TY - JOUR ID - 119165 TI - The effect of the politically connected CEO on credit risk in Iranian commercial banks JO - Iranian Journal of Finance JA - IJF LA - en SN - 2676-6337 AU - Heidari, Ali AU - Abbasian, Ezatollah AU - Khalili, Farzaneh AD - Ph.D. Candidate in Finance, Central Tehran Branch, Islamic Azad University, Tehran, Iran. AD - Associate Prof. in Economics, Department of Public Administration, Faculty of Management, University of Tehran, Tehran, Iran. AD - Assistant Professor in Economics, Department of Humanities, Abhar Branch, Islamic Azad University, Zanjan, Iran. Y1 - 2020 PY - 2020 VL - 4 IS - 3 SP - 1 EP - 17 KW - Credit risk KW - Politically Connected CEO KW - Iranian Commercial Banks KW - SGMM DO - 10.22034/ijf.2020.244253.1150 N2 - It has been widely stated in the theoretical literature that political connections increase the value of organizations. Political connections may have both a positive and negative effect on the performance of the bank. Politically connected banks may have better access to financing, timely liquidity support from the central bank or banks which are connected with other political organizations and reduction in the pressure of legal authorities if such a reduction is possible, such as the easy passage of legal inspection. A politically connected bank can also use communications to exchange assistance to achieve the organization's goals. Therefore, answering the question of whether banks' political connections have a positive or negative impact on their financial performance cannot be answered with certainty. This study attempts to investigate the effects of interactions between politically connected CEO (PCCEO), independent directors, and credit risk of banks in an emerging country context where corporate governance systems appear weak. In this study, to collect the required data, we use the information database of Codal publishers for the listed banks in the Tehran Stock Exchange and the information existing in the performance report of the Iranian banks for public banks that collected by the Iran Banking Institute. For the investigation of this issue, we employ the SGMM method (System Generalized Method of Moments) or in other words, dynamic GMM approach, and we find politically connected boards to exert significant influence on credit risk. UR - https://www.ijfifsa.ir/article_119165.html L1 - https://www.ijfifsa.ir/article_119165_c23c4760e7bc595e69a718d8d49162a8.pdf ER -