Full Article: PDF
Scientific Object Identifier: http://s-o-i.org/1.1/TAS-01-33-2
DOI: http://dx.doi.org/10.15863/TAS.2016.01.33.2
Language: English
Citation: Torabi R, Bozorgzadeh H (2016) A SURVEY OF THE IMPACT OF DIVERSIFICATION ON FINANCIAL STABILITY OF BANKS. ISJ Theoretical & Applied Science, 01 (33): 4-10. Soi: http://s-o-i.org/1.1/TAS-01-33-2 Doi: http://dx.doi.org/10.15863/TAS.2016.01.33.2 |
Pages: 4-10
Published: 30.01.2016
Abstract: Ownership structure in existing private banks in TSE can change diversification degree by changing management structure in market and by approving different rules of credit risk, can affect financial stability of bank. Despite the wide researches about the relationship between diversification degree and stability, most aspects of this relationship are not recognized due to various factors. Thus, investigation of the relationship between diversification degree and ownership structure and financial stability of banks listed on TSE is of great importance and this is one of the unknown aspects of this study. The study population of this research is existing banks in TSE during 2008-2014. The study method is descriptive-analytic and evaluation models and panel data are used. As the results of Hausman test and insignificance of statistics are used, random effects method is selected. F Limer’s test shows the support of panel data method. The present study is composed of two main regression, the first is performed by herfindahl hirschman index in payment of loan and second is performed by coefficient of concentration 3 of first bank in deposits. The results showed that the higher the concentration of payment of loan market and as payment loans are in specific minority, the delayed payment of bank and financial instability of banks are increased. This means that the higher the competition in loans payment, the higher the clarity, the lower the financial instability. Also, the results show that concentration among the banks and exclusion among the banks has negative effect on financial stability of banks. Also, the results show that the higher the banks exclusive ownership in stock market, and the higher the sum of shareholders above 5%, the lower the financial instabilities and delayed payment.
Key words: Diversification degree, Ownership structure, financial stability, Banks listed on TSE.
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