Author(s): Rym Ayadi, Sami Ben Naceur, Barbara Casu, Barry Quinn
Subject: Basel compliance and bank performance
Date published: December 23, 2015

An academic paper previously published in IMF Working Paper on Basel compliance and bank performance, was accepted for publication in the Journal of Financial Stability.

The global financial crisis underscored the importance of regulation and supervision to a well-functioning banking system that efficiently channels financial resources into investment. In this paper, IRCCF Director Rym Ayadi, Barry Quinn and members of the IRCCF Scientific Board Sami Ben Naceur and Barbara Casu, contributed to the ongoing policy debate by assessing whether compliance with international regulatory standards and protocols enhance bank operating efficiency. The paper focuses specifically on the adoption of international capital standards and the Basel Core Principles for Effective Bank Supervision (BCP). The relationship between bank efficiency and regulatory compliance is investigated using the (Simar and Wilson 2007) double bootstrapping approach on an international sample of publicly listed banks. The results indicate that overall BCP compliance, or indeed compliance with any of its individual chapters, has no association with bank efficiency.

Read the article on the ScienceDirect website