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Models of Accounting Disclosure by Banking Institutions

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  • Gaoqing Zhang

Abstract

In this monograph, I advocate and illustrate an emerging stream of accounting literature that deploys economic models to study issues of accounting disclosure by banking institutions. To motivate the focus on a specific industry (banking), I identify two banking specificities: first, banks are fragile to the risk of runs due to their economic roles in liquidity creation, and second, banks are heavily regulated due to a desire to protect uninformed and dispersed depositors. More importantly, I show that considering these banking specificities, accounting disclosure by banks can play a prominent role in influencing the stability and the efficiency of the banking system. I present workhorse models that can be adapted as building blocks to capture the roles of accounting disclosure in the banking industry. I also draw on recent studies to illustrate specific accounting applications of the workhorse models and discuss their potential to generate implications that inform policy debates and empirical tests.

Suggested Citation

  • Gaoqing Zhang, 2023. "Models of Accounting Disclosure by Banking Institutions," Foundations and Trends(R) in Accounting, now publishers, vol. 17(3-4), pages 173-300, May.
  • Handle: RePEc:now:fntacc:1400000071
    DOI: 10.1561/1400000071
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    References listed on IDEAS

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