Turnover threat and CEO risk-taking behavior in the banking industry
Board independence, CEO risk-taking, CEO turnover
Journal of Banking and Finance
We examine how the threat of turnover affects bank CEOs’ risk-taking behavior. Using a sample of 212 U.S. banks from 1995 to 2010, in contrast with prior studies focusing on non-banking firms, we find a non-monotonic relationship between CEO turnover threat and CEO risk-taking behavior in the banking industry. Bank CEOs increase their risk-taking when the perceived turnover threat is moderate but reduce risk-taking when turnover threat is more imminent. This effect tends to concentrate on banks with a majority of independent directors.
Original Publication Date
DOI of published version
UNI ScholarWorks, Rod Library, University of Northern Iowa
Chen, Zhongdong and Ebrahim, Alireza, "Turnover threat and CEO risk-taking behavior in the banking industry" (2018). Faculty Publications. 640.