| Title: |
Loan loss provisions and macroeconomic shocks: some empirical evidence for Italian banks during the crisis |
| Authors: |
Caporale, GM; Alessi, M; Di Colli, S; Lopez, JS |
| Publication Year: |
2017 |
| Collection: |
Brunel University London: Brunel University Research Archive (BURA) |
| Subject Terms: |
loan loss provision; bank lending; financial system cyclicality |
| Description: |
Supplementary materials are available online at: https://www.sciencedirect.com/science/article/pii/S1544612317303471?via%3Dihub#sec0006 . ; Copyright © 2017 The Authors. This paper uses data from a panel of more than 400 Italian banks for the period 2001 – 2015 to examine the main determinants of loan loss provision (LLP), which are classified as either discretionary (income smoothing, capital management, signalling) or non-discretionary (related to the business cycle). The possible effects of the double-dip recession of 2008-9 and 2011-15 are also examined. The results suggest that LLP in Italian banks is countercyclical, with non-discretionary components and macroeconomic shocks playing a significant role. Moreover, LLP is less cyclical in the case of local banks, since their loans are more collateralized and their behaviour is more strongly affected by supervisory activity. |
| Document Type: |
article in journal/newspaper |
| Language: |
unknown |
| Relation: |
Finance Research Letters; https://bura.brunel.ac.uk/handle/2438/15336; https://doi.org/10.1016/j.frl.2017.10.031 |
| DOI: |
10.1016/j.frl.2017.10.031 |
| Availability: |
https://bura.brunel.ac.uk/handle/2438/15336; https://doi.org/10.1016/j.frl.2017.10.031 |
| Rights: |
Copyright © 2017 The Authors. Published by Elsevier Inc. This is an open access article under the CC BY license (https://creativecommons.org/licenses/by/4.0/). ; https://creativecommons.org/licenses/by/4.0/ ; The Authors |
| Accession Number: |
edsbas.4E2B9D56 |
| Database: |
BASE |