EU Banks' Profitability and Risk Adjustment Decisions under Basel III

Kód výsledku v IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F00216208%3A11230%2F14%3A10281431" target="_blank" >RIV/00216208:11230/14:10281431 - isvavai.cz</a>

Nalezeny alternativní kódy

RIV/61384399:31110/14:00044602

Výsledek na webu

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DOI - Digital Object Identifier

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Jazyk výsledku

angličtina

Název v původním jazyce

EU Banks' Profitability and Risk Adjustment Decisions under Basel III

Popis výsledku v původním jazyce

This paper uses quantitative modeling methods to assess the potential impact of the new capital requirements defined in Basel III and Capital Requirements Directive IV on European banks. In our analysis we explore the impact of the higher capital requirements on the level of profitability of European banks. More specifically, we try to pinpoint which of the variables, whether increased interest rates resulting from the higher cost of capital, or the decreased risk of undertaken operations, will have themost significance. Based on the results of our analysis which employs a simultaneous equations model on 594 banks operating in the European Union in the period 2006-2011, we conclude that higher capital requirements under the Basel III proposal would cause a decrease in banks' profitability accompanied by a drop in their risk taking. Additionally, we show that a higher level of capital held by banks would cause them to decrease their risky assets held relative to total assets.

Název v anglickém jazyce

EU Banks' Profitability and Risk Adjustment Decisions under Basel III

Popis výsledku anglicky

This paper uses quantitative modeling methods to assess the potential impact of the new capital requirements defined in Basel III and Capital Requirements Directive IV on European banks. In our analysis we explore the impact of the higher capital requirements on the level of profitability of European banks. More specifically, we try to pinpoint which of the variables, whether increased interest rates resulting from the higher cost of capital, or the decreased risk of undertaken operations, will have themost significance. Based on the results of our analysis which employs a simultaneous equations model on 594 banks operating in the European Union in the period 2006-2011, we conclude that higher capital requirements under the Basel III proposal would cause a decrease in banks' profitability accompanied by a drop in their risk taking. Additionally, we show that a higher level of capital held by banks would cause them to decrease their risky assets held relative to total assets.

Druh

J_x - Nezařazeno - Článek v odborném periodiku (Jimp, Jsc a Jost)

CEP obor

AH - Ekonomie

OECD FORD obor

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Projekt

<a href="/cs/project/GA14-02108S" target="_blank" >GA14-02108S: Vzájemná interakce krizí státu a bank</a><br>

Návaznosti

S - Specificky vyzkum na vysokych skolach

Rok uplatnění

2014

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Název periodika

Ekonomický časopis

ISSN

0013-3035

e-ISSN

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Svazek periodika

62

Číslo periodika v rámci svazku

7

Stát vydavatele periodika

SK - Slovenská republika

Počet stran výsledku

25

Strana od-do

667-691

Kód UT WoS článku

000342725500001

EID výsledku v databázi Scopus

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