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The performance and stability of financial institutions after digital transformation: The importance of regional policies

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  • Wu, Xiaowen
  • Cheng, Guangbin

Abstract

Competition among financial institutions is extremely fierce. How digital transformation can enhance banks’ competitiveness is a crucial question. In this study, we investigate the relationship between digital transformation and financial institution performance. Based on a sample of all commercial banks in China between 2010 and 2022, this study finds strong evidence that digital transformation improves bank performance. Furthermore, we find that this relationship is more pronounced when a region implements policies that encourage digitalization. Overall, this study contributes to the rapidly growing literature on enterprise digital transformation.

Suggested Citation

  • Wu, Xiaowen & Cheng, Guangbin, 2024. "The performance and stability of financial institutions after digital transformation: The importance of regional policies," Finance Research Letters, Elsevier, vol. 66(C).
    • Handle: RePEc:eee:finlet:v:66:y:2024:i:c:s1544612324007013
    DOI: 10.1016/j.frl.2024.105671
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    References listed on IDEAS

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