Volume 14, Issue 1 (Winter 2019)                   J. Mon. Ec. 2019, 14(1): 85-100 | Back to browse issues page

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Akbarian S, Anvary Rostamy A A, Rezaei N, Abdi R. Corporate Governance and Credit Risk in the Iranian Banking Industry. J. Mon. Ec. 2019; 14 (1) :85-100
URL: http://jme.mbri.ac.ir/article-1-432-en.html
1- Department of Accounting, Bonab Branch, Islamic Azad University, Bonab, Iran
2- Department of Planning & Management, Tarbiat Modares University, Tehran, Iran
Abstract:   (1912 Views)
The primary purpose of this research is to investigate the impacts of corporate governance on credit risk in the Iranian banking industry. The sample consists of 20 banks listed on the Tehran Stock Exchange during 2011-2016, using panel data. In this research, credit risk and corporate governance are the dependent and independent variables, respectively. The meta-synthesis method was used for compiling a checklist of corporate governance indicators. Then, the content analysis method was applied for measuring the corporate governance index; i.e., the number of dimensions disclosed on the total number of disclosable dimensions. The results indicate that after adjusting the control variables namely the size, the financial leverage, the ratio of capital adequacy, the GDP and inflation, there is a significant negative relationship between corporate governance quality and the credit risk, which means more effective corporate governance will reduce information asymmetry, increases the clarity and stakeholder confidence, and finally reduces banks’ credit risk. Accordingly, the final recommendation is to reduce credit risk by improving the mechanisms of corporate governance in the Iranian banking industry.
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Type of Study: Original Research - Theoric | Subject: Monetary Economics
Received: 24 Jul 2019 | Accepted: 16 Oct 2019 | Published: 12 Nov 2019

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