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dc.contributor.authorDing, Dong
Sickles, Robin C.
dc.date.accessioned 2019-01-24T16:07:55Z
dc.date.available 2019-01-24T16:07:55Z
dc.date.issued 2018
dc.identifier.citation Ding, Dong and Sickles, Robin C.. "Frontier efficiency, capital structure, and portfolio risk: An empirical analysis of U.S. banks." BRQ Business Research Quarterly, 21, no. 4 (2018) Elsevier: 262-277. https://doi.org/10.1016/j.brq.2018.09.002.
dc.identifier.urihttps://hdl.handle.net/1911/105117
dc.description.abstract Firm’ ability to effectively allocate capital and manage risks is the essence of their production and performance. This study investigated the relationship between capital structure, portfolio risk levels and firm performance using a large sample of U.S. banks from 2001 to 2016. Stochastic frontier analysis (SFA) was used to construct a frontier to measure the firm's cost efficiency as a proxy for firm performance. We further look at their relationship by dividing the sample into different size and ownership classes, as well as the most and least efficient banks. The empirical evidence suggests that more efficient banks increase capital holdings and take on greater credit risk while reducing risk-weighted assets. Moreover, it appears that increasing the capital buffer impacts risk-taking by banks depending on their level of cost efficiency, which is a placeholder for how productive their intermediation services are performed. An additional finding, is that the direction of the relationship between risk-taking and capital buffers differs depending on what measure of risk is used.
dc.language.iso eng
dc.publisher Elsevier
dc.rightsThis is an open access article under the CC BY-NC-NDlicense(http://creativecommons.org/licenses/by-nc-nd/4.0/).
dc.rights.urihttp://creativecommons.org/licenses/by-nc-nd/4.0/
dc.title Frontier efficiency, capital structure, and portfolio risk: An empirical analysis of U.S. banks
dc.type Journal article
dc.citation.journalTitle BRQ Business Research Quarterly
dc.subject.keywordCapital regulation
Frontier efficiency
Risk
Firm performance
dc.citation.volumeNumber 21
dc.citation.issueNumber 4
dc.identifier.digital Frontier-efficiency
dc.type.dcmi Text
dc.identifier.doihttps://doi.org/10.1016/j.brq.2018.09.002
dc.type.publication publisher version
dc.citation.firstpage 262
dc.citation.lastpage 277


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