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Risk Taking by Banks in the Transition Countries

Author

Listed:
  • Rainer Haselmann

    (University of Mainz, Jakob-Welder Weg 4, 55128 Mainz, Germany.)

  • Paul Wachtel

    (Stern School of Business, New York University, 44 West 4th Street, New York, NY 10012, USA.)

Abstract

Although the performance and privatisation of transition banks have been widely studied already, little is known about their risk-taking and risk management activities. We use a new European Bank for Reconstruction and Development (EBRD) survey data set of banks to examine risk taking by banks in the transition countries. We find no indication of excessive risk taking by specific ownership or size categories of banks. Also, we find no connections between risk taking and the quality of the institutional environment although an unsound environment is associated with higher levels of capital.

Suggested Citation

  • Rainer Haselmann & Paul Wachtel, 2007. "Risk Taking by Banks in the Transition Countries," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 49(3), pages 411-429, September.
    • Handle: RePEc:pal:compes:v:49:y:2007:i:3:p:411-429
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