The Performance of Japanese Banks in Relation to Safety Levels

Curtin Univ. Econ. & Finance Working Paper No. 2000-29

16 Pages Posted: 22 Aug 2001

See all articles by John L. Simpson

John L. Simpson

Curtin University - Centre for Research in Applied Economics

John P. Evans

Curtin University - Centre for Research in Applied Economics

Date Written: July 2000

Abstract

Japanenese banks over the past decade appear to have been more concerned with market penetration than with earnings and shareholder wealth maximisation.

This paper reports the results of an analysis of bank safety levels using a cross sectional sample of Japanese and European Banks compared in light of the unacceptably high reported levels of non-performing loans in the Japanese banking sector.

The results confirm that more attention should have been applied to balance sheet fundamentals in Japanese banking. It is conjectured that bank safety levels would have been higher and that the more prudent use of credit risk assessment and management would have avoided balance sheet problems.

Keywords: Japanese banks, European banks, bank safety levels, risk, balance sheet performance

JEL Classification: G15, G21

Suggested Citation

Simpson, John L. and Evans, John Philip, The Performance of Japanese Banks in Relation to Safety Levels (July 2000). Curtin Univ. Econ. & Finance Working Paper No. 2000-29, Available at SSRN: https://ssrn.com/abstract=280853 or http://dx.doi.org/10.2139/ssrn.280853

John L. Simpson

Curtin University - Centre for Research in Applied Economics ( email )

GPO Box U1987
Perth, Western Australia 6845
Australia

John Philip Evans (Contact Author)

Curtin University - Centre for Research in Applied Economics ( email )

GPO Box U1987
Perth, Western Australia 6845
Australia

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