Bank management expertise and asset securitization policies

Tsung-Kang Chen, Hsien-Hsing Liao and Jing-Syuan Ye

Journal of Banking & Finance, 2019, vol. 109, issue C

Abstract: We explore how the expertise of a bank holding company's management team affects its asset securitization policies. We find management team members with an MBA degree and top management experience securitize more low risk loans while those with core functional executive positions securitize fewer high risk loans. In addition, internal liquidity, governance quality, and risk management quality moderate these effects. Moreover, risk management concerns are the main driver of the negative effect of the percentage of core functional executives on asset securitization. We also provide evidence that core functional executives deem securitized mortgage loans riskier after the subprime crisis.

Keywords: Asset securitization; Management team expertise; Bank holding companies; Internal liquidity; Risk management quality (search for similar items in EconPapers)
JEL-codes: G21 M12 M21 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbfina:v:109:y:2019:i:c:s0378426619302390

DOI: 10.1016/j.jbankfin.2019.105667

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