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Impact of risk oversight functions on bank risk: Evidence from the Dodd-Frank Act
Journal article   Open access   Peer reviewed

Impact of risk oversight functions on bank risk: Evidence from the Dodd-Frank Act

Lakshmi Balasubramanyan, Naveen D. Daniel, Joseph G. Haubrich and Lalitha Naveen
Journal of banking & finance, v 158, p107049
01 Jan 2024
DOI: https://doi.org/10.1016/j.jbankfin.2023.107049
url
https://doi.org/10.1016/j.jbankfin.2023.107049View
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Abstract

Business & Economics Business, Finance Economics Social Sciences
We document the impact of having a risk committee (RC) and a chief risk officer (CRO) on bank risk using the passage of the Dodd Frank Act as a natural experiment. The Act requires bank holding companies with over $10B of assets to have an RC to oversee risk management, while those with over $50B of assets are additionally required to have a CRO. We use difference-in-difference and regression discontinuity approaches to estimate the change in risk following RC and CRO adoption. Overall, we find no evidence that the RC or CRO have a causal impact on bank risk.

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Collaboration types
Domestic collaboration
Web of Science research areas
Business, Finance
Economics
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