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Empirical Study on the Relationship between Efficiency, Capital and Risk into the Banking System of Romania

Author

Listed:
  • Alina MANTA

    (University of Craiova Faculty of Economics and Business Administration)

  • Roxana BADÎRCEA

    (University of Craiova Faculty of Economics and Business Administration)

Abstract

In this article, we study the relationship between the efficiency of the Romanian banks and the risk taken and also the banking capital. In our opinion, this analysis is important because it offers important findings regarding the influence of risk on banking profitability and on banking efficiency. Moreover, over the analyzed period the risks faced by banks increased significantly. Therefore, it is important to know exactly the relationship between efficiency, capital and risk in order to better understand the behavior of bank management.

Suggested Citation

  • Alina MANTA & Roxana BADÎRCEA, 2015. "Empirical Study on the Relationship between Efficiency, Capital and Risk into the Banking System of Romania," Finante - provocarile viitorului (Finance - Challenges of the Future), University of Craiova, Faculty of Economics and Business Administration, vol. 1(17), pages 58-67, December.
  • Handle: RePEc:aio:fpvfcf:v:1:y:2015:i:17:p:58-67
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    File URL: http://feaa.ucv.ro/FPV/017-006.pdf
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    References listed on IDEAS

    as
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    4. Joseph P. Hughes & Loretta J. Mester, 1998. "Bank Capitalization And Cost: Evidence Of Scale Economies In Risk Management And Signaling," The Review of Economics and Statistics, MIT Press, vol. 80(2), pages 314-325, May.
    5. Freixas, Xavier & Gabillon, Emmanuelle, 1999. "Optimal Regulation of a Fully Insured Deposit Banking System," Journal of Regulatory Economics, Springer, vol. 16(2), pages 111-134, September.
    6. Mayne, Lucille S, 1972. "Supervisory Influence on Bank Capital," Journal of Finance, American Finance Association, vol. 27(3), pages 637-651, June.
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    8. Alina Georgiana Manta & Roxana Maria Badîrcea, 2014. "Measuring The Efficiency In The Romanian Banking System Through The Method Of The Data Envelopment Analysis (Dea)," Annals of University of Craiova - Economic Sciences Series, University of Craiova, Faculty of Economics and Business Administration, vol. 1(42), pages 23-34.
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    More about this item

    Keywords

    banking profitability; banking risk; crisis;

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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