The Impact of Central Bank Digital Currencies News on Bank Stability: Evidence from ASEAN-5 Countries

This study constructs an index reflecting Central Bank Digital Currency (CBDC) news coverage and evaluates its impact on bank stability. The CBDC Attention Index (CBDCAI) is formulated based on more than 533 Reuters Digital News Report articles from 2019 to 2023. Employing the System Generalized Method of Moments (GMM) approach with data from 92 banks across ASEAN-5 nations, and implementing quantile regression for robustness checks, the findings demonstrate a significant relationship between the CBDCAI and bank stability, alongside variables such as bank size and capitalization. These results offer valuable guidance for central banks, especially within the ASEAN-5 region, as they advance CBDC initiatives.