Do Women Directors Matter for Bank Risk After Bailouts? Evidence From U.S. Bank Holding Companies

This study examines whether board gender diversity is associated with lower bank risk following government bailout interventions. Using a sample of U.S. bank holding companies comprising 2,317 bank-year observations for bailout recipients and 2,766 observations for non-bailout banks, the study analyses credit, market, and operational risk. Drawing on Critical Mass Theory, it tests whether the influence of women directors becomes more observable only once female representation moves beyond tokenism. The results show that boards with 20–40% female representation exhibit the most consistent reductions in risk across all risk measures, suggesting that this tilted range represents an important threshold for effective board influence. The findings remain supported by robustness checks, including bank-size analysis and instrumental-variable estimation. The study contributes to the banking governance literature by clarifying the level of female board representation at which gender diversity becomes systematically associated with more prudent risk-taking.