Charter value and risk-taking: Evidence from Indian banks

Journal of the Asia Pacific Economy

Volumn 14, Issue 3, 2009, Pages 270-286

  Ghosh, Saibal ^a  

^a RESERVE BANK OF INDIA   (India)

Author keywords

Banking; Capital buffer; Charter value; India; Prudential regulation; Risk taking

Indexed keywords

BANKING; CAPITAL FLOW; COMPETITION (ECONOMICS); CREDIT PROVISION; EFFICIENCY MEASUREMENT; FIRM SIZE; INDUSTRIAL INVESTMENT; INDUSTRIAL PERFORMANCE; RISK ASSESSMENT;

ASIA; EURASIA; INDIA; SOUTH ASIA;

EID: 70449346463     PISSN: 13547860     EISSN: 14699648     Source Type: Journal    
DOI: 10.1080/13547860902975606     Document Type: Article

References (30)

1. Agusman, A., Gasbarro, D., and Zumwalt, J.K., 2006. Bank moral hazard and the disciplining factors of risk taking: evidence from Asian banks during 1998-2003. FMA European Conference, June 2006, Stockholm, Sweden.
2. Arellano, M. and Bond, S., 1991. Some tests of specification for panel data: Monte Carlo evidence and an application to employment equation. Review of economic studies, 58, 277-297.
3. Beck, T. and Laeven, L., 2006. Resolution of failed banks by deposit insurers: cross country evidence. World Bank annual conference on development economics. Washington, DC: World Bank.
4. Berger, A.N. and DeYoung, R., 1997. Problem loans and cost efficiency in commercial banks. Journal of banking and finance, 21 (6), 849-870.
5. Berger, A.N. and Mester, L.J., 2003. Explaining the dramatic changes in performance of US banks: technological change, deregulation and dynamic changes in competition. Journal of financial intermediation, 12 (1), 57-95.
6. Bhide, M.G., Prasad, A., and Ghosh, S., 2001. Banking sector reforms: a critical overview. Economic and political weekly (special issue on money, banking and finance), 37 (5), 399-408.
7. Boubakri, N., et al., 2005. Privatization and bank performance in developing countries. Journal of banking and finance, 29 (8-9), 2015-2041.
8. Boyd, J. and Runkle, D., 1993. Size and performance of banking firms. Journal of monetary economics, 31 (1),47-67.
9. Casu, R. and Molyneux, P., 2003. A comparative study of efficiency in European banking. Applied economics, 35 (17), 1865-1876.
10. Centre for Monitoring the Indian Economy (CMIE), 2007. Prowess database (Release 2.4). CMIE: Mumbai.
11. Demsetz., R.S., Saidenberg, M., and Strahan, P.E., 1996. Banks with something to lose: the disciplinary role of franchise value. Economic policy review the federal reserve bank of New York, 2,1-14.
12. De Nicolo, G., 2000. Size, charter value and risk in banking: an international perspective. IFC discussion paper No. 689. Board of Governors of the Federal Reserve: Washington, DC.
13. Ergungor, O.E., 2004. Marketversus bank-based financial system: do rights and regulations really matter? Journal of banking and finance, 28, 2868-2887.
14. Furlong, F. and Kwan, S., 2005. Market-to-book, charter value and bank risk-taking: a recent perspective. Paper presented at the Basel Committee Research Task Force Conference. Vienna, April.
15. Galloway, T., Lee, W., and Roden, D., 1997. Banks' changing incentives and opportunities for risk taking. Journal of banking and finance, 21 (4), 509-527.
16. Ghosh, S., 2009. Bank risk, charter value and depositor discipline: a simultaneous equations approach. Applied financial economics letters, 16 (6), 239-244.
17. Goldberg, L.G. and Higgings, S.C., 2002. Depositor discipline and changing strategies for regulating thrift institutions. Journal of financial economics, 63 (2), 263-274.
18. Government of India, 1991. Report of the committee on the financial system (Chairman: Shri M. Narasimham). New Delhi.
19. Government of India, 1998. Report of the committee on banking sector reforms (Chairman: Shri M. Narasimham). New Delhi.
20. Gropp, R. and Vesala, J., 2004. Deposit insurance, moral hazard and market monitoring. ECB working paper No.302. ECB: Frankfurt.
21. Hellmann, T.F., Murdock, K.C., and Stiglitz, J.E., 2000. Liberalization, moral hazard in banking, and prudential regulation: are capital requirements enough? American economic review, 90 (1), 147-165.
22. Keeley, M., 1990. Deposit insurance, risk and market power in banking. American economic review, 80 (5),1183-1200.
23. Kwan, S. and Eisenbis, R., 1997. Bank risk, capitalization and operating efficiency. Journal of financial services research, 12 (2), 117-131.
24. Marcus, A., 1984. Deregulation and bank financial policy. Journal of banking and finance, 8, 557-565.
25. Mercieca, S., Schaeck, K., and Wolfe, S., 2007. Small European banks: benefits from diversification? Journal of banking and finance, 31 (7), 1975-1998.
26. Mohan, R., 2004. Financial sector reforms in India: policies and performance analysis. Lecture Delivered at the IMF, Washington, DC. Available from: www.rbi.org.in [Accessed 12 October 2007].
27. Nier, E. and Baumann, U., 2006. Market discipline, disclosure and moral hazard in banking. Journal of financial intermediation, 15 (3), 332-361.
28. Park, S. and Peristiani, S., 1998. Market discipline by thrift depositors. Journal of money, credit and banking, 30 (3), 347-364.
29. Petersen, M. and Rajan, R.G., 1995. The effect of credit market competition on lending relationships. Quarterly journal of economics, 110 (2), 407-443.
30. Reddy, Y.V., 2006. Reforming India's financial sector: changing dimensions and emerging issues. Address delivered at the International Center for Monetary and Banking Studies, Geneva, May. Available from: www.rbi.org.in [Accessed 12 October 2007]. Reserve Bank of India (various years). Report on trend and progress of banking in India. RBI: Mumbai.