The relationship between bank capital ratios, performance and risk
: an empirical study on the top 100 U.S. banks between 2013 and 2019

  • Gianmarco Morra (Student)

Student thesis: Master's Thesis


Using a sample composed of the top 100 largest banks in the U.S. in the period between 2013 and 2019 (with data retrieved from BankFocus), this Dissertation investigates the relationship between risk and performance, using different types of capital ratios as independent variables. According to the hypothesis tested, through a Panel Data Estimation, an increase in capital corresponds to a higher profitability and to lower risk exposure. The hypothesis seems to be confirmed by the non-risk-based capital measures, while this relationship is demonstrated to be insignificant for the risk-based ones.These results may have an impact on the regulator that should rediscuss the corresponding policy instruments according to which there is a minimum constraint on the risk-weighted measures of capital ratios that do not result correlated to bank profitability and risk.The findings are robust to different subsamples and alternative profitability and risk measures.
Date of Award25 Jan 2023
Original languageEnglish
Awarding Institution
  • Universidade Católica Portuguesa
SupervisorDiptes Chandrakante Prabhudas Bhimjee (Supervisor)


  • Bank capital
  • Basel capital
  • Capital ratio
  • Risk
  • Profitability
  • Panel data


  • Mestrado em Gestão e Administração de Empresas

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