Bank regulation and financial fragility in developing countries: Does bank structure matter?
Year: 2015
Type: article
Abstract: Using data for 1238 banks located in 94 developing and emerging countries, we explore whether the impact of bank regulation and supervision on banking risk (measured by the banks’ Z-scores) depends on bank structure. Our findings suggest that stricter regulation and supervision increases the banks’ Z-scores. Notably capital requirements and supervisory control diminish banking risk. However, the effectiveness of other dimensions of regulation and supervision depends on the organizational structure of banks. Notably activity restrictions reduce risk of large and foreign owned banks, while liquidity restrictions have most effect on the Z-scores of unlisted and commercial banks.
Source: Review of Development Finance
Authors: Jeroen Klomp, Jakob de Haan
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W2216038188