The impact of SFAS133 on income smoothing by banks through loan loss provisions

• Main Authors: Kilic, Emre, LOBO, Gerald J., RANASINGHE, Tharindra, Sivaramakrishnan, K.
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2013
• Subjects: SFAS 133; Income Smoothing; Hedging; Derivatives; Loan Loss Provisions; Accounting; Corporate Finance
• Online Access: https://ink.library.smu.edu.sg/soa_research/984; https://ink.library.smu.edu.sg/context/soa_research/article/1983/viewcontent/ImpactSFAS133Income_Smoothing_2013_pp.pdf
• Institution: Singapore Management University

We examine the impact of SFAS 133, Accounting for Derivative Instruments and Hedging Activities, on the reporting behavior of commercial banks and the informativeness of their financial statements. We argue that because the stricter recognition and classification requirements of SFAS 133 reduced ban...