Abstract
This research provides experienced more determinants behind the systematic risk surrounding banks. For this purpose, we use a number of regression models to test of there are statistical significance relations among a wide range of financial indicators and risk-assessment measure named “beta”. The results indicate that bank equity beta correlates positively with bank size, the volume of loans and the leverage ratio, and negatively with bank profitability, liquidity levels and loan loss provisions. The study refers to the Jordanian banking sector. Our findings are of significance both to bank managers as well as investors, since they will enable them to fully assess the effects of different strategic choices on a bank’s risk profile. We concluded potential policy implications regarding the impact of Basel III for observed risk-leverage relationship.
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