Can bank boards prevent misconduct?

Nguyen, Duc, Hagendorff, Jens ORCID: https://orcid.org/0000-0002-3567-7826 and Eshraghi, Arman ORCID: https://orcid.org/0000-0002-7406-1725 2016. Can bank boards prevent misconduct? Review of Finance 20 (1) , pp. 1-36. 10.1093/rof/rfv011

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Abstract

We study regulatory enforcement actions issued against US banks to show that both board monitoring and advising are effective in preventing misconduct by banks. While better monitoring by boards prevents all categories of misconduct, better advising prevents misconduct of a technical nature. Board monitoring increases the likelihood that misconduct is detected, increases the penalties imposed on the CEO, and alleviates shareholder wealth losses following the detection of misconduct by regulators. Our article offers novel insights on how to structure bank boards to prevent bank misconduct.

Item Type:	Article
Date Type:	Publication
Status:	Published
Schools:	Mathematics Business (Including Economics)
Subjects:	H Social Sciences > HF Commerce H Social Sciences > HG Finance
Publisher:	Oxford University Press
ISSN:	1572-3097
Date of First Compliant Deposit:	30 March 2016
Last Modified:	15 Nov 2024 18:05
URI:	https://orca.cardiff.ac.uk/id/eprint/76288

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