| Title | The determinants of high-interest entrusted loans in China |
| Authors | Yu, Yan Lee, Yi-Tsung Fok, Robert C. W. |
| Affiliation | Beijing Technol & Business Univ, Business Sch, 11-33 Fucheng Rd, Beijing 100048, Peoples R China Peking Univ, Guanghua Sch Management, Beijing, Peoples R China Univ Wisconsin Parkside, Dept Business, Kenosha, WI USA |
| Keywords | CORPORATE CASH HOLDINGS LARGE SHAREHOLDERS UPPER ECHELONS AUDIT QUALITY RISK-TAKING BANKING FINANCE FIRMS OVERCONFIDENCE INFORMATION |
| Issue Date | Jun-2020 |
| Publisher | JOURNAL OF BUSINESS FINANCE & ACCOUNTING |
| Abstract | We examine the determinants of high-interest entrusted loans in China from the perspective of corporate risk-taking. The results of a baseline model illustrate that the propensity to offer high-interest entrusted loans increases with loose monetary policies, corporate cash holdings and firm age, and it decreases with firm size and growth opportunity. These findings support the claim that firms offer high-interest entrusted loans mainly for short-term profits. Other determining factors include CEO behavior traits, market imperfections and the intensity of corporate governance. Specifically, market imperfections create an opportunity for risk-taking while CEO behavior and the intensity of corporate governance affect a firm's tendency to take risk and engage in high-interest entrusted loans. |
| URI | http://hdl.handle.net/20.500.11897/617106 |
| ISSN | 0306-686X |
| DOI | 10.1111/jbfa.12474 |
| Indexed | SSCI |
| Appears in Collections: | 光华管理学院 |
