CEO Overconfidence and Bank’s Asset Quality: The Role of Board Gender Diversity

Elkady, Maram; Elbannan, Mohamed; Abdel Ghaffar, Emad

doi:10.21608/ajccr.2024.226018.1074

|
|
|
How to cite
RIS EndNote BibTeX APA MLA Harvard Vancouver
|
Share

	CEO Overconfidence and Bank’s Asset Quality: The Role of Board Gender Diversity
Article 2, Volume 4, Issue 2, June 2024, Page 29-50 PDF (553.15 K)
Document Type: Original Article
DOI: 10.21608/ajccr.2024.226018.1074
View on SCiNiTO
Authors
Maram Elkady ; Mohamed Elbannan; Emad Abdel Ghaffar
Faculty of Commerce, Cairo University, Giza, Egypt
Abstract
Overconfidence has been extensively examined in the corporate environment, particularly in the context of financial markets. Despite this, little is known about its impact on the banking sector and how it constrains these biases. The literature on board gender diversity to date does not offer a consensus on how board gender diversity interacts with CEO overconfidence when considering credit risk. This research aims to fill a gap in the literature by examining the impact of CEO overconfidence on a bank’s asset quality and the moderating influence of board gender diversity on this association. The analysis depends on a cross-country sample of 66 listed European banks from 2014 Q1 to 2021 Q4. The findings show that CEO overconfidence has a significant negative impact on the bank’s asset quality. Furthermore, the results demonstrate that board gender diversity plays an important role in constraining the CEO overconfidence biases and improving the bank’s asset quality. The research implies that bank regulators must encourage sound governance practices that reduce excessive risk-taking while closely monitoring the cultural and societal context that can influence the proportion of women directors on bank boards.
Keywords
CEO Overconfidence; Asset Quality; Board Gender Diversity; NPLs
Main Subjects
Finance; Financial Accounting


Statistics Article View: 164 PDF Download: 266