Publikacja:

How to Design a Bank Levy: The Effect of a Levy Scheme on Bank Performance and its Activities

Data

2022
Artykuł
Przeszukaj czasopismo Uproszczony widok Pełne metadane Statystyki
 
cris.legacyid7069
cris.virtual.journalance#PLACEHOLDER_PARENT_METADATA_VALUE#
cris.virtualsource.journalancedc92c553-0411-4522-97d5-b7ef33169392
dc.abstract.plPurpose: One of the regulatory responses to the 2008 financial crisis was to internalize the costs related to banks’ distress by introducing bank levies. More than 23 European banking sectors have been confronted with the new levy regime imposing the additional tax on banks’ balance sheet. Methodology: This study analyzes the effect of the levy introduction on banks’ profitability, credit activity, and on their business models. More importantly, we confront two different levy regimes – one imposed on banks’ assets and the other on liabilities – to assess their differential impact. A generalized least squares regression with a random effect is performed on a data sample of Hungarian and German credit institutions from 2005 to 2015. Results: The results show that levy introduction weakened banking sectors in terms of their profitability as well as their lending activity. Even though banks try to compensate for the cost of the levies by passing some of the costs on to the customers and restructuring their operations to limit the tax burden, we find that these activities are not sufficient to offset the whole tax burden. We also note that while the asset levy has a more severe effect on banks’ profits, the liability levy severely affects banks’ lending due to lower interest margin resulting from higher cost of funding. Findings: Our research results provide important conclusions for regulators, especially during turbulent periods such as the COVID-19 pandemic to strengthen the banking sectors by considering the levy suspension.
dc.contributor.affiliationKozminski University
dc.contributor.affiliationKozminski University
dc.contributor.authorAneta Hryckiewicz-Gontarczyk
dc.contributor.authorKarolina Puławska
dc.date.accessioned2025-07-25T16:03:16Z
dc.date.available2025-07-25T16:03:16Z
dc.date.issued2022
dc.date.published9/2022
dc.description.issue3
dc.description.physical136–174
dc.description.volume30
dc.identifier.doi10.7206/cemj.2658-0845.85
dc.identifier.issn2658-0845
dc.identifier.urihttps://repozytorium.kozminski.edu.pl/handle/item/1712
dc.languageen
dc.relation.ispartofCentral European Management Journal
dc.relation.pages136–174
dc.rightsCC-BY-4.0
dc.subjectbank levy
dc.subjectprofitability
dc.subjectlending
dc.subjectstability
dc.subjectregulations
dc.subjectCOVID-19
dc.subtypeOriginal
dc.title

How to Design a Bank Levy: The Effect of a Levy Scheme on Bank Performance and its Activities

dc.typeArticle
dspace.entity.typePublication