Does Regulatory Governance Matter for Financial System Stability? An Empirical Analysis

Quintyn, Marc; Chenard, Kina

doi:10.2139/ssrn.878912

Cited by 12 publications

(8 citation statements)

References 29 publications

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“…Further analysis and robust testing of the research hypotheses will deepen the understanding of the link between risk governance characteristics, RAs and bank stability (Francis and Osborne, 2012). Future research, incorporating additional variables and advanced statistical techniques, has the potential to expand upon the current findings and provide more nuanced insights into the dynamics of risk governance in the banking sector (Quintyn and Chenard, 2004;Ferretti, 2008, 2013).…”

Section: Risk Governance and Regulatory Adjustmentsmentioning

confidence: 94%

“…It also acknowledges the importance of regulatory compliance in ensuring financial stability and protecting stakeholders' interests (Francis and Osborne, 2012). Effective risk governance practices play a crucial role in facilitating regulatory compliance and contributing to the overall stability and performance of banks (Quintyn and Chenard, 2004).…”

Section: Theory Literature Review and Hypothesis Developmentmentioning

confidence: 99%

“…This study explores the relationship between risk governance characteristics and RAs in OECD public commercial banks. It distinguishes between banks' compliance and specific regulatory mandates informed by Quintyn and Chenard (2004). Focusing on OECD standards, the research examines how governance impacts financial stability and performance.…”

Section: Introductionmentioning

confidence: 99%

“…Second, correlation analysis was conducted to explore the associations between risk governance characteristics and RAs, providing insights into their relationships. Last, PCA was used to identify the underlying structure of risk governance characteristics, reducing data dimensionality and aiding in the identification of critical risk governance factors (Quintyn and Chenard, 2004; Chao and Wu, 2017).…”

Section: Introductionmentioning

confidence: 99%

“…Based on the findings, one perspective to consider is that, instead of focusing exclusively on controlling bank risk, shareholders might benefit from exploring the restructuring of risk governance as a means to enhance the effectiveness of risk management (Nguyen and Dang, 2022; Srivastav and Hagendorff, 2016). Based on the findings, one perspective to consider is that, instead of focusing exclusively on controlling bank risk, shareholders might benefit from exploring the restructuring of risk governance as a means to enhance the effectiveness of risk management (Nguyen and Dang, 2022; Quintyn and Chenard, 2004). Additional research could expand upon this study by exploring a broader range of risk governance characteristics and analyzing their influence on regulatory adaptations within the banking sector (Nguyen and Dang, 2022).…”

Section: Introductionmentioning

confidence: 99%

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Risk governance and regulatory adjustments in the public commercial banks of OECD

Malik

2024

JFRC

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Purpose This study aims to explore the relationship between risk governance characteristics (chief risk officer [CRO], chief financial officer [CFO] and senior directors [SENIOR]) and regulatory adjustments (RAs) in Organization for Economic Cooperation and Development public commercial banks. Design/methodology/approach Using principal component analysis (PCA) and regression models, the research analyzes a representative data set of these banks. Findings A significant negative correlation between risk governance characteristics and RAs is found. Sensitivity analysis on the regulatory Tier 1 capital ratio and the total capital ratio indicates mixed outcomes, suggesting a complex relationship that warrants further exploration. Research limitations/implications The study’s limited sample size calls for further research to confirm findings and explore risk governance’s impact on banks’ capital structures. Practical implications Enhanced risk governance could reduce RAs, influencing banking policy. Social implications The study advocates for improved banking regulatory practices, potentially increasing sector stability and public trust. Originality/value This study contributes to understanding risk governance’s role in regulatory compliance, offering insights for policymaking in banking.

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Section: Risk Governance and Regulatory Adjustmentsmentioning

confidence: 94%

Section: Theory Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Risk governance and regulatory adjustments in the public commercial banks of OECD

Malik

2024

JFRC

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Financial Intermediation Modernization in Countries with Transition Economy

et al. 2009

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Who pays for banking supervision? Principles and trends

Masciandaro

Nieto

Prast

2007

Journal of Financial Regulation and Compliance

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If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services. AbstractPurpose -This paper aims to analyse the economics of financing banking supervision and attempts to respond to two questions: What are the most common financing practices? Can the differences in current financing practices be explained by country-specific factors, using a path-dependence approach? Design/methodology/approach -The paper performs an empirical analysis that identifies the determinants of the financing structure of banks' prudential supervision using a sample of 90 banking supervisors (central banks and financial authorities). Findings -The paper concludes that supervisors in central banks are more likely to be publicly funded, while financial authorities are more likely to be funded via a levy on the regulated banks. The financing rule is also explained by the structure of the financial systems. Public funding is more likely in bank-oriented structures. Finally, the geographical factor is also significant: European bank supervisors are more oriented towards the private funding regime. Practical implications -In general, the paper does not find evidence of the role of the political factor, the size of the economy, the level of development and the legal tradition. Originality/value -The paper analyses the financial governance of banking supervision in a sample of 90 countries world-wide. The empirical analysis focuses on the financing rules and identifies factors that explain the differences between supervisory authorities.

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Does Regulatory Governance Matter for Financial System Stability? An Empirical Analysis

Cited by 12 publications

References 29 publications

Risk governance and regulatory adjustments in the public commercial banks of OECD

Risk governance and regulatory adjustments in the public commercial banks of OECD

Financial Intermediation Modernization in Countries with Transition Economy

Who pays for banking supervision? Principles and trends

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