Regulation, Capital and Risk in GCC Banking Systems

Abstract

This thesis examines three important issues relating to the banking and financial sectors in GCC countries. In particular, we explore the structure of GCC banking and financial systems, (including the financial characteristics of GCC banks), banking regulation and supervision in the region, and the impact of capital adequacy regulation on the level of bank capital and risk. The thesis analyses whether capital adequacy regulation impacts on bank capital and risk levels for one sample of commercial banks from GCC countries. After examining the financial features of GCC banks from the 1990s onwards, we employ a simultaneous equation model to examine adjustments in capital and risk at banks over the period 1988 to 2003 . The results show a positive association
between changes in risk and capital. The findings also indicate that the bank capital regulation may induce banks to increase their capital level, but this may not be effective in influencing the level of banking sector risk.

Date of Award	Jul 2008
Original language	English
Awarding Institution	Bangor University
Supervisor	Philip Molyneux (Supervisor)