The Office of the Comptroller of the Currency (OCC) expects a bank to practice effective risk management regardless of whether the bank performs the activity internally or through a third party. A bank’s use of third parties does not diminish the responsibility of its board of directors and senior management to ensure that the activity is performed in a safe and sound manner and in compliance w...

This paper studies the relationship among corporate governance, risk taking and financial performance at bank holding companies’ (BHCs) during the financial crisis of 2008. While the paper did not find a significant relationship between corporate governance and risk-taking level, it shows that BHCs with lower risk performed better than BHCs with higher risk during the crisis. The results sugges...

in the information and communication era, management information systems play an undeniable role in organizations.  bank parsian is a iranian banking and financial services company, which has a network of 273 banking branch, known as the largest iranian private bank. this research examines the gaps in customer relationships systems in bank parsian based on characteristics of management informat...

Use of variability of profits and other accounting-based ratios in order to estimate a firm's risk of insolvency is a well-established concept in management and economics. This paper argues that these measures fail to approximate the true level of risk accurately because managers consider other strategic choices and goals when making risky decisions. Instead, we propose an econometric model tha...

Good corporation governance will facilitate commercial bank to make a scientific decision and operate in an intensivism way. Furthermore, the proper governance model will reduce the moral risk and the converse choice of the management. By comparing the typical governance models of different countries, we can find some principles and ways for our state-owned commercial bank to establish effectiv...

This paper models loan rate-setting behavior, taking into account the product pricing and performance of the borrowing firm, and also calculates the bank’s loan-risk sensitive equity values. The lending function creates the need to model bank equity as a capped call option, which captures the credit risk directly related to management of a firm’s operations. When the product price set by the bo...

James Harvey and Forest Myers are policy economists in the Division of Supervision and Risk Management of the Federal Reserve Bank of Kansas City. The views expressed in this article are those of the authors and do not necessarily reflect those of the Federal Reserve Bank of Kansas City or the Federal Reserve System.

In this paper we suggest a new approach to risk assessment for banks. Rather than looking at them individually we analyze risk at the level of the banking system. Such a perspective is necessary because the complicated network of mutual credit obligations can make the actual risk exposure of the entire system invisible at the level of individual institutions. We apply our framework to a cross s...