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Bank earnings volatility in the UK: Does size matter? A comparison between commercial and investment banks

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  • Moutsianas, Konstantinos A.
  • Kosmidou, Kyriaki

Abstract

During the global financial crisis, the issue of banks’ size and especially whether banks could be ‘too big to fail’ (TBTF) was raised. Our study focuses on the impact of size on bank earnings volatility in the UK, which is among the most open financial systems in the world. This study analyzes commercial and investment banks. For the model specification, we employ panel data to analyze the period from 2000 to 2012. Our analysis indicates a nonlinear relationship between the bank size and earnings volatility of commercial and investment banks.

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  • Moutsianas, Konstantinos A. & Kosmidou, Kyriaki, 2016. "Bank earnings volatility in the UK: Does size matter? A comparison between commercial and investment banks," Research in International Business and Finance, Elsevier, vol. 38(C), pages 137-150.
    • Handle: RePEc:eee:riibaf:v:38:y:2016:i:c:p:137-150
    DOI: 10.1016/j.ribaf.2016.03.013
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    More about this item

    Keywords

    Earnings volatility; Too-big-to fail; Financial crisis; Panel data;
    All these keywords.

    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
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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