Determinants of Signaling by Banks through Loan Loss Provisions

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Bank Loan Loss Provisions Research: A Review (2017, background): “…on whether (and how) banks use LLPs to signal private information to firm outsiders about the quality of bank loan portfolio (e.g. Ahmed et al., 1999; Beaver & Engel, 1996; Beaver, Eger, Ryan, & Wolfson, 1989; Griffin & Wallach, 1991; Kanagaretnam et al., 2005; Liu & Ryan, 1995; Wahlen, 1994).”
Policy uncertainty and loan loss provisions in the banking industry (2020, unknown): “…use loan loss provisions as a signal of expected loan conditions (e.g., Scholes et al., 1990; Wahlen, 1994; Beaver and Engel, 1996; Liu et al., 1997; Kanagaretnam et al., 2004, 2005), then we would expect more future charge-offs for banks that make more loan loss provisions in the current period.”
Bank Income Smoothing, Ownership Concentration and the Regulatory Environment (2014, unknown): “9Banks can also use loan loss provisions to signal their financial strength (Ahmed et al. 1999, Kanagaretnam et al. 2004, Kanagaretnam et al. 2005, Leventis et al. 2012); this is generally captured by the one-year-ahead change of earnings before taxes and loan loss provisions (ERi,t+1 − ERi,t) in…”