Global Business and Finance Review | 2026
Authors: Tran T.N.T.; Tran X.L.N.
DOI: 10.17549/gbfr.2026.31.2.52
Journal: Global Business and Finance Review
Year: 2026
Publisher: People and Global Business Association
Document Type: Article
Open Access: All Open Access; Gold Open Access
Cited by: 0
Purpose: Based on research data from 24 listed commercial banks in the period 2012-2022, via regression using the Bayesian approach, the study provided evidence of the optimal threshold in capital structure to improve the stability of banks. Design/methodology/approach: Regarding macroeconomic factors, economic growth tends to erode the banking system's stability, while inflation has a vague impact. Furthermore, through the Bayesian approach via the Monte Carlo algorithm, the study has proposed a method to determine the optimal capital structure for each specific bank to cope with risk. Findings: The results show that the deposit-to-asset value of ACB (Asia Commercial Bank) and CTG (Vietnam Joint Stock Commercial Bank for Industry and Trade) has exceeded the optimal threshold. For non-deposit-to-asset, ACB is approximately at the optimal level; for CTG, this ratio is significantly lower than the optimal level; hence, they could increase this ratio to control risks and create more capital to finance their activities. Research limitations/implications: This research result is an essential practical contribution; it could help specific banks determine the appropriate capital structure to maintain operational stability. Research results could reflect the characteristics of the market being studied. Then, we would use this research result as prior information and combine it with data from each specific bank to estimate the posterior probability of the impact of capital on risk, thereby estimating the appropriate capital structure for the bank that needs to be researched. Originality/value: The paper provided evidence of an optimal capital structure that is associated with lower risk in Vietnamese banks. In addition, foreign capital also tends to improve the stability of the banking system, while bank size increases risks. © The Author(s).
Bank optimal capital structure; Bank risk; Bayesian econometric