WHAT IS THE RELATION BETWEEN NON-PERFORMING LOANS, CORPORATE GOVERNANCE, AND LENDING BEHAVIOR FACTORS?

Joe-Ming Lee ()
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Joe-Ming Lee: Department of Applied Economics, Fo Guang University, Add. No. 160, Linwei Rd., Jiaosi Shiang, Yilan County 26247, Taiwan, ROC

The Singapore Economic Review (SER), 2023, vol. 68, issue 05, 1637-1650

Abstract: This research highlights the special problems facing the corporate governance of financial intermediaries and combines this theoretical perspective with bank observations in order to offer policy recommendations for their industry. The standard agency theory defines the corporate governance problem in terms of how equity and debt holders influence managers to act in the best interests of those providers of capital to firms. The results show that the relationship between directors’ collateralized shares, loan concentration and a bank’s non-performing loans has a significant positive, indicating that bad corporate governance and loan concentration are important warning signs for banks.

Keywords: Loan concentration; non-performing loans; corporate governance; lending behavior (search for similar items in EconPapers)
JEL-codes: C23 D24 G21 (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1142/S0217590819500590

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