Risk management, corporate governance and financial performance of the banking system in Romania

Abstract

The recent global financial crisis has raised a number of questions with regard to corporate governance of banking financial institutions. There was a series of “voices” that expressed their concern and even the lack of confidence in the role of corporate governance at the banking system level, and not only, in preventing the effects of this crisis. The main objective of this research is constituted by the study of the corporate governance influence at the banking system level in Romania on the risks management area and of banking financial performances. The used research methodology is predominantly quantitative. This methodology is based on a descriptive statistics, having as objective the analysis of corporate governance characteristics, the appreciation of the risks management level and the performances recorded at the level of the Romanian banking system. In the realisation of this study, the calculation of central tendency indicators, dispersion and form of distribution were used with the help of the SPSS software under Windows (Descriptive Statistics).

The Relationship Between Corporate Governance Mechanisms and Financial Institution Performance. A COVID-19 Perspective

“…The results suggest that the quality of the external auditor has an insignificant impact on the performance of the Romanian banks. By using the metrics such as risk committee, Chief Risk Officer at bank level, board size, board independence, financial experience of members, return of assets, return of equity, bank size, share banks deposit or share of credit granted for corporate governance, risk management and financial performance, Bunea et al (2018) studied the relationship between risk management, corporate governance, and financial performance of the Romanian banking system. The authors study reveals that the financial experience of the members has a positive impact on the banks' performance.…”

“…The corporate governance topic has been extensively debated at both national and international levels in the last 12 years, especially in Romania, when the Bucharest Stock Exchange Code of Corporate Governance was introduced for the first time. Furthermore, corporate governance was studied with other economic mechanisms such as corporate governance models (Karpoff, 2021), corporate governance quality (Matić & Papac, 2014), bank risk (Felício et al, 2018), corporate social responsibility (Skare & Golja, 2012;Stuebs & Sun, 2015;Dwekat et al, 2020), audit fees (Hay et al, 2008) or financial performance (Amole et al, 2021; Al-Jaifi, 2020; Andrieș et al, 2018;Bunea et al, 2018).…”

The Relationship Between the Boards Characteristics and the Risk Management of the Romanian Banking Sector

“…Through this work, the authors are proposing to make an analysis of the impact of the structure of the boards of directors (by dimension, gender diversity, education, nationality and age of the members) on the performance and management of the risks on the Romanian banking system level. In what concerns the characteristics of the members of the board of directors, these were the subject of some previous researches such as: the gender diversity (Barber & Odean, 2001;Carter et al, 2003;Erhardt et al, 2003;Dutta & Bose, 2006;Bunea et al, 2018), the age (Hambrick & Mason, 1984;Barker & Mueller, 2002;Belenzon et al, 2019), education (Mintzberg, 2004;Gottesman & Morey, 2010;Almășan et al, 2019), the origin country or nationality (Crossland & Hambrick, 2011;Ioannou & Serafeim, 2012;Boone et al, 2019). Avram et al (2019) have noticed that one of the factors that affect the clarity when it comes to reporting the financial information, is the culture of the country in which the company is located.…”