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.
| Original language | English |
|---|---|
| Pages (from-to) | 378-393 |
| Number of pages | 16 |
| Journal | Journal of International Financial Markets, Institutions and Money |
| Volume | 26 |
| Issue number | 1 |
| DOIs | |
| Publication status | Published - Oct 2013 |