Efficient Capital Regulation of US Bank Holding Companies: An Integrative Literature Review

Abstract

Background: Most Bank holding companies (BHCs) sustains significant losses and increased risk exposure which caused them to become insolvent. BHCs that become insolvent have a negative impact on the U.S. economy. There is a lack of effective practice towards capital regulation that causes BHC to incur significant losses. Methodology: This integrative literature review focused on studying current research findings on efficient capital regulation practices in relation to governance, risk management, internal control, assurance and compliance in BHCs. A wide range of search terms was used to extract and select pertinent peer-reviewed literature from numerous search engines and databases, with emphasis on studies published within the past 5 years. Findings: This integrative literature review provides in-depth knowledge of capital regulation, governance, risk management, internal control, assurance and compliance practices in BHCs. An effective practice towards capital regulation may help senior bank managers reduce risky behaviors and investments that causes significant bank losses. Originality: This integrative literature review can be used by future researchers as foundational material to extend theoretical foundations and the results of related studies. It has helped to highlight Compliance and Ethics Group's standard' concepts and inform recommendation for future research that identifies effective practices towards capital regulation in BHCs.