• Dr. PSV Balaji Rao
• Mr. Avinash M A

Greater transparency and disclosure of the bank activities will not prevent future banking crises unless appropriate monetary, fiscal and regulatory policies are also adopted. Nonetheless, greater disclosure of banking problems can reduce the costs of banking crises, even if transparency is not a panacea for preventing banking crises. This study reports the results of an empirical investigation of the extent of voluntary disclosure by listed banking companies in India. It also reports the results of the association between company specific characteristics and voluntary disclosure of the sample companies. The study reveals that Indian banks are disclosing a considerable amount of voluntary information. The findings also indicate that size and assets‐in‐place are significant and other variables such as age, diversification, board composition, multiple exchange listing and complexity of business are insignificant in explaining the level of disclosure. However, this paper has contributed to the academic literature that financial institutions provide voluntary corporate information including social information as discharging their social responsibility and corporate citizenship Over the past years, a number of initiatives have sought to increase the transparency of financial institutions. Among those initiatives, a push toward more disclosure of information in published accounts has been prominent. In particular, policy proposals have introduced a number of disclosure requirements that aim to improve the market’s ability to assess a bank’s risk and value. Whether such initiatives are beneficial is an open question. Indeed, there are a number of good reasons to be skeptical. First, it can be argued that banks are inherently opaque institutions, and increases in disclosure may not be able to materially change this. “The push for increased market discipline and disclosure may shed light. But reformers should remember what they are dealing with. Second, an increase in quantitative disclosures may not necessarily increase transparency. In the words of Federal Reserve Chairman Alan Greenspan: “A more complex question is whether greater volume of information has led to comparable improvements in transparency of firms. In the minds of some, public disclosure and transparency are interchangeable. But they are not. Transparency challenges market participants not only to provide information but also to place that information into a context that makes it meaningful”. Third, disclosure is costly. Clearly,requiring disclosure of information imposes a cost on banks, as on any firm, and this cost must be offset by resulting benefits for it to be justified. The costs of disclosure include the direct costs of producing and disseminating information, but also indirect costs that might arise when a bank’s competitors are able to exploit the information that the bank provides to the financial market. To date, there is less empirical evidence has been found to help resolve the questions about the benefits of bank disclosure. This paper attempts to fill this gap by presenting evidence on whether disclosure is beneficial for banks and whether disclosure is useful for financial markets. We investigate empirically the relationship between the volatility of a bank’s stock price and the amount of information the bank discloses to the market. In particular, we ask whether banks that disclose a lot of information might have lower stock volatility than do banks that disclose little information.

Banking system, Volatility of Banks, Extent of Disclosure, Risk, Annual report

"“Disclosure and transparency in banking”", International Journal of Emerging Technologies and Innovative Research (www.jetir.org), ISSN:2349-5162, Vol.5, Issue 10, page no.14-21, October-2018, Available :http://www.jetir.org/papers/JETIRG006003.pdf

"“Disclosure and transparency in banking”", International Journal of Emerging Technologies and Innovative Research (www.jetir.org | UGC and issn Approved), ISSN:2349-5162, Vol.5, Issue 10, page no. pp14-21, October-2018, Available at : http://www.jetir.org/papers/JETIRG006003.pdf