Firms’ risk-taking for customers’ benefit and its relevance with performance relative to aspiration

Figures & data

Table 1. The definitions and differences from model 1 to model 8

	Table 2				Table 3
	Model 1	Model 2	Model 3	Model 4	Model 5	Model 6	Model 7	Model 8
Proxy for aspirations	Historical aspirations (firm’s past performance)				Social aspirations (the performance of comparable organizations)
Independent variables	Control variables	Model 1 + Positive PRA	Model 2 + Family firms	Model 3 + Positive PRA*Family firms	Control variables	Model 1 + Positive PRA	Model 2 + Family firms	Model 3 + Positive PRA*Family firms
Hypothesis to test	None	Hypothesis 1	None	Hypothesis 2	None	Hypothesis 1	None	Hypothesis 2

Table 2. Descriptive statistics and correlation matrix

	Obs	Mean	S.D	min	Max	1	2	3	4	5	6	7	8	9	10	11
1. PF loan engagement (DV)	711	3.968	3.432	0.000	15.850	1.00
2. Positive PRA (IV)	711	0.002	0.005	0.000	0.081	0.633***	1.000
3. Family firms	711	0.493	0.501	0.000	1.000	0.391***	0.174	1.000
4. Corporate loan ratio	711	61.640	21.758	0.000	99.151	0.202***	0.261***	0.420	1.000
5. PF ratio	711	45.000	28.052	0.000	96.141	0.217***	0.078	0.498***	−0.133*	1.000
6. Bank Soundness	711	2.036	11.664	−110.320	56.821	0.215***	0.340***	0.828	0.081	−0.031	1.000
7. Bank size	711	13.609	167.631	15.000	1143.000	−0.316***	−0.424***	−0.280***	−0.065	−0.127***	−0.281***	1.000
8. Bank age	711	31.645	15.141	0.000	49.000	0.242***	0.537***	0.267***	−0.424***	0.129*	0.224***	−0.491***	1.000
9. CEO replacement	711	0.038	0.191	0.000	1.000	−0.072	−0.122*	−0.024	0.553***	−0.038	−0.132*	0.019	−0.062	1.000
10. CEO tenure	711	8.204	3.614	1.000	20.000	0.124**	0.408***	0.052	−0.102*	−0.096*	0.262***	−0.181***	0.191***	−0.393***	1.000
11. CEO age	711	60.775	4.726	49.000	78.000	0.082	0.237***	−0.101*	0.174	−0.063	0.085	−0.051	0.011*	−0.176**	0.493***	1.000

Table 3. Results of random-effect GLS regression

	Model 1		Model 2		Model 3		Model 4
Variables	Coefficient	p-value	Coefficient	p-value	Coefficient	p-value	Coefficient	p-value
Positive PRA (Historical aspirations)			18.361	0.003	15.515	0.005	4.127	0.034
			(3.423)		(3.621)		(3.019)
Family firm					0.387	0.031	0.274	0.593
					(0.052)		(0.042)
Poitive PRA*Family firm							15.022	0.002
							(4.316)
Coporate loan ratio	−0.141	0.022	−0.122	0.008	−0.122	0.016	−0.131	0.012
	(0.005)		(0.004)		(0.005)		(0.005)
PF ratio	0.021	0.221	0.021	0.247	0.217	0.222	0.221	0.231
	(0.002)		(0.003)		(0.003)		(0.003)
Bank Soundness	0.005	0.112	0.005	0.079	0.005	0.072	0.005	0.072
	(0.003)		(0.003)		(0.001)		(0.002)
Bank size	−0.021	0.031	−0.022	0.028	−0.011	0.039	−0.011	0.014
	(0.001)		(0.001)		(0.001)		(0.001)
Bank age	0.111	0.400	0.011	0.367	−0.001	0.969	0.002	0.906
	(0.012)		(0.012)		(0.012)		(0.013)
CEO replacement	−0.303	0.029	−0.205	0.039	−0.122	0.031	−0.125	0.050
	(0.121)		(0.122)		(0.121)		(0.118)
CEO tenure	0.003	0.691	0.003	0.83	−0.005	0.617	−0.006	0.704
	(0.012)		(0.014)		(0.013)		(0.013)
CEO age	−0.004	0.521	−0.003	0.61	−0.004	0.595	−0.006	0.538
	(0.008)		(0.009)		(0.011)		(0.001)
Constant	3.408	0.002	0.263	0.771	0.473	0.625	0.533	0.567
	(1.091)		(1.085)		(0.949)		(0.938)
Sigma_u	3.283		2.573		2.261		2.452
Sigma_e	0.345		0.363		0.346		0.345
Rho	0.986		0.981		0.976		0.980
Wald chi-square	58.61		86.69		177.96		125.14
Number of observations	711		711		711		711

Note: standard errors are in parentheses.

Figure 1. Steeper slope of family firm’s risk-taking for customers with respect to positive PRA.

Table 4. Alternative test with different measure of PRA (social aspirations)

	Model 5		Model 6		Model 7		Model 8
Variables	Coefficient	p-value	Coefficient	p-value	Coefficient	p-value	Coefficient	p-value
Positive PRA (Social aspirations)			13.285	0.007	12.623	0.006	2.723	0.033
			(3.025)		(4.021)		(3.718)
Family firm					0.372	0.034	0.261	0.423
					(1.221)		(1.252)
Poitive PRA*Family firm							18.124	0.004
							(4.316)
Coporate loan ratio	−0.141	0.022	−0.123	0.011	−0.125	0.012	−0.133	0.018
	(0.005)		(0.004)		(0.005)		(0.005)
PF ratio	0.021	0.221	0.025	0.244	0.227	0.252	0.221	0.274
	(0.002)		(0.003)		(0.003)		(0.003)
Bank Soundness	0.005	0.112	0.006	0.078	0.005	0.071	0.005	0.073
	(0.003)		(0.004)		(0.002)		(0.003)
Bank size	−0.021	0.031	−0.025	0.025	−0.018	0.034	−0.012	0.013
	(0.001)		(0.001)		(0.001)		(0.001)
Bank age	0.111	0.400	0.011	0.367	−0.001	0.929	0.003	0.906
	(0.012)		(0.012)		(0.011)		(0.011)
CEO replacement	−0.303	0.029	−0.203	0.038	−0.121	0.032	−0.124	0.051
	(0.121)		(0.123)		(0.122)		(0.117)
CEO tenure	0.003	0.691	0.002	0.81	−0.004	0.517	−0.007	0.804
	(0.012)		(0.012)		(0.013)		(0.013)
CEO age	−0.004	0.521	−0.002	0.61	−0.003	0.522	−0.003	0.537
	(0.008)		(0.009)		(0.011)		(0.001)
Constant	3.408	0.002	0.261	0.772	0.471	0.621	0.532	0.561
	(1.091)		(1.085)		(0.949)		(0.938)
Sigma_u	3.283		2.571		2.361		2.441
Sigma_e	0.345		0.362		0.341		0.344
Rho	0.986		0.984		0.972		0.984
Wald chi-square	58.61		88.7		185.96		138.14
Number of observations	711		711		711		711

Note: standard errors are in parentheses.

Data availability statement

The data that support the findings of this study are available on request from the corresponding author. Part of the data used in the research cannot be disclosed to the outside due to the protection of banks’ customer information.