Ownership and risk in deposit and development banks

Date
2021-09
Advisor
Önder, Zeynep
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Bilkent University
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English
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Thesis
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Abstract

This thesis studies the risk-taking behavior of banks, classified according to their ownership status and deposit collectability, operating in Turkey for the sample period 2004-2020. The aim of this thesis is to investigate whether the risk-taking behavior of development and investment banks in comparison to deposit banks, state-owned and foreign banks in comparison to privately-owned banks are different from each other while also taking the global financial crisis of 2008 and the expansion of the Credit Guarantee Fund (CGF) since 2017 into account. The risk-taking behavior of banks with respect to their counterparts is measured by four variables by the fixed-effects: the natural logarithm of the Z-score, loan loss provisions ratio, non-performing loans ratio and the volatility of return on assets. Bank-level control variables employed are bank size, total loans-to-total assets ratio, return on assets, the liquidity ratio, non-interest income ratio, growth in real total assets, the listing status of banks in the equities and debt securities market of Borsa Istanbul. The macroeconomic control variable employed is the growth in real Gross Domestic Product (GDP). The results of my thesis show that depending on the risk measure used, we get different empirical results.

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Bank risk-taking, Development and Investment banks, State-owned banks, Foreign banks, Turkey
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Published Version (Please cite this version)