This study examines the effect of economic policy uncertainty (EPU) on bank stability using bank-level panel data from 2005 to 2019. The findings show that EPU decreases bank stability, but the effect varies across the bank and market structure, and it is significantly higher during financial crisis periods. Moreover, we examine the roles of institutional quality and bank competition in shaping the EPU-bank stability nexus. The results show a significant threshold effect on the EPU bank stability nexus using the threshold estimation technique considering nonlinearity. Countries with institutional quality above the threshold level reduce the adverse impact of policy uncertainty on bank stability, while lower bank competition reinforces the adverse effect. In addition, EPU adversely impacts bank stability in all countries in the sample regardless of countries' development and income levels. The results are robust to alternative risk indicators and various additional tests. Our empirical work has specific policy implications for banks, regulatory bodies, and government agencies for decision-making.

本研究使用 2005 年至 2019 年的银行层面面板数据检验了经济政策不确定性 (EPU) 对银行稳定性的影响。 结果表明，EPU 降低了银行稳定性，但影响因银行和市场结构而异，并且显着在金融危机期间更高。此外，我们研究了制度质量和银行竞争在塑造 EPU-银行稳定性关系中的作用。结果表明，使用考虑非线性的阈值估计技术对 EPU 组稳定性关系有显着的阈值影响。制度质量高于门槛水平的国家减少了政策不确定性对银行稳定性的不利影响，而较低的银行竞争加剧了不利影响。此外，无论国家的发展和收入水平如何，EPU 都会对样本中所有国家的银行稳定性产生不利影响。结果对于替代风险指标和各种附加测试是稳健的。我们的实证工作对银行、监管机构和政府机构的决策具有特定的政策影响。