

Zaafouri,

Mehri

2024

African Development Review

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This paper explores the influence of corporate governance on the profitability and credit risk of a sample of listed banks in Tunisia. The methodology involves two main steps. Firstly, principal component analysis is employed to construct a novel governance index, assessing the quality of both internal and external bank governance. This index takes into account the degree of compliance and application of directives and laws mandated by the Tunisian Central Bank regarding banking governance. In the second step, panel data analysis is conducted to scrutinize the impact of internal and external governance mechanisms on the profitability and risk of Tunisian banks. The results reveal that as the governance index increases, the profitability of banks improves in terms of return on assets and stock market performance. Additionally, a higher governance index is correlated with a reduction in credit risks, as indicated by lower instances of non‐performing loans and an increased rate of coverage for classified debts. To enhance the robustness of our results, we calculate a standard governance score based on existing empirical literature. Furthermore, to account for potential endogeneity, we employ the two‐step system generalized method of moments.

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Section: Introductionmentioning

confidence: 99%

On the measurement of corporate governance and its impact on bank profitability and credit risk: The case of Tunisian listed banks

Jmaii,

Zaafouri,

Mehri

2024

African Development Review

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“…Source: Transformation Index of the Bertelsmann Stiftung (2020); Worldwide Bureaucracy Indicators (World Bank 2020b) and local sources where Worldwide Bureaucracy Indicators not available or outdated (Armenia, Azerbaijan, Belarus, the Kyrgyz Republic, Montenegro, North Macedonia, the Russian Federation, Tajikistan, and Turkey);and Anginer, Demirgüç-Kunt, and Mare (2020). Note: Subregional averages based on 29 countries in ECA.…”

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confidence: 99%

Europe and Central Asia Economic Update, Fall 2021: Competition and Firm Recovery post COVID-19

2021

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Some rights reserved 1 2 3 4 24 23 22 21 This work is a product of the staff of The orld Bank with external contributions. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of The orld Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries.Nothing herein shall constitute or be considered to be a limitation upon or waiver of the privileges and immunities of The orld Bank, all of which are specifically reserved.

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Competition and firm recovery post-COVID-19

Demirgüç-Kunt

Singer

2023

Small Bus Econ

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This paper examines the impact of the COVID-19 crisis on the reallocation of economic activity across firms and whether this reallocation depends on the competition environment. The paper uses the World Bank's Enterprise Surveys COVID-19 Follow-up Surveys for about 8000 firms, including both small and large firms, in 23 emerging and developing countries in Europe and Central Asia, matched with 2019 Enterprise Surveys data. It finds that during the COVID-19 crisis, smaller firms were hit harder, and economic activity was reallocated toward firms with higher pre-crisis labor productivity. Countries with a strong competition environment experienced more reallocation from less productive to more productive firms than countries with a weak competition environment. The evidence also suggests that reallocation from low-to high-productivity firms during the COVID-19 crisis was stronger compared with pre-crisis times. Finally, the analysis shows that government support measures implemented in response to the crisis may have adverse effects on competition and productivity growth since support went to less productive and larger firms, regardless of their pre-crisis innovation.Plain English Summary The COVID-19 crisis had a profound impact on firms. Firms which were more productive pre-crisis fared relatively better, particularly in countries with a more competitive business environment. Using survey data for about 8000 firms, including both small and large firms, in 23 emerging and developing countries in Europe and Central Asia, the paper finds that during the COVID-19 crisis, smaller firms were hit harder, and economic activity was reallocated toward firms with higher pre-crisis labor productivity. Countries with a strong competition environment experienced more reallocation from less productive to more productive firms than countries with a weak competition environment. The evidence also suggests that reallocation from low-to high-productivity firms during the COVID-19 crisis was stronger compared with pre-crisis times. Finally, the analysis shows that government support measures implemented in response to the crisis went to less productive and larger firms, regardless of their pre-crisis innovation. Thus, government support measures during the COVID-19 crisis may have had adverse effects on competition and productivity growth. As economies enter the economic recovery phase, it will be important for policymakers to phase out support measures as soon as appropriate and focus on fostering a competitive business environment.

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Bank Capital and Risk in Europe and Central Asia Ten Years after the Crisis

Cited by 5 publications

References 16 publications

On the measurement of corporate governance and its impact on bank profitability and credit risk: The case of Tunisian listed banks

On the measurement of corporate governance and its impact on bank profitability and credit risk: The case of Tunisian listed banks

Europe and Central Asia Economic Update, Fall 2021: Competition and Firm Recovery post COVID-19

Competition and firm recovery post-COVID-19

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