Bank Activity and Funding Strategies : The Impact on Risk and Returns

Demirgü ; ç ; -Kunt, Asli ; Huizinga, Harry

关键词: ACCOUNTING;    AGENCY PROBLEMS;    ANNUAL INFLATION RATE;    ANNUAL STATEMENTS;    ASSET GROWTH;   

DOI  :  10.1596/1813-9450-4837
RP-ID  :  WPS4837

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This paper examines the implications ofbank activity and short-term funding strategies for bankrisk and returns using an international sample of 1,334banks in 101 countries leading up to the 2007 financialcrisis. Expansion into non-interest income generatingactivities such as trading increases the rate of return onassets, and it may offer some risk diversification benefitsat very low levels.Non-deposit, wholesale funding, bycontrast, lowers the rate of return on assets, although itcan offer some risk reduction at commonly observed lowlevels of non-deposit funding. A sizeable proportion ofbanks, however, attract most of their short-term funding inthe form of non-deposits at a cost of enhanced bankfragility. Overall, banking strategies that rely prominentlyon generating non-interest income or attracting non-depositfunding are very risky, which is consistent with the demiseof the U.S. investment banking sector.