Corporate board and default risk of financial firms

被引:14
作者
Garcia, C. Jose [1 ]
Herrero, Begona [1 ]
Morillas, Francisco [2 ]
机构
[1] Univ Valencia, Dept Corp Finance, Av Tarongers S-N, Valencia 46022, Spain
[2] Univ Valencia, Dept Appl Econ, Valencia, Spain
来源
ECONOMIC RESEARCH-EKONOMSKA ISTRAZIVANJA | 2022年 / 35卷 / 01期
关键词
Corporate board; default risk; distance to default; European banks; Merton model;
D O I
10.1080/1331677X.2021.1909490
中图分类号
F [经济];
学科分类号
02 ;
摘要
This paper analyses the impact of corporate board structure on default risk of European banking firms. We focus on four core aspects of boards that have been addressed in Directive 2013/36/EU to strengthen the corporate governance of banks: the size of boards, their independence, the participation of female directors and CEO duality. We employ panel data analysis to study the 109 European listed banks between 2002 and 2019. Default risk is estimated by Merton's (1974) distance to default. We take into account the presence of unobservable heterogeneity, simultaneity and dynamic endogeneity and estimate the model using the dynamic difference and dynamic system GMM methodologies. The results show that the size of the board influences banks' default risk. Furthermore, bank size, firm profitability and GDP also exert a considerable influence.
引用
收藏
页码:511 / 528
页数:18
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