Mujtaba, Ghulam ORCID: https://orcid.org/0000-0002-7317-4357 (2020) Effects of Basel equity and liquidity regulations on banking sector failure risk in emerging Asian economies. International Transaction Journal of Engineering, 11 (8). pp. 1-12.

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Abstract

We study the effect of Basel equity requirements and liquidity creation measures on banking sector failure risk in case of emerging Asian economies for 2004-2017 by using dynamic panel GMM methodology. This study results show that a rise in equity requirements is likely to decrease in failure risk (as the higher z-score implies the reduced failure risk). The finding suggests that by an incremental increase in equity ratio, liquidity creation results a rise in bank default risk. The finding is consistent with the argument that liquidity generation function exposes banking industry towards risk of illiquidity. The findings also suggest the positive relationship amid bank capital structure and z-score, which implies a surge of equity in bank capital structure is likely to reduce the failure risk.

Item Type:	Article
Status:	Published
DOI:	10.14456/ITJEMAST.2020.147
School/Department:	London Campus
URI:	https://ray.yorksj.ac.uk/id/eprint/10046

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