Money laundering and bank risk: Evidence from US banks

Yener Altunbaş; John Thornton; Yurtsev Uymaz

doi:10.1002/ijfe.2044

Money laundering and bank risk: Evidence from US banks

Yener Altunbaş, John Thornton (Lead Author), Yurtsev Uymaz

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Abstract

We test for a link between bank risk and enforcements issued by US regulators against banks for money laundering (ML) in a sample of 960 publicly listed US banks over 2004-2015. ML-related enforcements are associated with increased bank risk on several measures of risk with the result robust to a variety of estimation methodologies. Moreover, the impact of money laundering on bank risk is accentuated by the presence of powerful CEOs and only partly mitigated by large and independent executive boards.

Original language	English
Pages (from-to)	4879-4894
Number of pages	16
Journal	International Journal of Finance and Economics
Volume	26
Issue number	4
Early online date	1 Aug 2020
DOIs	https://doi.org/10.1002/ijfe.2044
Publication status	Published - Oct 2021

Keywords

Bank risk
Money laundering
bank boards
CEO power
US banks

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10.1002/ijfe.2044

Accepted_ManuscriptAccepted author manuscript, 448 KB

Cite this

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Money laundering and bank risk: Evidence from US banks

Abstract

Keywords

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Yurtsev Uymaz

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