Journal of Financial Regulation and Compliance最新文献

{"title":"Do cryptocurrency investors in the UK need more protection?","authors":"Yanqing Wang","doi":"10.1108/jfrc-03-2023-0036","DOIUrl":"https://doi.org/10.1108/jfrc-03-2023-0036","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>The existing literature offers various perspectives on integrating cryptocurrencies into investment portfolios; yet, there is a gap in understanding the behaviours, attitudes and cross-investment links of individual investors. This study, grounded in the modern portfolio theory and the random walk theory, aims to add empirical insights that are specific to the UK context. It explores four hypotheses related to the influence of socio-demographics, digital adoption, cross-investment behaviours and financial attitudes on cryptocurrency owners.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>This study uses a logistic regression model with secondary data from the Financial Lives Survey 2020 to assess the factors impacting cryptocurrency ownership. A total of 29 variables are used, categorized into four groups aligned with the hypotheses. Additionally, hierarchical clustering analysis was conducted to further explore the cross-investment links.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The study reveals a significant lack of diversification among UK cryptocurrency investors, a pronounced inclination towards high-risk investments such as peer-to-peer lending and crowdfunding, and parallels with gambling behaviours, including financial dissatisfaction and a propensity for risk-taking. It highlights the influence of demographic traits, risk tolerance, technological literacy and emotional attitudes on cryptocurrency investment decisions.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This study provides valuable insights into cryptocurrency regulation and retail investor protection, underscoring the necessity for tailored financial education and a holistic regulatory approach for investment products with comparable risk levels, with the aim of minimizing regulatory arbitrage. It significantly enhances our understanding of the unique dynamics of cryptocurrency investments within the evolving financial landscape.</p><!--/ Abstract__block -->","PeriodicalId":44814,"journal":{"name":"Journal of Financial Regulation and Compliance","volume":"34 1","pages":""},"PeriodicalIF":0.9,"publicationDate":"2024-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139516357","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Shadow banking and non-performing loans: international evidence","authors":"Mugabil Isayev, Omar Farooq","doi":"10.1108/jfrc-07-2023-0105","DOIUrl":"https://doi.org/10.1108/jfrc-07-2023-0105","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This paper aims to document the impact of shadow banking on non-performing loans (NPLs) of publicly listed banks in an international setting.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>This paper uses the data from 27 countries and various estimation strategies to test the arguments presented in this paper. The sample covers the period between 2002 and 2020.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The empirical results suggest that banks headquartered in countries with high shadow banking activity have fewer NPLs than otherwise similar banks headquartered in countries with low shadow banking activity. The findings remain qualitatively the same in different sub-samples and after replacing the main variables with their alternate proxies. The paper also shows that this relationship is sensitive to bank-specific characteristics. Moreover, the paper also indicates that the stringency of banking regulations weakens the relationship between shadow banking and NPLs.</p><!--/ Abstract__block -->\u0000<h3>Research limitations/implications</h3>\u0000<p>The study’s data limitations prevent a detailed year-by-year analysis of NPLs and shadow banking, restricting insights into their evolving dynamics. In addition, the focus on country-level shadow banking data limits the exploration of how multinational banks’ activities in various jurisdictions impact individual banks’ NPLs.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>The paper not only documents the effect of shadow banking on NPLs but also shows that the relationship between shadow banking and NPLs weakens as banking regulations become more stringent.</p><!--/ Abstract__block -->","PeriodicalId":44814,"journal":{"name":"Journal of Financial Regulation and Compliance","volume":"54 1","pages":""},"PeriodicalIF":0.9,"publicationDate":"2024-01-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139373832","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Factors and determinants affecting banking sector stability: empirical evidence from conventional and Islamic banks listed on the Palestine stock exchange","authors":"N. Badwan, Besan Saleh, Montaser Hamdan","doi":"10.1108/jfrc-07-2023-0108","DOIUrl":"https://doi.org/10.1108/jfrc-07-2023-0108","url":null,"abstract":"\u0000Purpose\u0000This paper aims to investigate the determinants that contribute to the financial stability and banking sector of Palestinian banks listed on the Palestine Stock Exchange (PEX) by using yearly data for the years 2012–2022.\u0000\u0000\u0000Design/methodology/approach\u0000Pooled ordinary least squares (OLS) and two-stage least squares (2SLS) were used to identify the variables and factors affecting the financial stability and banking sector of Palestinian banks. The study’s data were collected from the banks listed on PEX and from the yearly reports posted on the Palestine Monetary Authority’s (PMA) webpage over the years from 2012–2022. According to this research’s analysis, SMEs loans and capital sufficiency have a statistically significant positive impact on the stability of Palestinian banks. Unobserved heterogeneity, simultaneity and dynamic endogeneity are taken into account when using the 2SLS regression approach to adjust for the study endogeneity factor.\u0000\u0000\u0000Findings\u0000The study’s findings show that some factors and determinants might have both good and negative effects on financial stability and banking sector. Loans to small and medium-sized businesses (SMEs) and enough capital are two characteristics that statistically have a major favourable impact on the stability of Palestinian banks since they help the banks withstand deficits. A further potential discovery relates to the favourable effects of financial inclusion (FI) and digital financial services (DFS) on the stability of banks.\u0000\u0000\u0000Research limitations/implications\u0000This research has faced some limitations, such as the lack of a defined index from the regulatory organizations, this research is based on information from bank annual accounts. It has mostly relied on self-developed or World Bank indexes. Furthermore, the research solely used information from the supply side (banks); demand-side data were not taken into consideration.\u0000\u0000\u0000Practical implications\u0000This paper has managerial implications for stability of banking sector. The Palestine Monetary Authority, as the central bank, must increase the percentage of bank loans directed to small and medium-sized companies and oblige bank management to adhere to adequate capital standards, which contributes to strengthening the Palestinian banking sector and increasing its profits. The study findings advise banks that are enjoying financial stability to speed up the pace of FI and DFSs because most of these reliable banks have relatively low FI ratios. PMA is responsible for preserving the stability of the financial system. PMA, decision makers and banks management must retain adequate liquidity in their institutions and raise client collateral expectations to raise credit conditions.\u0000\u0000\u0000Originality/value\u0000This paper adds some contributions to the literature. To adjust for discrepancies between various types of banks, the authors concentrate on conventional and Islamic banks, which enables us to use a homogenous data set as opposed to depending on dichoto","PeriodicalId":44814,"journal":{"name":"Journal of Financial Regulation and Compliance","volume":"42 1","pages":""},"PeriodicalIF":0.9,"publicationDate":"2023-12-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138943641","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Ethical governance and the board’s moderating role in Zakat avoidance effects on firm value in muslim nations","authors":"Ines Kateb, Khoula Ftouhi","doi":"10.1108/jfrc-03-2023-0034","DOIUrl":"https://doi.org/10.1108/jfrc-03-2023-0034","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This paper aims to examine the impact of Zakat avoidance on firm value and investigates how board characteristics moderate this relationship within the context of Saudi Arabia, a Muslim nation.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>Using panel data from 2009 to 2020, encompassing 78 nonfinancial firms listed on the Saudi Stock Exchange, this study constructs an enhanced measure of Zakat avoidance that integrates insights from tax avoidance research, Shariah principles and the regulations of the Zakat, Tax and Customs Authority. This research uses empirical techniques, including panel data regressions and interaction analysis to investigate how board characteristics may influence this relationship.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>Descriptive analysis reveals pervasive Zakat compliance, underscoring the effectiveness of Saudi Arabia’s robust Zakat system. Regression results indicate a positive association between Zakat payment and firm value. Remarkably, board characteristics exhibit no significant link to Zakat avoidance, emphasizing the potency of the Zakat system and religious adherence. However, the moderation analysis reveals that board independence and meeting frequency positively moderate the relationship between Zakat avoidance and firm value.</p><!--/ Abstract__block -->\u0000<h3>Practical implications</h3>\u0000<p>The study emphasizes the vital importance of upholding Zakat obligations to cultivate trust among stakeholders and amplify firm value. It advocates for governance frameworks that foster vigilant oversight and independence, ultimately enhancing a firm’s overall worth. Furthermore, the study’s findings provide valuable insights for corporate leaders, investors, policymakers and society as a whole, facilitating the promotion of ethical financial conduct and driving holistic economic development.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This research introduces novel insights by scrutinizing the intricate interplay of Zakat avoidance, board dynamics and firm value within the context of a culturally distinctive emerging economy. The development of a distinct Zakat avoidance metric, along with comprehensive empirical assessment, contributes to the originality of the study. Moreover, the investigation into the moderating influence of board characteristics adds value to the existing body of knowledge.</p><!--/ Abstract__block -->","PeriodicalId":44814,"journal":{"name":"Journal of Financial Regulation and Compliance","volume":"5 1","pages":""},"PeriodicalIF":0.9,"publicationDate":"2023-12-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138717606","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Dark side of decentralised finance: a call for enhanced AML regulation based on use cases of illicit activities","authors":"Vladlena Benson, Umut Turksen, Bogdan Adamyk","doi":"10.1108/jfrc-04-2023-0065","DOIUrl":"https://doi.org/10.1108/jfrc-04-2023-0065","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This paper aims to focus on the need for an enhanced anti-money laundering (AML) regulation for decentralised finance (DeFi) to protect the integrity of global financial systems against illicit activities. Research highlights the requirement for a robust regulatory strategy for the fast-paced DeFi evolvement.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>This study used doctrinal legal research by analysing legislation, which involved creating use cases to illustrate different aspects of potential illicit activities via the DeFi ecosystem. Various DeFi applications were assessed for the potential regulatory responses and outcomes.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>This paper offers valuable insight into the regulatory challenges presented by DeFi. This study addresses the blind spots leveraged by criminals afforded by the DeFi’s decentralised nature. This paper offers a comprehensive examination of DeFi regulatory challenges based on use-case scenarios and provides recommendations for regulators on how to address them effectively.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This paper proposes measures for regulatory authorities to minimise money laundering risks through new channels such as decentralised exchanges, non-custodial wallets and cross-chain bridges. This study concludes with the future directions for DeFi regulation and AML compliance.</p><!--/ Abstract__block -->","PeriodicalId":44814,"journal":{"name":"Journal of Financial Regulation and Compliance","volume":"20 1","pages":""},"PeriodicalIF":0.9,"publicationDate":"2023-12-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138546214","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The role of inside debt in banks’ M&A choices: wealth expropriation or conflict resolution?","authors":"Ziyun Yang, Lanyi Yan Zhang, Claire J. Yan","doi":"10.1108/jfrc-05-2023-0070","DOIUrl":"https://doi.org/10.1108/jfrc-05-2023-0070","url":null,"abstract":"&lt;h3&gt;Purpose&lt;/h3&gt;\u0000&lt;p&gt;This study investigates the impact of bank CEOs’ inside debt on shareholder benefits in the context of bank mergers and acquisitions (M&amp;A) before the 2008–2009 financial crisis.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Design/methodology/approach&lt;/h3&gt;\u0000&lt;p&gt;Employing an event-study methodology, this analysis delves into market reactions to bank M&amp;A announcements during 2006–2007, encompassing 105 M&amp;As by 79 public commercial banks. This era witnessed heightened risk-taking behavior on the verge of the financial crisis. We explore the relation between relative inside debt and market abnormal returns at M&amp;A announcements and the association between relative inside debt and cash payment preferences in M&amp;As.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Findings&lt;/h3&gt;\u0000&lt;p&gt;Evidence suggests that M&amp;A announcements from banks where acquiring CEOs hold a substantial inside debt experience favorable stock market reaction, particularly for smaller banks. Additionally, banks with elevated CEO inside debt tend to favor cash as a payment mode for M&amp;As.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Research limitations/implications&lt;/h3&gt;\u0000&lt;p&gt;One limitation of this study is the short period of data availability. The data used in this study covers only 2006 and 2007, the periods marked by notable risk-taking activities on the verge of the financial crisis. Although this period is perfectly suitable for our investigation, given the prevalence of conflicts between equity and debt holders, it is essential to acknowledge that our findings may not capture changes or trends over time. Nevertheless, the results offer valuable insights into the factors that influence the behavior of the studied population. Future research could employ a longitudinal design to address this limitation and gain a more comprehensive understanding of the dynamics over extended periods.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Practical implications&lt;/h3&gt;\u0000&lt;p&gt;Our study has significant implications for businesses and policymakers as it provides insights into the factors contributing to financial crises and how compensation mechanisms can be used to moderate bank risk-taking. We propose that CEO inside debt compensation presents a plausible mechanism that boards of directors can incorporate into bank executive compensation contracts. By doing so, they can promote value-enhancing investments and moderate excessive risk-taking, thereby safeguarding the financial stability of individual banks and overall financial system.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Originality/value&lt;/h3&gt;\u0000&lt;p&gt;Our study sheds light on the beneficial role of bank CEO inside debt for shareholders, contributing empirical backing to the conflict resolution viewpoint in the discourse on wealth appropriation. From a regulatory stance, our findings advocate for the inclusion of bank CEO inside debt in executive remuneration agreements. Such a strategy can empower boards of directors to mitigate undue risk and enhance shareholder value in","PeriodicalId":44814,"journal":{"name":"Journal of Financial Regulation and Compliance","volume":"10 1","pages":""},"PeriodicalIF":0.9,"publicationDate":"2023-11-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138517240","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Economic policy uncertainty and Indian banking stability: the mediating role of regulation and supervision","authors":"Aamir Aijaz Syed","doi":"10.1108/jfrc-03-2023-0038","DOIUrl":"https://doi.org/10.1108/jfrc-03-2023-0038","url":null,"abstract":"Purpose The purpose of this study is to explore how the unprecedented rise in the economic policy uncertainty influence Indian banking sector stability. The unprecedented rise in the economic policy uncertainty during the recent pandemic has garnered the attention of policymakers to investigate its consequences on different sectors of the economy. Design/methodology/approach In this quest, the present study uses system generalized method of moments and other econometric tools to examine the influence of economic policy uncertainty on the Indian banking sector, covering the time frame from 2000 to 2022. In addition, the current study also investigates the mediating role of regulation and supervision in the nexus of economic policy uncertainty and the Indian banking sector stability. Findings The empirical outcome reveals that economic policy uncertainty negatively influences banking stability. However, when economic policy uncertainty interacts with stringent banking regulations, private monitoring and supervisions, it assists in diversifying the negative impact of economic policy uncertainty on the Indian banking sector stability. Originality/value To the best of the author’s knowledge, the study is an original work and provides robust estimates that will assist policymakers in understanding the influence of policy uncertainty on the banking stability. Moreover, the study also helps in understanding the role of supervision and regulation in mitigating the negative consequences of policy uncertainty on the banking stability.","PeriodicalId":44814,"journal":{"name":"Journal of Financial Regulation and Compliance","volume":"21 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135666845","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Methods of regulatory impact assessment: critical analysis and alternative method","authors":"Driss El Kadiri Boutchich","doi":"10.1108/jfrc-04-2023-0061","DOIUrl":"https://doi.org/10.1108/jfrc-04-2023-0061","url":null,"abstract":"\u0000Purpose\u0000This study aims to carry out a critical analysis of the methods used to deal with the regulatory impact assessment while proposing an alternative method to overcome some of the drawbacks of the aforementioned methods.\u0000\u0000\u0000Design/methodology/approach\u0000To achieve the objective of this work, the methods currently used in regulatory impact analysis are presented by highlighting their scope and the problems they may pose during their applications. After that, the adjusted variant of radial measure is suggested as an alternative method to the aforementioned methods while showing its relevance with regard to other methods using pertinent criteria. Finally, for concretization, a case study related to the sanctions against Russia after its invasion of Ukraine is presented.\u0000\u0000\u0000Findings\u0000The findings show that regulations related to the sanctions against Russia are good enough, with a score of 0.846. However, this score is less good in several countries like Germany (0.671), Italy (0.677) and France (0.745) and in the poorest countries.\u0000\u0000\u0000Originality/value\u0000The originality of this work resides in using a novel method in the regulatory impact analysis field, which is adjusted variant of radial measure. This method increases the effectiveness of the regulatory impact assessment.\u0000","PeriodicalId":44814,"journal":{"name":"Journal of Financial Regulation and Compliance","volume":" ","pages":""},"PeriodicalIF":0.9,"publicationDate":"2023-09-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47339573","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Bank crisis resolution in India","authors":"Soumik Bhusan, Ajit Dayanandan, N. Gopal","doi":"10.1108/jfrc-02-2023-0019","DOIUrl":"https://doi.org/10.1108/jfrc-02-2023-0019","url":null,"abstract":"\u0000Purpose\u0000The academic literature has examined why bank runs happen based on the work of 2022 Nobel Prize-winning economists Diamond and Dybvig. They have found the source of banking/financial crisis in terms of mismatch between liabilities (deposits being short term and savers wanting to short-term access to their money) and assets (long term and illiquid). The Lakshmi Vilas Bank (LVB) crisis intensified when it came under Prompt Corrective Action (PCA) of the Reserve Bank of India (RBI). This situation provides the opportunity to study whether the elements embodied in the theoretical models like Diamond and Dybvig hold true for LVB crisis. This study aims to examine the reasons for the demise of LVB in India using DuPont financial model, peer group analysis and time series structural break in crucial financial parameters.\u0000\u0000\u0000Design/methodology/approach\u0000The study examines the reason for insolvency of LVB using financial ratios, financial models (DuPont), financial distress model (Z-score) and asset-liability management. The study also adopts univariate structural break models using quarterly financial data covering the key financial measures used in the RBI’s PCA framework.\u0000\u0000\u0000Findings\u0000LVB crisis is like Diamond–Dybvig model, in the sense, savers requiring short-term access to their money (liquidity for their deposits) on the information of high non-performing assets, which further deteriorates the illiquid nature of loan portfolio (assets) of banks. The study finds its profit margin (net interest margin and non-interest margin) and managerial efficiency had started deteriorating since 2018. The study finds that LVB’s main weakness lies in its limited credit appraisal ability, its monitoring and weak internal controls. Lending to sensitive sectors (like real estate, capital markets and commodities) and exposure to large business groups also contributed to its weakness. The study also finds huge, elevated asset-liability mismatch, especially in the short-term maturity buckets. Using univariate econometric time series model, the study also confirms financial weakness being evident much earlier than the time when resolution was undertaken by the RBI through PCA.\u0000\u0000\u0000Research limitations/implications\u0000The study has implications for analysing and monitoring financial distress of banks. The study also has implications for devising banking regulation and supervision.\u0000\u0000\u0000Originality/value\u0000The study brings in a perspective of the banking regulations using the application of PCA framework on a listed private sector bank. The authors combine an accounting ratio model and combine risk measures that could identify the incipient risks in a bank. The authors believe this will help in refinement of banking regulations and better monitoring mechanisms.\u0000","PeriodicalId":44814,"journal":{"name":"Journal of Financial Regulation and Compliance","volume":" ","pages":""},"PeriodicalIF":0.9,"publicationDate":"2023-08-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44021843","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Societal trust and bank opacity","authors":"George Kladakis, Sotirios K. Bellos, Alexandros Skouralis","doi":"10.1108/jfrc-05-2023-0073","DOIUrl":"https://doi.org/10.1108/jfrc-05-2023-0073","url":null,"abstract":"\u0000Purpose\u0000This paper aims to examine the relationship between societal trust and bank asset opacity using an international sample of banks.\u0000\u0000\u0000Design/methodology/approach\u0000The authors use an international data set of banks and panel regressions. For robustness purposes, the authors use multiple measures of both societal trust and bank opacity as well as two-stage least squares regressions to address endogeneity concerns.\u0000\u0000\u0000Findings\u0000The authors find that societal trust is negatively associated with the opacity of bank portfolios.\u0000\u0000\u0000Practical implications\u0000Results of this study inform regulators on the importance of trust for the banking sector and support policies towards enhancing trust in banks. Also, a sustained environment of high levels of trust in banks can prevent the introduction of extensive prudential regulations that policymakers often use to establish trust, as well as lower the additional resources required when trust levels are low.\u0000\u0000\u0000Originality/value\u0000To the best of the authors’ knowledge, this is the first study that examines this relationship. The literature provides only limited evidence and not for the banking sector, for which opacity is of outmost importance.\u0000","PeriodicalId":44814,"journal":{"name":"Journal of Financial Regulation and Compliance","volume":" ","pages":""},"PeriodicalIF":0.9,"publicationDate":"2023-08-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49120225","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}