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Monetary Policy Interest Rates and Bank Risk return Tradeoff: How Does Bank Competition Moderate this Relationship?

Japan Huynh

Bulletin of Monetary Economics and Banking2025https://doi.org/10.59091/2460-9196.2011article
ABDC C
Weight
0.37

What the paper says

This study empirically examines the moderating effect of bank competition on the link between monetary policy interest rates and bank risk-return dynamics in Vietnam from 2007 to 2019. The findings suggest that during monetary expansion, marked by decreasing interest rates, banks typically employ a more conservative strategy regarding their credit portfolios, thereby minimizing risk exposure. Nonetheless, this risk avoidance incurs reduced interest margins, decreased overall profitability, and compromised stability. Furthermore, the research utilizing both traditional and funding-adjusted Lerner indices indicates that increased market concentration, or diminished bank competitiveness, mitigates the impact of monetary policy interest rates on the trade-off between bank risk and return.

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https://doi.org/https://doi.org/10.59091/2460-9196.2011

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@article{japan2025,
  title        = {{Monetary Policy Interest Rates and Bank Risk return Tradeoff: How Does Bank Competition Moderate this Relationship?}},
  author       = {Japan Huynh},
  journal      = {Bulletin of Monetary Economics and Banking},
  year         = {2025},
  doi          = {https://doi.org/https://doi.org/10.59091/2460-9196.2011},
}

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Evidence weight

0.37

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.16 × 0.4 = 0.06
M · momentum0.53 × 0.15 = 0.08
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.