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Executive compensation and bank risk in China

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  • Qiubin Huang

Abstract

Executive compensation is an important mechanism of corporate governance for banks, but its effect on bank risk remains inconclusive. Based on a sample of banks listed in China, we uncover a significantly positive relationship between executive compensation and bank risk during the 2007–2018 period. The finding is robust to model specifications, the risk measures used, and the way to calculate executive compensation.

Suggested Citation

  • Qiubin Huang, 2023. "Executive compensation and bank risk in China," Economics and Business Letters, Oviedo University Press, vol. 12(1), pages 62-67.
    • Handle: RePEc:ove:journl:aid:18482
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    File URL: https://reunido.uniovi.es/index.php/EBL/article/view/18482
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    References listed on IDEAS

    as
    1. Shah, Syed Zulfiqar Ali & Akbar, Saeed & Liu, Jia & Liu, Ziyu & Cao, Sichen, 2017. "CEO compensation and banks’ risk-taking during pre and post financial crisis periods," Research in International Business and Finance, Elsevier, vol. 42(C), pages 1489-1503.
    2. Gande, Amar & Kalpathy, Swaminathan, 2017. "CEO compensation and risk-taking at financial firms: Evidence from U.S. federal loan assistance," Journal of Corporate Finance, Elsevier, vol. 47(C), pages 131-150.
    3. Qiubin Huang, 2023. "Ownership concentration and bank stability in China," Applied Economics Letters, Taylor & Francis Journals, vol. 30(15), pages 2108-2112, September.
    4. Bian, Wenlong & Deng, Chao, 2017. "Ownership dispersion and bank performance: Evidence from China," Finance Research Letters, Elsevier, vol. 22(C), pages 49-52.
    5. Agyenim Boateng & Vu Hong Thai Nguyen & Min Du & Frank O. Kwabi, 2022. "The impact of CEO compensation and excess reserves on bank risk-taking: the moderating role of monetary policy," Empirical Economics, Springer, vol. 62(4), pages 1575-1598, April.
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