Does capital regulation matter for bank behaviour ? Evidence for German savings banks

@inproceedings{Heid2004DoesCR,
  title={Does capital regulation matter for bank behaviour ? Evidence for German savings banks},
  author={Frank Heid and Daniel Porath},
  year={2004}
}
The aim of this paper is to assess how German savings banks adjust capital and risk under capital regulation. We estimate a modified version of the model developed by Shrieves and Dahl (1992). This paper contributes to the literature in three ways. First, we test the capital buffer theory (Marcus 1984, Milne and Whalley 2002). Second, we use dynamic panel data techniques that explicitly take unobserved heterogeneity into account. And third, we provide new evidence for non-US banks by using a… CONTINUE READING
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