Bezpieczny Bank

Ewa Miklaszewska
professor at the Banking Department at the Faculty of Finance of the Cracow University of Economics

Krzysztof Kil
professor at the Banking Department at the Faculty of Finance of the Cracow University of Economics

Reputational Risk: Problems with Understanding the Concept and Managing Its Impact

Abstract

Interest in reputational risk as a self-standing type of risk is relatively new. The research is driven not so much by regulatory requirements, but by stakeholders’ interest. Therefore, the purpose of this article is to trace the sources of reputational risk and consequences of the problems associated with a bank’s negative reputation. The paper focuses on the differences in the definitions and methodological problems of its measurement. The empirical part proposes a new index measuring reputational risk, based on the perspectives of important stakeholders. The panel models analyse the impact of the index on bank performance in CEE.

Key words: reputational risk, reputational index, performance of CEE banks