
Document Type
Article
Abstract
This study empirically examines the moderating effect of bank competition on the link between monetary policy interest rates and bank risk-return dynamics in Vietnam from 2007 to 2019. The findings suggest that during monetary expansion, marked by decreasing interest rates, banks typically employ a more conservative strategy regarding their credit portfolios, thereby minimizing risk exposure. Nonetheless, this risk avoidance incurs reduced interest margins, decreased overall profitability, and compromised stability. Furthermore, the research utilizing both traditional and funding-adjusted Lerner indices indicates that increased market concentration, or diminished bank competitiveness, mitigates the impact of monetary policy interest rates on the trade-off between bank risk and return.
Recommended Citation
Huynh, Japan
(2025)
"Monetary Policy Interest Rates and Bank Risk return Tradeoff: How Does Bank Competition Moderate this Relationship?,"
Bulletin of Monetary Economics and Banking: Vol. 28:
No.
2, Article 1.
DOI: https://doi.org/10.59091/2460-9196.2011
Available at:
https://bulletin.bmeb-bi.org/bmeb/vol28/iss2/1
First Page
173
Last Page
198
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License
Country
Vietnam
Affiliation
Ho Chi Minh City Open University