CEO turnover in large banks: Does tail risk matter?

Srivastav, Abhishek; Keasey, Kevin; Mollah, Sabur; Vallascas, Francesco

Abstract

In a cross-country setting we show the probability of a forced CEO turnover in large banks is positively associated with idiosyncratic tail risk. This finding is strengthened the greater the competition in the banking industry and when stakeholders have more to lose in the case of distress. Overall, the exposure to idiosyncratic tail risk offers valuable signals to bank boards on the quality of the choices made by CEOs. In contrast, systematic tail risk becomes important for forced CEO turnovers only in the presence of a major variation in the costs this risk generates for shareholders and the organization.

Citation

Srivastav, A., Keasey, K., Mollah, S., & Vallascas, F. (2017). CEO turnover in large banks: Does tail risk matter?. Journal of Accounting and Economics, 64(1), 37-55. https://doi.org/10.1016/j.jacceco.2017.05.001

• Journal Article Type: Article
• Acceptance Date: May 15, 2017
• Online Publication Date: May 19, 2017
• Publication Date: 2017-08
• Deposit Date: Jul 28, 2020
• Publicly Available Date: Jul 28, 2020
• Journal: Journal of Accounting and Economics
• Print ISSN: 0165-4101
• Electronic ISSN: 1879-1980
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 64
• Issue: 1
• Pages: 37-55
• DOI: https://doi.org/10.1016/j.jacceco.2017.05.001
• Public URL: https://durham-repository.worktribe.com/output/1265138
• Related Public URLs: http://eprints.whiterose.ac.uk/116747/