Видеозапись семинара "Is it Worth Being Transparent? Market Power and Voluntary Disclosure by Russian banks "
Speaker: Mikhail Raschupkin (Research Assistant, Center for Institutional Studies, NRU HSE)
June 4, Thursday, Myasnitskaya 24, building 3, room 424, 17.30.
Information disclosure is considered as an important prerequisite for the efficient functioning of a financial system. Costs and benefits of information disclosure - voluntary and mandatory - have been extensively theoretically and empirically investigated. However, the link between voluntary disclosure and market power is still empirically unexplored. Our paper fills this gap in literature. We test the hypothesis that banks tend to under-report information about their financial and operating condition due to the presence of proprietary costs. Our sample consists of 150 largest Russian banks for the period 2004-2013. Preliminary findings show that during crisis bank voluntary disclosure is considered as a positive signal by depositors leading to increased bank market share. The link between transparency and market position, though, depends on bank asset quality. Bank with lower asset quality looses their market share when more information is disclosed. There are also some evidences that higher disclosure corresponds to higher bank market power measured as Lerner index. However, this result is not stable and needs further investigation.
Working paper: download (PDF, 268 Кб)