COVID-19 outbreak, government capital injections, and shadow banking efficiency

Li, Xuelian; Xie, Yuxin; Lin, Jyh Horng

doi:10.1080/00036846.2020.1808183

Cited by 24 publications

(19 citation statements)

References 24 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…However, limited research has been conducted on the potential impact of COVID-19 on financial institutions, particularly bank stability. Several studies focus on systemic risk [6], stock return [44], credit risk [45], and the capital stock option of the bank [46], while Scherf et al [47] focus on national lockdown restrictions in the news. They discovered a negative reaction in the stock market as a result of the lockdown restrictions announcement.…”

Section: -Literature Reviewmentioning

confidence: 99%

Bank Concentration and Bank Stability during the COVID-19 Pandemic

Riadi

Hadjaat²,

Yudaruddin³

2022

Emerg Sci J

View full text Add to dashboard Cite

Objectives: The banking sector has been impacted more negatively by the COVID-19 pandemic. At the same time, bank concentration and capitalization stabilize banking systems during times of crisis. This study evaluated the monthly financial reports of all commercial banks in Indonesia to investigate the joint impact of the COVID-19 pandemic and bank concentration on bank stability. Moreover, this study was conducted to determine whether adequate capitalization could enhance the positive effect of the interaction between COVID-19 and bank concentration during the pandemic. Methods/Analysis: Using 108 commercial banks between March 2020 and May 2021, data were analyzed using the fixed-effects estimator with heteroskedasticity and within-panel serial correlations for robust standard errors. Several robustness checks were performed to ensure that the results were accurate and consistent. Findings: Subsequently, the impact of the pandemic and bank concentration was determined to be significant and adverse, though their interplay was strong enough to promote bank stability. This highlights the importance of adequate capitalization in enhancing the beneficial effects of the interaction between COVID-19 and bank concentration on bank stability. Novelty /Improvement: Hence, these ﬁndings contribute to the literature on bank stability and have important policy implications for the banking sector during this pandemic.JEL Classifications: E51, G20, G21. Doi: 10.28991/esj-2022-SPER-018 Full Text: PDF

show abstract

Section: -Literature Reviewmentioning

confidence: 99%

Bank Concentration and Bank Stability during the COVID-19 Pandemic

Riadi

Hadjaat²,

Yudaruddin³

2022

Emerg Sci J

View full text Add to dashboard Cite

show abstract

“…The pandemic and its associated effects are highly researched in the discipline of economic sciences. The research based on COVID-19 has disclosed potential implications in banking (Li, Xie, & Lin, 2021), insurance (Richter & Wilson, 2020), exchange rates (Umar & Gubareva, 2020), financial systems (Zhang et al, 2020), and market liquidity risk (Saleemi, 2021). The liquidity risk matters to investors, and it immediately affects a trader's movements in the financial market (Guijarro et al, 2019).…”

Section: Review Of Literaturementioning

confidence: 99%

Crypto Market and Liquidity Risk in Environments due to Pandemic Uncertainty

Saleemi¹

2022

jcrbef

View full text Add to dashboard Cite

The recent pandemic is still under debate and is raising concerns about future economic perspectives. This work investigates whether liquidity is priced in various cryptocurrencies’ returns, and if the relationship has been affected during the COVID-19 period. In a particular trading session analyzed before the pandemic uncertainty, liquidity was priced in returns on Bitcoin, Cardano, and XRP. However, the findings have changed due to the pandemic crisis. During the pandemic uncertainty, liquidity was found to be priced in Cardano returns during the same trading session. In addition, the liquidity cost imposed against accepting the position of Tether on day t-1 was noted to be priced in its returns for day t.

show abstract

“…Li et al ( 2021 ) show that the COVID-19 crisis adversely affects banking stability and makes it more prone to risk-taking. They also highlight that the COVID-19 outbreak and government capital injections harm the efficiency gain from shadow banking.…”

Section: Background Of the Topicmentioning

confidence: 99%

COVID-19 pandemic risk and probability of loan default: evidence from marketplace lending market

Nigmonov

Shams

2021

Financ Innov

View full text Add to dashboard Cite

As the COVID-19 pandemic adversely affects the financial markets, a better understanding of the lending dynamics of a successful marketplace is necessary under the conditions of financial distress. Using the loan book database of Mintos (Latvia) and employing logit regression method, we provide evidence of the pandemic-induced exposure to default risk in the marketplace lending market. Our analysis indicates that the probability of default increases from 0.056 in the pre-pandemic period to 0.079 in the post-pandemic period. COVID-19 pandemic has a significant impact on default risk during May and June of 2020. We also find that the magnitude of the impact of COVID-19 risk is higher for borrowers with lower credit ratings and in countries with low levels of FinTech adoption. Our main findings are robust to sample selection bias allowing for a better understanding of and quantifying risks related to FinTech loans during the pandemic and periods of overall economic distress.

show abstract

COVID-19 outbreak, government capital injections, and shadow banking efficiency

Cited by 24 publications

References 24 publications

Bank Concentration and Bank Stability during the COVID-19 Pandemic

Bank Concentration and Bank Stability during the COVID-19 Pandemic

Crypto Market and Liquidity Risk in Environments due to Pandemic Uncertainty

COVID-19 pandemic risk and probability of loan default: evidence from marketplace lending market

Contact Info

Product

Resources

About