The long-term role of non-traditional banking in profitability and risk profiles: Evidence from a panel of U.S. banking institutions
AffiliationUniversity of Piraeus
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AbstractThe goal of this empirical study is to identify empirically and on a panel basis how non-traditional bank activities affect directly the profitability and risk profiles of the financial institutions involved in such activities. Through a dataset that covers 1725 U.S. financial institutions involved in non-traditional bank activities spanning the period 2000–2013 and the methodology of panel cointegration, the empirical findings document that non-traditional bank activities exert a positive effect on both the profitability and the insolvency risk. The results could be important for regulators given they could serve as a pre-warning signal that sends a clear message to regulators about the potential systemic risk that exists within the financial markets.
CitationApergis, N., (2014). 'The long-term role of non-traditional banking in profitability and risk profiles: Evidence from a panel of US banking institutions'. Journal of International Money and Finance, 45, pp.61-73. DOI: 10.1016/j.jimonfin.2014.03.003
JournalJournal of International Money and Finance
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