TY - JOUR
T1 - Effects of ceo turnover in banks
T2 - evidence using exogenous turnovers in indian banks
AU - Sarkar, Arkodipta
AU - Subramanian, Krishnamurthy
AU - Tantri, Prasanna
N1 - Publisher Copyright:
Copyright © Michael G. Foster School of Business, University of Washington 2018.
PY - 2019/2/1
Y1 - 2019/2/1
N2 - We examine the effects of chief executive officer (CEO) turnover in banks. Incoming bank CEOs face problems of information asymmetry because banks' operations are opaque and bank risk can change dramatically in a short time. These CEOs may therefore change bank policies to manage their personal risks. Since CEO turnover is usually endogenous, we utilize a setting in which CEO turnover is based solely on retirement age and is thus exogenous to bank performance. Consistent with our thesis, incoming CEOs increase provisioning for future delinquencies and shrink lending. Bank stock prices decline following these changes. Politically motivated lending or ever-greening cannot explain our results.
AB - We examine the effects of chief executive officer (CEO) turnover in banks. Incoming bank CEOs face problems of information asymmetry because banks' operations are opaque and bank risk can change dramatically in a short time. These CEOs may therefore change bank policies to manage their personal risks. Since CEO turnover is usually endogenous, we utilize a setting in which CEO turnover is based solely on retirement age and is thus exogenous to bank performance. Consistent with our thesis, incoming CEOs increase provisioning for future delinquencies and shrink lending. Bank stock prices decline following these changes. Politically motivated lending or ever-greening cannot explain our results.
UR - https://www.webofscience.com/wos/woscc/full-record/WOS:000456594600006
UR - https://openalex.org/W3121706944
UR - https://www.scopus.com/pages/publications/85056186207
U2 - 10.1017/S002210901800056X
DO - 10.1017/S002210901800056X
M3 - Review article
SN - 0022-1090
VL - 54
SP - 183
EP - 214
JO - Journal of Financial and Quantitative Analysis
JF - Journal of Financial and Quantitative Analysis
IS - 1
ER -
