Foreign bank subsidiaries’ risk-taking behavior: Impact of home and host country national culture
Journal article
Ashraf, B. and Arshad, S. (2017). Foreign bank subsidiaries’ risk-taking behavior: Impact of home and host country national culture. Research in International Business and Finance. 41, pp. 318-355. https://doi.org/10.1016/j.ribaf.2017.04.039
Authors | Ashraf, B. and Arshad, S. |
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Abstract | This paper examines whether the risk-taking behavior of foreign affiliates of multinational banks is more influenced by the national culture of their parent banks’ home country or the national culture of foreign affiliates’ host country. The study uses a dataset of 292 foreign affiliates (i.e., subsidiaries or branch operations) operating in 66 countries having parent banks in 26 countries for empirical analysis. National culture of both home and host countries is measured with four dimensions—uncertainty avoidance, individualism, masculinity and power distance—of Hofstede's framework of national culture. Findings suggest that the national culture of parent banks’ home country has higher impact on the risk-taking behavior of foreign affiliates of multinational banks than the national culture of their host country. Specifically, foreign affiliates’ risk-taking is higher if parent banks’ home country has low uncertainty avoidance, high individualism and low power distance cultural values. This study extends our understanding that how informal institutions, such as the national culture, influence the financial decisions in multinational banks. |
Year | 2017 |
Journal | Research in International Business and Finance |
Journal citation | 41, pp. 318-355 |
Publisher | Elsevier |
ISSN | 0275-5319 |
Digital Object Identifier (DOI) | https://doi.org/10.1016/j.ribaf.2017.04.039 |
Web address (URL) | http://www.scopus.com/inward/record.url?eid=2-s2.0-85019053697&partnerID=MN8TOARS |
Publication dates | |
Online | 09 May 2017 |
Publication process dates | |
Accepted | 26 Apr 2017 |
Deposited | 11 Nov 2022 |
Accepted author manuscript | License File Access Level Open |
https://openresearch.lsbu.ac.uk/item/92640
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Accepted author manuscript
culture and multinational banks-Hap.pdf | ||
License: CC BY-NC-ND 4.0 | ||
File access level: Open |
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