Little is known about how socioeconomic characteristics of executive teams affect corporategovernance in banking. Exploiting a unique dataset, we show how age, gender, and educationcomposition of executive teams affect risk taking of financial institutions. First, we establish thatage, gender, and education jointly affect the variability of bank performance. Second, we usedifference-in-difference estimations that focus exclusively on mandatory executive retirementsand find that younger executive teams increase risk taking, as do board changes that result in ahigher proportion of female executives. In contrast, if board changes increase the representationof executives holding Ph.D. degrees, risk taking declines.
Keywords: Banks, executives, risk taking, age, gender, education JEL Classifications: G21, G34, I21, J16