Abstract

This study examines whether the agency problem regarding credit risk is a useful corporate governance mechanism for controlling credit risk. For this purpose, we estimate the impact of internal control and agency problems on credit risk in commercial banks in Vietnam from 2009 to 2018. First, in line with corporate governance theory, we find that the agency problem is a statistically significant variable in the model. This result expands the existing literature. Second, we show that internal control is a mechanism to resolve the conflict of interest between the principal and agent. The author especially emphasizes the unchanged correlation of each independent variable to the dependent variable during the merger and restructuring of Vietnamese commercial banks in 2015.

Details

Title
The relationship between internal control and credit risk – The case of commercial banks in Vietnam
Author
Nguyen Kim Quoc Trung 1   VIAFID ORCID Logo 

1  Faculty of Accounting – Auditing, The University of Finance – Marketing, Ho Chi Minh City, South of Vietnam, Vietnam 
Publication year
2021
Publication date
Jan 2021
Publisher
Taylor & Francis Ltd.
e-ISSN
23311975
Source type
Scholarly Journal
Language of publication
English
DOI
https://doi.org/10.1080/23311975.2021.1908760
ProQuest document ID
2614935058
Copyright
© 2021 The Author(s). This open access article is distributed under a Creative Commons Attribution (CC-BY) 4.0 license. This work is licensed under the Creative Commons Attribution License http://creativecommons.org/licenses/by/4.0/ (the “License”). Notwithstanding the ProQuest Terms and Conditions, you may use this content in accordance with the terms of the License.