ORCID
Karolina Puławska: 0000-0001-5249-5170
Abstract
Policymakers introduce bank levies (BLs) to reduce the probability of crises. In this study, we evaluate the effects of the Hungarian and German BLs implemented in 2010 and 2011, respectively, on the banks’ risk-taking behavior. Our analysis compares two completely different BL designs. The German BL is designed to increase as banks’ total liabilities increase, while the Hungarian BL is assessed on total assets. The results unambiguously demonstrate that a BL on assets increases banks’ credit risk. The results of analyzing the influence that introducing BLs has had on the German banking sector demonstrate that BL on liabilities decreases banks’ credit risk. An improved understanding of the impact of regulation on the risky activity of EU banks is very important for a wide range of financial market participants, including borrowers, shareholders regulators and supervisors, especially during turbulent times caused by the COVID-19 pandemic and the Russian war in Ukraine.
Recommended Citation
Puławska, Karolina
(2024)
"Effect of introductionof German and Hungarian bank levieson banks’ risk-taking behavior,"
Journal of Banking and Financial Economics: Vol. 2023:
No.
19, Article 1.
DOI: 10.7172/2353-6845.jbfe.2023.1.1
Available at:
https://press.wz.uw.edu.pl/jbfe/vol2023/iss19/1
First Page
1
Last Page
25
Page Count
25
Received Date
20 October 2022
Revised Date
18 November 202
Accept Date
2 February 2023
Online Available Date
1 March 2023
DOI
10.7172/2353-6845.jbfe.2023.1.1
JEL Code
G010; G2; G28
Publisher
University of Warsaw