Does being a responsible bank pay off? Evidence from the COVID-19 pandemic

Alper Kara, Steven Ongena and Yilmaz Yildiz
Additional contact information
Alper Kara: Brunel University London
Yilmaz Yildiz: University of Kent

No 23-80, Swiss Finance Institute Research Paper Series from Swiss Finance Institute

Abstract: We investigate whether banks’ initial responses during the first wave of the COVID-19 pandemic in supporting their customers, communities, and governments were perceived as value-enhancing by investors. Using a unique responsible banking measure for a sample of the largest US and European banks, we find a negative relationship between responsible bank behavior and stock market performance, particularly in the first wave of the pandemic. We also find that riskier banks were affected more negatively if they behaved responsibly. Overall, our findings show that banks’ responsible behavior during a crisis reduces, or at best is not relevant to, shareholder value.

Keywords: COVID-19 pandemic; market performance; responsible banking; stakeholder vs. shareholder value (search for similar items in EconPapers)
JEL-codes: G21 G32 M14 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2023-09
References: Add references at CitEc
Citations:

Downloads: (external link)
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4565590 (application/pdf)

Related works:
Journal Article: Does being a responsible bank pay off? Evidence from the COVID-19 pandemic (2024)
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:chf:rpseri:rp2380

Access Statistics for this paper

More papers in Swiss Finance Institute Research Paper Series from Swiss Finance Institute Contact information at EDIRC.
Bibliographic data for series maintained by Ridima Mittal ().