Risk management disclosures and banks financial performance: evidence from emerging markets

Javid Iqbal (), Muhammad Khalid Sohail (), Aymen Irshad () and Rao Aamir Khan ()
Additional contact information
Javid Iqbal: COMSATS University Islamabad
Muhammad Khalid Sohail: Bahria University
Aymen Irshad: COMSATS University Islamabad
Rao Aamir Khan: COMSATS University Islamabad

Risk Management, 2024, vol. 26, issue 1, No 5, 21 pages

Abstract: Abstract Risk management disclosures have attracted considerable attention after the financial crisis of 2007–2008. This study explores the relationship between risk management disclosures provided in annual reports and the bank’s current (future) performance. The sample consisted of 58 banks from several emerging markets covering the period of 2007 to 2020. The findings of the study provide strong evidence that managers' negative sentiment in risk-related disclosures in annual reports is closely linked with banks' future performance. In addition, the study highlighted the significance of risk management disclosures required by the Bank for International Settlement (BIS, Bank for International Settlements. Basel Committee on Banking Supervision, 2015. http://www.bis.org/bcbs/publ/d309.pdf ) to reduce information asymmetry between the management and external stakeholders. Moreover, it provides regulators, auditors, and analysts with a new source of information that can help them identify banks at risk and take preventative measures to reduce the anticipated cost of failure to the government and its contagious impact on the country’s economy.

Keywords: Negative sentiment; Banks; Risk management disclosures; Performance prediction (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1057/s41283-023-00136-y Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:risman:v:26:y:2024:i:1:d:10.1057_s41283-023-00136-y

Ordering information: This journal article can be ordered from
https://www.palgrave.com/gp/journal/41283

DOI: 10.1057/s41283-023-00136-y

Access Statistics for this article

Risk Management is currently edited by Igor Loncarski

More articles in Risk Management from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().