Survey the Relationship between Bank Size and Capital with Systemic Risk in Banks Accepted in the Stock Exchange

Document Type : Research Paper

Authors

1 Ph.D. student of Finance, Department of Financial Management, Central Tehran Branch , Islamic Azad University, Tehran, Iran,

2 Ph.D. student of Finance, Department of Financial Management, Central Tehran Branch , Islamic Azad University, Tehran, Iran.

3 Associate Professor, Department of Business Management, Central Tehran Branch , Islamic Azad University, Tehran, Iran.

Abstract

Due to the important functions in the financial system, banks are considered as important components of the financial system of each country. The subject of systemic risk is a new subject in the global financial literature and has accounted for most of empirical studies in recent years. If system risk, ignored, or in a way that is reasonable and consistent with regulatory rules, its equipment and its consequences will be irreversible and corrective. This research was conducted to explain the relationship between bank size and capital with systemic risk in banks accepted in the stock exchange. In this research, systemic risk of the banking sector has been considered as the most important part of the country's economy, and ΔCoVaR has been used to calculate the systemic risk severity. The statistical population of this research is the banks accepted in the Tehran Stock Exchange during the 7-year period from 2010 to 2016. The results of this research show that systemic risk increases with the size of the bank, and this risk increases in the bank with more capital, less capital and less capital.

Keywords

References

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History

  • Receive Date: 25 September 2017
  • Revise Date: 08 December 2018
  • Accept Date: 11 December 2018

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