Kanagaretnam, Kiridaran; Lobo, Gerald J.; Mathieu, Robert - In: Review of Accounting and Finance 3 (2004) 1, pp. 128-148
Prior research demonstrates that share prices reflect a risk premium that is associated with earnings variability. This suggests that managers can reduce the cost of capital and increase share prices by reducing earnings variability. In this study, we investigate bank managers' use of discretion...