Earnings and capital management in alternative loan loss provision regulatory regimes

European Accounting Review

Volumn 17, Issue 3, 2008, Pages 423-445

  Pérez, Daniel ^a   Salas Fumás, Vicente ^a,b   Saurina, Jesús ^a  

^a BANCO DE ESPAÑA   (Spain)

^b UNIVERSITY OF ZARAGOZA   (Spain)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 51249089625     PISSN: 09638180     EISSN: 14684497     Source Type: Journal    
DOI: 10.1080/09638180802016742     Document Type: Article

References (34)

1. Ahmed, A. S., Takeda, C. and Thomas, S. (1999) Bank loan loss provisions: A re-examination of capital management, earnings management and signaling effects. Journal of Accounting and Economics, 28, pp. 1-25.
2. Arellano, M. and Bond, S. (1988) Dynamic panel data estimation using DPD-a guide for users. The Institute for Fiscal Studies
3. Arellano, M. and Bond, S. (1991) Some test of specification for panel data: Monte Carlo evidence and application to employment equations. Review of Economic Studies, 58, pp. 277-297.
4. Ayuso, J., Perez, D. and Saurina, J. (2004) Are capital buffers procyclical? Evidence from Spanish panel data (Special issue: Bank capital adequacy regulation under the new Basel Accord). Journal of Financial Intermediation, 13:2, pp. 249-264.
5. Barnea, A., Ronen, J. and Sadan, S. (1975) The implementation of accounting objectives: An application to extraordinary items. The Accounting Review, 50, pp. 58-68.
6. Beattie, V. A., Casson, P. D., Dale, R. S., McKenzie, G. W., Sutcliffe, C. M. S. and Turner, M. J. (1995) Banks and Bad Debts: Accounting for International Losses in International Banking, Wiley, Chichester
7. Beatty, A., Chamberlain, S. L. and Magliolo, J. (1995) Managing financial reports of commercial banks: The influence of taxes, regulatory capital, and earnings. Journal of Accounting Research, 33:2, pp. 231-261.
8. Beaver, W. H. and Engle, E. E. (1996) Discretionary behaviour with respect to allowance for loan losses and the behaviour of securities prices. Journal of Accounting and Economics, 22, pp. 177-206.
9. Beaver, W. H., Eger, C., Ryan, S. and Wolfson, M. (1989) Financial reporting, supplemental disclosures and bank share price. Journal of Accounting Research, 27, pp. 157-178.
10. Collins, J. H., Shackelford, D. A. and Wahlen, J. M. (1995) Bank differences in the co-ordination of regulatory capital, earnings, and taxes. Journal of Accounting Research, 33:2, pp. 263-291.
11. Dye, R. A. (1988) Earnings management in an overlapping generations model. Journal of Accounting Research, 26:2, pp. 195-235.
12. Evans, J. H. and Sridhar, S. S. (1996) Multiple control systems, accrual accounting, and earnings management. Journal of Accounting Research, 34:1, pp. 45-65.
13. Fernandez de Lis, S., Martinez, J. and Saurina, J. (2001) Credit growth, problem loans and credit risk provisioning in Spain, included. Marrying the Macro- and Micro-aspects of Financial Stability, pp. 331-353.
14. Fudenberg, D. and Tirole, J. (1995) A theory of income and dividend smoothing based on incumbency rents. Journal of Political Economy, 103:1, pp. 75-93.
15. Goel, A. M. and Thakor, A. V. (2003) Why do firms smooth earnings?. Journal of Business, 76:1, pp. 151-192.
16. Greenawalt, M. B. and Sinkey, J. (1976) Bank loan loss provisions and the income-smoothing hypothesis: An empirical analysis. Journal of Financial Services Research, 1, pp. 301-318.
17. Holmstrom, B. and Tirole, J. (2000) Liquidity and risk management. Journal of Money, Credit and Banking, 32, pp. 295-319.
18. Jimenez, G. and Saurina, J. (2006) Credit risk, credit cycles and prudential regulation. International Journal of Central Banking, 2:2, pp. 65-98.
19. Kim, M. and Kross, W. (1998) The impact of the 1989 change in bank capital standards on loan loss provisions and write-offs. Journal of Accounting and Economics, 25, pp. 69-99.
20. Laeven, L. and Majnoni, G. (2003) Loan loss provisioning and economic slowdowns: Too much, too late?. Journal of Financial Intermediation, 12, pp. 178-197.
21. Lambert, R. A. (1984) Income smoothing as rational equilibrium behavior. The Accounting Review, pp. 604-618.
22. Liu, C., Ryan, S. G. and Wahlen, J. M. (1997) Differential valuation implications of loan loss provisions across banks and fiscal quarters. The Accounting Review, 72:3, pp. 133-146.
23. Ma, C. K. (1988) Loan loss reserves and income smoothing: The experience in the U.S. banking industry. Journal of Business Finance & Accounting, 15:4, pp. 487-497.
24. Moyer, S. E. (1990) Capital adequacy ratio regulations and accounting choices in commercial banks. Journal of Accounting and Economics, 13, pp. 123-154.
25. Ronen, J. and Sadan, S. (1981) Smoothing Income Numbers: Objectives, Means, and Implications, Addison-Wesley, Reading, MA
26. Rozycki, J. J. (1997) A tax motivation for smoothing earnings. Quarterly Review of Economics and Finance, 37, pp. 563-578.
27. Schipper, K. (1989) Commentary on earnings management. Accounting Horizons, pp. 92-106.
28. Scholes, M. S., Wilson, G. P. and Wolfson, M. A. (1990) Tax planning, regulatory capital planning, and financial reporting strategy for commercial banks. The Review of Financial Studies, 3:4, pp. 625-650.
29. Soderstrom, N. and Sun, K. J. (2007) A review of the accounting quality after IFRS adoption in the European Union. European Accounting Review, 16:4, pp. 675-702.
30. Trueman, B. and Titman, B. (1988) An explanation of accounting income smoothing. Journal of Accounting Research, 26, pp. 127-139.
31. Wahlen, J. M. (1994) The nature of information in commercial bank loan loss disclosures. The Accounting Review, 69:3, pp. 455-478.
32. Wall, L. and Koch, T. W. (2000) Bank loan loss accounting: A review of theoretical and empirical evidence. Economic Review, 85:2, pp. 1-19.
33. Wetmore, J. L. and Brick, J. R. (1994) Loan loss provisions of commercial banks and adequate disclosure: A note. Journal of Economics and Business, 46, pp. 299-305.
34. World Bank (2002) Bank loan classification and provisioning practices in selected developed and emerging countries. Finance Forum