IDEAS home Printed from https://ideas.repec.org/a/rom/conase/v6y2024i1p586-599.html
   My bibliography  Save this article

The Governance Profile of European Countries and Key Banking Indicators – A Causality Analysis

Author

Listed:
  • Iustina Alina BOITAN

    (Bucharest University of Economic Studies, Bucharest, Romania)

  • Wafaa SHABBAN

    (Bucharest University of Economic Studies, Bucharest, Romania)

Abstract

The study documents a significant relationship in terms of causality between country-level governance indicators (as a component of ESG) and main banking system indicators by relying on a sample of European Union countries that exhibit a temperate climate profile. Granger causality test is used to assess the link between banking system and country governance, in terms of a cause-effect framework. The findings show that the influence of country governance performance on banking activity is most pronounced in Belgium, Portugal, and Spain while in the Netherlands, France, Greece, and Italy the interplay is relatively balanced. Banking system indicators that appear to precede changes in governance ones in most countries are related to bank credit to bank deposits, bank deposits to GDP, and bank non-performing loans to gross loans. Bilateral causality is present mostly in Greece and Spain, the control of corruption and bank non-performing loans being the variables most often included in the causal link.

Suggested Citation

  • Iustina Alina BOITAN & Wafaa SHABBAN, 2024. "The Governance Profile of European Countries and Key Banking Indicators – A Causality Analysis," PROCEEDINGS OF THE INTERNATIONAL CONFERENCE ON ECONOMICS AND SOCIAL SCIENCES, Bucharest University of Economic Studies, Romania, vol. 6(1), pages 586-599, August.
    • Handle: RePEc:rom:conase:v:6:y:2024:i:1:p:586-599
    as

    Download full text from publisher

    File URL: https://www.icess.ase.ro/the-governance-profile-of-european-countries-and-key-banking-indicators-a-causality-analysis/
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    ESG; governance; banking system; causality analysis.;
    All these keywords.

    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rom:conase:v:6:y:2024:i:1:p:586-599. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Zamfir Andreea (email available below). General contact details of provider: https://edirc.repec.org/data/aseeero.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.