scholarly journals Geographic Diversification and Banks’ Funding Costs

2020 ◽  
Author(s):  
Ross Levine ◽  
Chen Lin ◽  
Wensi Xie
Keyword(s):  
Geographic Diversification ◽  
Risk Diversification ◽  
Geographic Expansion ◽  
The Impact ◽  
Identification Strategy

We assess the impact of geographic diversification on a bank’s costs of interest-bearing liabilities. We employ a new identification strategy and discover that geographic expansion across U.S. states lowered funding costs. Consistent with expansion facilitating risk diversification, we find that (1) funding costs fall more when banks expand into states whose economies are less correlated with the banks’ state and (2) geographic diversification reduces the costs of uninsured, but not insured, deposits. Consistent with expansion intensifying agency frictions, which puts upward pressures on funding costs, we discover that geographic diversification reduces the costs of interest-bearing liabilities more in better-monitored and better-run banks. This paper was accepted by Tomasz Piskorski, finance.

scholarly journals Geographical Diversification Effects on Banks’ Performance: Evidence from Islamic Banks of some Selected Countries

2020 ◽  
Vol 27 (2) ◽  
pp. 15
Author(s):  
Faten Zoghlami
Keyword(s):  
Credit Risk ◽  
Home Country ◽  
Islamic Banks ◽  
Geographic Diversification ◽  
Bank Managers ◽  
Geographic Expansion ◽  
Loan Quality ◽  
Loan Growth ◽  
The Impact ◽  
Geographical Diversification

This paper investigates the impact of geographic diversification onthe performance of Islamic banks. Using an unbalanced panel dataset of 54 Islamic banksimplemented in the GCC and Southeast Asia regions, during the 2004-2016 period,the core question is to analyze the effect of both diversification intra and beyond homecountries on Islamic banks credit risk, stability, and profitability. This research assertsthat geographical diversification within the home country seems to enhance Islamic bankstability, profitability but does not improve loan quality. More pronounced results arereported when banks expand intra and beyond the home country frontier. These findingsare consistent with the view that geographic expansion helps to strengthen stabilitythrough diversification of the specific region risk, but the related loan growth makes itmore difficult to assess and monitor credit risk. These findings have strategic implicationsfor bank managers, regulators, and supervisors about the consequences of Islamic bankgeographic expansion.

scholarly journals Does the target market affect bank performance? Evidence from the geographic diversification of city commercial banks in China

2021 ◽  
Vol 15 (1) ◽  
Author(s):  
Xiaonan Li ◽  
Chang Song
Keyword(s):  
Commercial Banks ◽  
Banking Sector ◽  
Capital Adequacy ◽  
Bank Performance ◽  
Chinese Government ◽  
Target Market ◽  
Geographic Diversification ◽  
Cross Sectional ◽  
The Impact ◽  
Geographical Diversification

AbstractAfter the opening up of the banking sector to domestic and foreign capitals which is approved by the Chinese government, the China Banking Regulatory Commission (CBRC) has permitted city commercial banks to diversify geographically. Since this deregulation in 2006, city commercial banks began to geographically diversify to occupy the market and acquire more financial resources. To examine the causal relationship between geographical diversification and bank performance, we construct an exogenous geographical diversification instrument using the gravity-deregulation model and a policy shock. We find that bank geographical diversification negatively affects bank performance. Moreover, we conduct some mechanism tests in the Chinese context. We find that the target market with several large- and medium-sized banks and a high level of local protectionism in the target market decreases the performance of city commercial banks. Finally, cross-sectional analyses show that the impact of geographical diversification on banks’ performance is more notable among city commercial banks that are younger, and have a lower capital adequacy ratio and a higher non-performing loan ratio.

Does board independence constrain insider opportunism?

2020 ◽  
pp. 031289622094638
Author(s):  
Dewan Rahman ◽  
Robert Faff ◽  
Barry Oliver
Keyword(s):  
Research And Development ◽  
Insider Trading ◽  
Jel Classification ◽  
Independent Directors ◽  
Board Independence ◽  
Exogenous Shocks ◽  
Sarbanes Oxley ◽  
Trading Restrictions ◽  
The Impact ◽  
Identification Strategy

We examine whether insider opportunism is reduced by board independence. Using a sample of 18,194 firm-year observations over the period 1996–2016, we show that board independence constrains opportunistic insider trading. Our identification strategy uses the Sarbanes–Oxley Act of 2002 (SOX Act) and associated changes to the listing rules of NYSE/NASDAQ as a source of exogenous shocks in board independence. Our results are economically significant as insider opportunism declines by about 10.5%. We find that insider trading restrictions is the channel through which board independence reduces insider opportunism. Our additional analyses show that in competitive and R&D (research and development) intensive firms, the impact of board independence on opportunism is less pronounced. We also find that board independence constrains opportunism only in less complex firms. However, in co-opted boards, independent directors are less effective. Overall, we support the monitoring channel of board independence for reducing insider opportunism. JEL Classification: G14, G34, G40

Geographic Expansion of Dengue: The Impact of International Travel

2008 ◽  
Vol 92 (6) ◽  
pp. 1377-1390 ◽  
Author(s):  
Annelies Wilder-Smith ◽  
Duane J. Gubler
Keyword(s):  
International Travel ◽  
Geographic Expansion ◽  
The Impact

scholarly journals Peer effects in college: how peers' performance can influence students' academic outcomes

2021 ◽  
Author(s):  
Laeticia R. de Souza ◽  
Cristine Campos de Xavier Pinto ◽  
Bernardo L Queiroz ◽  
Dimitri de Oliveira e Silva
Keyword(s):  
Peer Effects ◽  
Academic Outcomes ◽  
Female Students ◽  
Male Students ◽  
Dropping Out ◽  
Admission Process ◽  
Self Selection ◽  
The Impact ◽  
High Ability Students ◽  
Identification Strategy

This paper investigates the existence of peer effects in academic outcomes by exploringspecificities in the student's admission process of a Brazilian federal university, which works as a naturalexperiment. Individuals who are comparable in terms of previous academic achievement end up havingclassmates with better or worse performance in college because of the assignment rule of students toclassrooms. Thus, our identification strategy for estimating peer effects on academic outcomes eliminates theendogenous self-selection into groups that would otherwise undermine the causal inference of peer effects.Overall, our findings showed that joining a class with high-ability students damages academic achievementsof the lowest-ability students at UFMG. Although male and female students are both negatively affected bybeing in the first (better) class, we found gender differences. Specifically, being at the bottom of the betterclass make females take less radical decisions compared to male students in the sense that female studentscontinue to study even though with lower performance (reduced GPA and credits earned) while male studentsseem to be more prone towards dropping out (increased number of subjects – or even University registration– cancelled and reduced attendance in classroom). We have also found other heterogeneities in peer effectsin college in terms of class shift, period of admission, area of study and parents’ education. This study is anecessary step before investigating the impact of peer quality on after-graduating decisions using the samenatural experiment. This will allow us to deepen our understanding of how peer effects can also have long-lasting impacts.

scholarly journals The Impact of Corporate Diversification and Financial Structure on Firm Performance: Evidence from South Asian Countries

2019 ◽  
Vol 12 (1) ◽  
pp. 49 ◽  
Author(s):  
Rashid Mehmood ◽  
Ahmed Hunjra ◽  
Muhammad Chani
Keyword(s):  
Financial Performance ◽  
South Asian ◽  
Financial Structure ◽  
Manufacturing Firms ◽  
Product Diversification ◽  
Corporate Diversification ◽  
Asian Countries ◽  
Geographic Diversification ◽  
Dynamic Panel ◽  
The Impact

We examined the impact of corporate diversification and financial structure on the firms’ financial performance. We collected data from 520 manufacturing firms from Pakistan, India, Sri Lanka, and Bangladesh. We used panel data of 14 years from 2004–2017 to analyze the results. We applied a two-step dynamic panel approach to analyze the hypotheses. We found that product diversification and geographic diversification significantly affected the firms’ financial performance. We further found that dividend policy and capital structure had a significant impact on the firm’s financial performance.

scholarly journals Employment Protection Deregulation and Labor Shares in Advanced Economies

2020 ◽  
pp. 1-44
Author(s):  
Gabriele Ciminelli ◽  
Romain Duval ◽  
Davide Furceri
Keyword(s):  
Employment Protection ◽  
Elasticity Of Substitution ◽  
Negative Effects ◽  
Labor Share ◽  
Advanced Economies ◽  
The Impact ◽  
Identification Strategy

This paper assesses the impact of job protection deregulation on the labor share in a sample of 26 advanced economies during the 1970-2013 period, using a newly constructed dataset of major reforms in this area. We employ a difference-indifferences identification strategy using two identifying assumptions grounded in theory – deregulation has larger effects in industries characterized by (i) a higher ‘natural’ propensity to regularly adjust the workforce, and (ii) a lower elasticity of substitution between capital and labor. We find significant negative effects of deregulation on the labor share, contributing to about a tenth of its observed decline in advanced economies.

Diversification, family involvement and firm performance

2016 ◽  
Vol 35 (5) ◽  
pp. 663-680 ◽  
Author(s):  
Emanuela Delbufalo ◽  
Sara Poggesi ◽  
Simone Borra
Keyword(s):  
Firm Performance ◽  
Family Involvement ◽  
Fixed Effects ◽  
Product Diversification ◽  
Geographic Diversification ◽  
Content Type ◽  
The Status ◽  
The Impact ◽  
Italian Manufacturing Firms ◽  
Moderating Role

Purpose – The purpose of this paper is to investigate the effect of product and geographic diversification on the performance of Italian manufacturing firms and evaluate the moderating role of family involvement. Design/methodology/approach – The hypotheses have been tested by using a fixed-effects panel data regression model. Findings – Results show a linear relationship between product diversification and firm performance and an inverted U-shaped relationship between geographic diversification and firm performance. Moreover, when considering the status of the family firm, family ties have a negative moderating role on the performance of companies that are product and internationally diversified. Originality/value – By providing theoretical explanations and empirical evidence, the study extends the diversification-performance research by testing this relationship in an unexplored context (i.e. Italy), and by identifying a still not well explored contingency factor (i.e. family involvement). In doing so, diversification and family involvement literatures are brought together and the results show the importance of the type of owner regarding the impact of product and international diversification on firm performance.

Sign in / Sign up

Export Citation Format

Share Document