publication . Preprint . Article . 2009

Bank Activity and Funding Strategies : The Impact on Risk and Returns

Demirguc-Kunt, Asli; Huizinga, Harry;
Open Access English
  • Published: 01 Feb 2009
Abstract
This paper examines the implications of bank activity and short-term funding strategies for bank risk and returns using an international sample of 1,334 banks in 101 countries leading up to the 2007 financial crisis. Expansion into non-interest income generating activities such as trading increases the rate of return on assets, and it may offer some risk diversification benefits at very low levels. Non-deposit, wholesale funding, by contrast, lowers the rate of return on assets, although it can offer some risk reduction at commonly observed low levels of non-deposit funding. A sizeable proportion of banks, however, attract most of their short-term funding in the...
Subjects
mesheuropmc: health care economics and organizations
free text keywords: Other Depository Institutions, Brokerage, Venture Capital, Banks, Mortgages G210, Investment Banking, Banks&Banking Reform,Debt Markets,Emerging Markets,,Access to Finance, Micro Finance Institutions, Ratings and Ratings Agencies G240
Powered by OpenAIRE Open Research Graph
Any information missing or wrong?Report an Issue
publication . Preprint . Article . 2009

Bank Activity and Funding Strategies : The Impact on Risk and Returns

Demirguc-Kunt, Asli; Huizinga, Harry;