Diversification And The Banks Risk Return Characteristics Evidence From Loan Portfolios Of German Banks
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Diversification And The Banks Risk Return Characteristics
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Author : Andreas Behr
language : en
Publisher:
Release Date : 2016
Diversification And The Banks Risk Return Characteristics written by Andreas Behr and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2016 with categories.
Banks face a tradeoff between diversifying and focusing their loan portfolio. In this paper we carry out an empirical study for the German market to shed light on the question whether or not the benefits of risk sharing outweigh those of specialization. We use data from the Bundesbank's quarterly borrowers statistic to determine the degree of diversification in the banks' loan portfolios and combine this data with the banks' balance sheets and audit reports. The unique database comprises data from all German banks during the period from 1993 to 2003. Our main results can be summarized in three statements: i) Specialized banks have a slightly higher return than diversified banks. ii) Specialized banks have lower relative loan loss provisions and lower shares of non-performing loans, iii) However, the standard deviations of the loan loss provision ratio and the non-performing loan ratio are lower for diversified banks.
Diversification And The Banks Risk Return Characteristics Evidence From Loan Portfolios Of German Banks
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Author : Andreas Kamp
language : en
Publisher:
Release Date : 2007
Diversification And The Banks Risk Return Characteristics Evidence From Loan Portfolios Of German Banks written by Andreas Kamp and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2007 with categories.
Banks face a tradeoff between diversifying and focusing their loan portfolio. In this paper we carry out an empirical study for the German market to shed light on the question whether or not the benefits of risk sharing outweigh those of specialization. We use data from the Bundesbank's quarterly borrowers statistic to determine the degree of diversification in the banks' loan portfolios and combine this data with the banks' balance sheets and audit reports. The unique database comprises data from all German banks during the period from 1993 to 2003. Our main results can be summarized in three statements: i) Specialized banks have a slightly higher return than diversified banks. ii) Specialized banks have lower relative loan loss provisions and lower shares of non-performing loans. iii) However, the standard deviations of the loan loss provision ratio and the non-performing loan ratio are lower for diversified banks.
Does Diversification Improve The Performance Of German Banks
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Author : Evelyn Hayden
language : en
Publisher:
Release Date : 2006
Does Diversification Improve The Performance Of German Banks written by Evelyn Hayden and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2006 with Bank profits categories.
The Effects Of Focus And Diversification On Bank Risk And Return
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Author : Viral V. Acharya
language : en
Publisher:
Release Date : 2002
The Effects Of Focus And Diversification On Bank Risk And Return written by Viral V. Acharya and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2002 with Bank loans categories.
Should Banks Be Diversified
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Author : Viral V. Acharya
language : en
Publisher:
Release Date : 2002
Should Banks Be Diversified written by Viral V. Acharya and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2002 with Bank loans categories.
Does Diversification Improve The Performance Of German Banks Evidence From Individual Bank Loan Portfolios
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Author : Evelyn Hayden
language : en
Publisher:
Release Date : 2016
Does Diversification Improve The Performance Of German Banks Evidence From Individual Bank Loan Portfolios written by Evelyn Hayden and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2016 with categories.
Should banks be diversified or focused? Does diversification indeed lead to enhanced performance.
Diversification And The Banks Risk Return Characteristics Evidence From Loan Portfolios Of German Banks
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Author : Andreas Behr
language : en
Publisher:
Release Date : 2007
Diversification And The Banks Risk Return Characteristics Evidence From Loan Portfolios Of German Banks written by Andreas Behr and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2007 with categories.
Banks Concentration Versus Diversification In The Loan Portfolio
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Author : Nadya Jahn
language : en
Publisher:
Release Date : 2016
Banks Concentration Versus Diversification In The Loan Portfolio written by Nadya Jahn and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2016 with categories.
Using a unique data set on German banks' sector specific loan exposures to the real economy and the corresponding write-offs and write-downs, we examine the impact of loan portfolio sector concentration on credit risk. By controlling for common risk factors, we separate the bank-specific selection and monitoring abilities from the composition of the loan portfolio. In our empirical study for the period 2003-2011, we find that (a) banks which are specialized in certain industries have, on average, lower loan losses, (b) the loss rate of a given industry in a bank's loan portfolio is lower if the bank has major exposures to this industry, and (c) the standard deviation of the loan losses is lower in the case of more focused banks.
Concentration Risks In The Loan Portfolios Of The German Savings
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Author : Dominik Stephan
language : en
Publisher: GRIN Verlag
Release Date : 2008-07-08
Concentration Risks In The Loan Portfolios Of The German Savings written by Dominik Stephan and has been published by GRIN Verlag this book supported file pdf, txt, epub, kindle and other format this book has been release on 2008-07-08 with Business & Economics categories.
Seminar paper from the year 2008 in the subject Business economics - Banking, Stock Exchanges, Insurance, Accounting, grade: 2,7, University of Hohenheim, course: Risiko in der Ökonomischen Welt, language: English, abstract: 1 Introduction Risk Concentration in loan portfolios endanger the safeness of banks and reduce their profitability. Savings Banks and Credit Unions, as small banks which are specialized on geographic regions, are supposed to show high risk concentration in their loan portfolios and perform weakly. This paper will analyse the consequences of the “Regional Principle“ of the German Savings banks and Credit Unions on the risk concentration in their loan portfolios. One main subject is to show the positive and negative impacts of both strategies, specialization and diversification, on risk concentration, and to explain under which circumstances a bank should decide to specialize or to diversify. Furthermore possibilities will be presented to profit from both strategies thanks to credit risk tranfer by new financial products. The Regional Principle, its origin and and how it determines the strategy of Savings Banks and Credit Unions will be observed in the first part. Further I will explain why they can be considered as a homogenous group of banks. Within the second part will be presented the importance and the sources of concentration risks. Under which circumstances a Financial Institute should specialize or diversify, advantages and disadvantages and the trade off between both strategies will be presented in chapter three. As Savings Banks and Credit Unions would be better off within a regional diversification strategy, in chapter five will be presented the possibility of diversification under the use of derivatives and asset backed securities. Finally the paper will end with a conclusion considering results in wider context of Savings Banks and Credit Unions.
Banks Concentration Versus Diversification In The Loan Portfolio
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Author : Nadya Jahn
language : de
Publisher:
Release Date : 2013
Banks Concentration Versus Diversification In The Loan Portfolio written by Nadya Jahn and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2013 with categories.