Growth and Earnings Persistence in Banking Firms: A Dynamic Panel Investigation

Choudhry Tanveer Shehzad, Jakob de Haan, Bert Scholtens and Jakob de Haan
Authors registered in the RePEc Author Service: Jakob de Haan

No 2772, CESifo Working Paper Series from CESifo

Abstract: This paper investigates (i) whether growth and profitability persist in banking firms, (ii) whether the level and volatility of growth and profitability are bank-size dependent, and (iii) the relationship between growth and profitability of a bank. Using a dynamic panel model estimated by GMM for a mixed sample of more than 1500 banks from 65 countries, we find no evidence of persistence in bank growth. However, our findings suggest significant persistence in bank profitability. Moreover, our results show that the growth and profitability dynamics of banks based in OECD countries differ from those of banks in non-OECD countries.

Keywords: bank size; bank earnings; earnings volatility; bank risk; Gibrat's law (search for similar items in EconPapers)
JEL-codes: G21 G32 L25 (search for similar items in EconPapers)
Date: 2009
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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