The impact of regulations on compliance costs, risk-taking, and the reporting quality of the EU banks

Date

2019-12-14

Supervisor/s

Journal Title

Journal ISSN

Volume Title

Publisher

Elsevier

Department

Type

Article

ISSN

1057-5219

Format

Citation

Poshakwale S, Aghanya D, Agarwal V. (2019) The impact of regulations on compliance costs, risk-taking, and the reporting quality of the EU banks. International Review of Financial Analysis, Volume 68, March 2020, Article number 101431

Abstract

The paper examines how the Statutory Audit and Corporate Reporting Directives (SACORD) affect the compliance costs, risk taking and quality of financial reporting of the EU banks. Using a natural experiment, we find that post SACORD, both compliance costs and risk taking increase significantly. However, the implementation of additional regulations seems to be effective in terms of improved quality of financial reporting. When we analyse the impact by size, we find that smaller banks face disproportionately higher increase in compliance costs while larger banks seem to engage in greater risk taking.

Description

Software Description

Software Language

Github

Keywords

Financial regulation, Transparency, Financial system, Financial stability, Difference-in-differences

DOI

Rights

Attribution-NonCommercial-NoDerivatives 4.0 International

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