Bank Risk-taking in Connection with Interest Rates
| Authors | |
|---|---|
| Year of publication | 2016 |
| Type | Article in Proceedings |
| Conference | Proceedings of the 3rd International Multidisciplinary Scientific Conference Social Sciences & Arts SGEM 2016, Book 2, Volume 3 |
| MU Faculty or unit | |
| Citation | |
| Web | SGEM International Multidisciplinary Scientific Conferences on Social Sciences and Arts |
| Field | Economy |
| Keywords | interest rate; risk-taking; banking industry; non-performing loan; profitability |
| Description | The gradual decrease of interest rates is noticed from the beginning of 2000 to the present. It caused that the risk-taking appetite of banks increased and banks have softened their lending standards. We examine the impact of interest rates on bank risk-taking and on the profitability of banks in this paper. The research is applied on four biggest banks in the Czech Republic and their sister companies operating in a country where the whole group of financial institutions is established. We compare the results and answer following questions. Do low interest rates increase risk-taking appetite of banks in Czech Republic equally as of their sister companies? How Czech banks faces to low interest rates in connection with profitability comparing to their sister companies? |
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