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Corporate governance, opaque bank activities, and risk/return efficiency: pre- and post-crisis evidence from Turkey

Olivier De Jonghe (UGent), Mustafa Disli (UGent) and Koen Schoors (UGent)
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Abstract
Does better corporate governance unambiguously improve the risk/return efficiency of banks? Or does either a re-orientation of banks' revenue mix towards more opaque products, an economic downturn, or tighter supervision create off-setting or reinforcing effects? The authors relate bank efficiency to shortfalls from a stochastic risk/return frontier. They analyze how internal governance mechanisms (CEO duality, board experience, political connections, and education profile) and external governance mechanisms (discipline exerted by shareholders, depositors, or skilled employees) determine efficiency in a sample of Turkish banks. The 2000 financial crisis was a wake-up call for bank efficiency and corporate governance. As a result, better corporate governance mechanisms have been able to improve risk/return efficiency when the economic, regulatory, and supervisory environments are more stable and bank products are more complex.
Keywords
DEPOSIT-INSURANCE, RISK-TAKING, POLITICAL CONNECTIONS, CAPITAL REGULATION, EQUITY PRICES, PERFORMANCE, DIVERSIFICATION, DETERMINANTS, OWNERSHIP, DIRECTORS, Corporate governance, Bank risk, Noninterest income, Crisis, Frontier

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Chicago
De Jonghe, Olivier, Mustafa Disli, and Koen Schoors. 2012. “Corporate Governance, Opaque Bank Activities, and Risk/return Efficiency: Pre- and Post-crisis Evidence from Turkey.” Journal of Financial Services Research 41 (1-2): 51–80.
APA
De Jonghe, O., Disli, M., & Schoors, K. (2012). Corporate governance, opaque bank activities, and risk/return efficiency: pre- and post-crisis evidence from Turkey. JOURNAL OF FINANCIAL SERVICES RESEARCH, 41(1-2), 51–80.
Vancouver
1.
De Jonghe O, Disli M, Schoors K. Corporate governance, opaque bank activities, and risk/return efficiency: pre- and post-crisis evidence from Turkey. JOURNAL OF FINANCIAL SERVICES RESEARCH. 2012;41(1-2):51–80.
MLA
De Jonghe, Olivier, Mustafa Disli, and Koen Schoors. “Corporate Governance, Opaque Bank Activities, and Risk/return Efficiency: Pre- and Post-crisis Evidence from Turkey.” JOURNAL OF FINANCIAL SERVICES RESEARCH 41.1-2 (2012): 51–80. Print.
@article{3060568,
  abstract     = {Does better corporate governance unambiguously improve the risk/return efficiency of banks? Or does either a re-orientation of banks' revenue mix towards more opaque products, an economic downturn, or tighter supervision create off-setting or reinforcing effects? The authors relate bank efficiency to shortfalls from a stochastic risk/return frontier. They analyze how internal governance mechanisms (CEO duality, board experience, political connections, and education profile) and external governance mechanisms (discipline exerted by shareholders, depositors, or skilled employees) determine efficiency in a sample of Turkish banks. The 2000 financial crisis was a wake-up call for bank efficiency and corporate governance. As a result, better corporate governance mechanisms have been able to improve risk/return efficiency when the economic, regulatory, and supervisory environments are more stable and bank products are more complex.},
  author       = {De Jonghe, Olivier and Disli, Mustafa and Schoors, Koen},
  issn         = {0920-8550},
  journal      = {JOURNAL OF FINANCIAL SERVICES RESEARCH},
  keyword      = {DEPOSIT-INSURANCE,RISK-TAKING,POLITICAL CONNECTIONS,CAPITAL REGULATION,EQUITY PRICES,PERFORMANCE,DIVERSIFICATION,DETERMINANTS,OWNERSHIP,DIRECTORS,Corporate governance,Bank risk,Noninterest income,Crisis,Frontier},
  language     = {eng},
  number       = {1-2},
  pages        = {51--80},
  title        = {Corporate governance, opaque bank activities, and risk/return efficiency: pre- and post-crisis evidence from Turkey},
  url          = {http://dx.doi.org/10.1007/s10693-011-0115-x},
  volume       = {41},
  year         = {2012},
}

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