THE IMPACT OF BANKS SIZE ON BANKS SYSTEMIC RISK – EVIDENCE FROM MENA | ||
| المجلة العلمية للدراسات التجارية والبيئية | ||
| Volume 16, Issue 2, April 2025, Pages 2116-2153 PDF (943.59 K) | ||
| Document Type: المقالة الأصلية | ||
| DOI: 10.21608/jces.2025.436610 | ||
| Authors | ||
| Nancy Youssef* 1; Walid Ibrahim* 2; Yousri Khlefa* 2 | ||
| 1DBA Candidate | ||
| 2Department of Business Administration, Faculty of Commerce, Cairo University | ||
| Abstract | ||
| Purpose – This paper examines the: impact of banks size (BS) on Banks’ Systemic Risk (BSR), with a specific emphasis on banking distress, in MENA over the period of 2008-2018 shedding light on vital regulatory measures to be undertaken by regulatory entities and imposed on banks for better risk containment in the banking sector. Design/methodology/approach – The researchers use a population of MENA region’s listed banks. A convenience sample of all available online data, where Bank Specific Variables (BSV) data are obtained from Eikon online database, and Country Specific Variables (CSV) data are obtained from the World Development Indicators (WDI) database at the World Bank and World Bank Doing Business database. Independent BSV: Banks Size (lnNI). Control BSV: Equity Ratio, Regulatory Ratio (CAR), Loans Ratio, Loan Loss Provision, Net Loans Growth, Total Assets Growth, Return on Equity (ROE), and Liquid Assets Ratio. Control CSV: GDP Per Capita, Inflation Rate, and Depth of Information Sharing. Limitations/Results – Limitations: Depending on secondary data sources, and data availability restrictions, where the researchers are confined to the listed and unlisted banks financial statements, which in-turn limits the sample size considerably. Results: BS has a negative effect on BSR; reflecting that larger banks may have lower banks systemic risk due to the “bailout effect” having more stringent regulations imposed on them by the regulatory entities supporting bailout. Credit Risk has a positive impact on BSR; the higher the bank’s credit risk the higher its BSR, the lower its asset quality. Research Importance – The consistent development of MENA’s financial sector in terms of both market and financial institutions size constitute a gap in the academic literature where MENA’s banks systemic risk is understudied. This in turn can help in the evaluation of policy reform proposals that followed the 2008 global financial crisis (GFC) as well as the ones that will follow the current global economic crisis. | ||
| Keywords | ||
| Systemic Risk; Banks Size; Financial Distress; CAMEL | ||
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