Colombian paper paints nuanced picture of bank risk and efficiency link

central-bank-of-colombia
The Central Bank of Colombia

Banks may be more efficient if they are better capitalised, but the effects differ depending on the bank's characteristics, research published by the Central Bank of Colombia on July 9 finds.

The influence of risk-taking on bank efficiency, by Miguel Sarmiento and Jorge Galán, builds its analysis around a "stochastic frontier model", which helps capture unobserved heterogeneity, the authors say.

In line with other research, they find banks with higher credit risk exposures tend to have lower

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact [email protected] or view our subscription options here: http://subscriptions.centralbanking.com/subscribe

You are currently unable to copy this content. Please contact [email protected] to find out more.

To continue reading...

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: