Capital ratios and the Weighted Average Cost of Capital: Evidence from Chilean banks

This paper finds that an additional percentage point in the ratio of Common Equity Tier 1 (CET1) capital to risk-weighted assets is associated with an increase in the Weighted Average Cost of Capital (WACC) of Chilean banks by a maximum of only 11.7 basis points. This result is found by evaluating t...

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Bibliographic Details
Main Authors: Rodrigo Cifuentes, Tomás Gómez, Alejandro Jara
Format: Article
Language:English
Published: Elsevier 2025-03-01
Series:Latin American Journal of Central Banking
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Online Access:http://www.sciencedirect.com/science/article/pii/S2666143824000255
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