increase prevails through a second channel: an increase in risk shifting. (3) Risk shifting decreases with the diversification …We present a model where bank assets are a portfolio of risky debt claims and analyze stockholders' risk … increases, risk shifting by borrowers increases, even if their leverage is unchanged (zombie lending). (2) While the literature …

adverse selection and moral hazard problems leading to higher bank risk. The revenue diversification channel suggests that as …We show that bank risk rises, particularly for larger banks and those with greater interest-sensitive liabilities …, during times of economic policy uncertainty through two economic channels: ‘credit rationing’ and ‘revenue diversification …

In the traditional banking model, loans play a dominant role in banks’ operations. Loan portfolio quality is the main … amount of non-performing loans may not only reduce the financial results, but also reduce the capital and increase the risk … profile of the bank. This paper investigates the influence of the non-performing loans ratio on profitability indicators in …

This study investigated the impact of banking management on credit risk using a sample of Indian commercial banks. The … study employed dynamic panel estimations to evaluate the link between banking management variables and credit risk. The … findings suggest that high capital requirements and large bank size do not reduce default risk, whereas high profitability and …

The paper examines whether bank diversification in multiple dimensions can protect bank lending from uncertainty shocks … banking by the dispersion of bank-level shocks. Our results confirm that banks may reduce loan growth and experience more … credit risk amid greater uncertainty. These adverse impacts of uncertainty on bank lending (both quantity and quality) are …

asset correlation parameter shrinks due to diversification effects …

This Paper investigates the effects of competition on credit risk, overall bank risk and revenue diversification for … fluctuation in the level of non-performing loan risk, ASEAN banks engaged in more revenue diversification activities to offset the … increasing overall bank risk level by utilizing various risk-mitigating strategies. During crisis years, banks failed to control …

-offs and write-downs, we examine the impact of loan portfolio sector concentration on credit risk. By controlling for common … risk factors, we separate the bank-specific selection and monitoring abilities from the composition of the loan portfolio …