Risk, Capital and Efficiency in Chinese Banking

Yong Tan, Christos Floros

Research output: Contribution to journalArticle

48 Citations (Scopus)

Abstract

We assess the relationship between bank efficiency, risk and capital for a sample of Chinese commercial banks employing three efficiency indexes and four risk indicators under a three stage least square method in a panel data framework. The empirical evidence suggests that there is a positive and significant relationship between risk (loan-loss provision as a fraction to total loans or LLPTL) and efficiency in Chinese banking industry, while the relationship between risk (Z-score) and level of capitalization is negative and significant.

LanguageEnglish
Pages378-393
Number of pages16
JournalJournal of International Financial Markets, Institutions and Money
Volume26
Issue number1
DOIs
Publication statusPublished - Oct 2013

Fingerprint

Risk capital
Banking
Commercial banks
Panel data
Z-score
Banking industry
Least square method
Efficiency index
Loan loss provisions
Empirical evidence
Three-stage least squares
Bank efficiency
Loans
Capitalization

Cite this

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Risk, Capital and Efficiency in Chinese Banking. / Tan, Yong; Floros, Christos.

In: Journal of International Financial Markets, Institutions and Money, Vol. 26, No. 1, 10.2013, p. 378-393.

Research output: Contribution to journalArticle

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