Basel Regulations and Banks’ Risk-efficiency Nexus

Evidence from Dynamic Simultaneous-equation Models

Bibliographic Data

ID21737411
AuthorsSalma Louati (0000-0002-1825-5672, University of Sfax, corresponding author), Younes Boujelbene (0000-0002-0012-8704, University of Sfax)
Year2021
Volume22
Issue4
Pages578-602
Publication date2021-10-02
Open AccessNo
TypeARTICLE
VenueJournal of African Business (JOURNAL)
Journal identifiersISSN: 1522-8916 • E-ISSN: 1522-9076
PublisherInforma UK Limited (PUBLISHER • GB)
DOI10.1080/15228916.2020.1770041
OpenAlexW3034183708
LanguageEN
References cited99

This study is designed to investigate the causality links binding the risk and efficiency factors within both of the Islamic and conventional banks contexts, highlighting the effect of regulatory standards and protocols. Relying on previously elaborated theoretical priors guidelines, a particular set of five regulatory tools has been considered, namely, capital requirement, official supervisory power, bank activities associated restrictions, deposit insurance and market discipline as well as private monitoring. Empirical results provide evidence that the same regulations appear to differently affect both of the distinct banking models. Overall, empirical investigations show that deposit insurance and market discipline stand as the unique regulatory instructional frameworks likely to help in reducing the risk-taking behavior of both of the Islamic and conventional banking systems, while different results have been attained in regard of the for bank efficiency dimension

Actuarial science · Bank regulation · Basel II · Basel III · Business · Capital requirement · Deposit insurance · Economics · Empirical evidence · Financial system · Incentive · Market discipline · Microeconomics · Operational risk · Risk management · Banking stability, regulation, efficiency · Computer Science · Islamic Finance and Banking Studies · Microfinance and Financial Inclusion · Finance

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