Bank risk-taking and corporate investment: Evidence from the Global Financial Crisis of 2007–2009
| Autor: | Meg Adachi-Sato, Chaiporn Vithessonthi |
|---|---|
| Rok vydání: | 2021 |
| Předmět: |
040101 forestry
Economics and Econometrics 050208 finance 05 social sciences Financial system Sample (statistics) 04 agricultural and veterinary sciences Investment (macroeconomics) Banking sector Bank credit Bank risk Loan Cash holdings 0502 economics and business Financial crisis 0401 agriculture forestry and fisheries Business Finance |
| Zdroj: | Global Finance Journal. 49:100573 |
| ISSN: | 1044-0283 |
| DOI: | 10.1016/j.gfj.2020.100573 |
| Popis: | In this paper, we explore the relation between the banking sector's risk-taking and a firm's investment (“corporate investment”). Specifically, we ask whether firms' cash holdings moderate the effect of the banking sector's risk-taking on corporate investment. Based on a panel sample of publicly listed non-financial firms in 15 EU countries during the period 1990–2015, we document several key findings. First, both cash holdings and the banking sector's risk-taking are positively associated with corporate investment. Second, bank loan growth, which roughly captures the supply of bank credit, is not related to corporate investment. Third, firms with smaller cash holdings disproportionately invest more than do firms with larger cash holdings during periods of higher risk-taking by the banking sector. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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