Risk Spillover Effect of Internet Finance: Evidence from Chinese Securities Companies

Panagiotis E. Dimitropoulos

Chapter 11 in Banking Resilience:New Insights on Corporate Governance, Sustainability and Digital Innovation, 2024, pp 391-416 from World Scientific Publishing Co. Pte. Ltd.

Abstract: The financial crisis that erupted during 2007–2009 brought to light the fact that systemically important financial institutions (SIFIs) can transmit risk to other financial institutions through risk spillovers that continue to propagate and spread throughout the financial system. At the same time, several widely used risk measures still underestimate systemic risk and spillovers, which implies that standard measures of risk should be modified to measure risk exposures more efficiently. This chapter aims to discover the risk spillover effects of online finance, using a GARCH-CoVaR model for six representative Chinese securities firms. By comparing the risk spillover effects using %CoVaR, it was determined that the risk spillover of Internet finance to securities firms varies by firm type and firm size. In particular, the risk spillover from Internet finance to Internet brokerage firms was higher, while the risk spillover to traditional brokerage firms was lower, with larger brokerage firms having a higher risk spillover than smaller brokerage firms.

Keywords: Corporate Governance, Board Characteristics, Board Structure, Banking Institutions, Historical Literature Review, Financial Crisis, Bank Risk, CEO, Corporate Social Responsibility, CSR, Bank Efficiency, Board Governance, Board Size, Board Independence, Gender Diversity, Blau Index, Risk-adjusted Bank Performance, Tobin's Q, Return-on-Risk-Adjusted-Capital, Sharpe Ratio, Sortino Ratio, Board Diversity, Bank Risk, Bank Performance, Cost Efficiency, Bank Stability, Cultural Openness, Women Directors, Foreign Directors, Directors Educational Level, Islamic Banks, Board Diversity, Gender Diversity, Gender Quota, Emerging Economy, Bank Outcomes, Attendance, Board Effectiveness, Private Banks, Public Sector Banks, India, Corporate Social Responsibility, ESG, Sustainable Finance, Responsible Investing, Socially Responsible Banks, Risk Management, Stakeholder Engagement, Financial Stability, Sustainability, Firm Value, Climate Finance, Policy Uncertainty, Financial Stability, Climate Risk, Bibliometric Analysis, Financial Markets, Financial Assets, Asset Pricing, Capital Flows, Sustainability, Accruals, Earnings Management, Accounting Value, National Culture , Cultural Dimensions , Collective Intelligence , Secrecy, Intelligence Quotient, International Accounting, Covid-19, Pandemic, Impact, Risk, GCC Banks, GCC Islamic Banks, Conventional Banks, Profitability, Capitalization, Resilience, Asset-based Indicators, Bank, China, Density, Diversification, FinTech, Focus, Income-Based Indicators, Kernel, Quantile Regression, Big Data, Economic Capital, Emerging Markets, FinTech, GARCH-M (1; 1), GCC Financial Markets, Liquidity Risk, Reinforcement Machine Learning, Risk Management, Portfolio Management, Liquidity-Adjusted Value at Risk, Risk Metrics, Risk Spillover Effects, Internet Finance, GARCH Models, VaR Models, CoVaR Models, Securities Firms, COVID-19, Systemic Risks, China, Regulatory Reporting, Systemic Risk, Financial Stability, SupTech, RegTech, Financial Reporting, Algorithmic Data Standards, Blockchain, Financial Crisis, BCBS 239, Banks, Gulf Cooperation Council (GCC), Political Connections, Trade-Off Theory, Pecking Order Theory, Capital Structure, Risk, Profitability, Speed Of Adjustment, Generalized Method of Moments (GMM), Flash Crash, High Frequency Traders, Regulatory Framework, Algorithms, Algorithmic Trading (AT), Financial Market, Capital Market, (search for similar items in EconPapers)
JEL-codes: G21 G3 G34 (search for similar items in EconPapers)
Date: 2024
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