SOAS Research Online

A Free Database of the Latest Research by SOAS Academics and PhD Students

[skip to content]

Fosu, Samuel and Danso, Albert and Agyei-Boapeah, Henry and Ntim, Collins G. and Murinde, Victor (2018) 'How does banking market power affect bank opacity? Evidence from analysts' forecasts.' International Review of Financial Analysis, 60. pp. 38-52.

[img] Text - Accepted Version
Restricted to Repository staff only until 29 February 2020.
Available under License Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 (CC BY-NC-ND 4.0).

Request a copy

Abstract

Whilst the ongoing banking regulatory reforms towards a comprehensive Basel III framework emphasise bank transparency, disclosure and a competitive banking market environment, very little is known about the empirical relationship between bank opacity and banking competition. We investigate the impact of competition, as measured by the individual bank's pricing power in the banking market, on bank opacity using a large sample of US bank holding companies over the 1986–2015 period. We uncover new evidence, on the competition-bank opacity nexus, which suggests that banks with higher market power and operating in less competitive banking markets have lower analysts' forecast errors and dispersions and may thus be less opaque. This effect is more pronounced for the 2007–09 global financial crisis period. Our evidence is robust to controlling for analysts' characteristics, bank fixed-effects and endogeneity problems.

Item Type: Journal Article
Keywords: Bank opacity, Competition, Financial crisis, Disclosure and transparency, Basel III framework
SOAS Departments & Centres: Departments and Subunits > School of Finance & Management
ISSN: 10575219
DOI (Digital Object Identifier): https://doi.org/10.1016/j.irfa.2018.08.015
Date Deposited: 06 Sep 2018 08:50
URI: http://eprints.soas.ac.uk/id/eprint/26361

Altmetric Data

Statistics

Download activity - last 12 months
Downloads since deposit
1Download
48Hits
Accesses by country - last 12 months
Accesses by referrer - last 12 months

Repository staff only

Edit Item Edit Item