Bank loan-loss provisions and the income-smoothing hypothesis: An empirical analysis, 1976–1984

摘要: This article tests an income-smoothing hypothesis for a sample of 106 large bank holding companies the period 1976 to 1984. Our focus is on behavior provision loan losses as function income and alternative measures business conditions likely affect portfolio risk-taking or quality. Using econometric model with pooled time-series, cross-sectional data, we find evidence over our test period. dummy-variable models indicate that regional banking tend engage in smoothing more than money-center banks. Alternative motivations behavior, which include regulatory policy, risk management, agency theory, compensation are explored their policy implications considered.