Composed since the: Kupiec, Paul H. and you may Carlos D. Ramirez. “Bank Failures additionally the Price of Systemic Exposure: Facts regarding 1900-1930." Log out-of Monetary Intermediation twenty two, no. step three (2013): 285-307.
So it papers investigates the end result away from bank disappointments into financial increases having fun with data away from 1900 so you’re able to 1930, a period of time that predates active authorities stabilization formula and you will is sold with symptoms out-of bank system stress which aren’t coincident which have recessions. Using both VAR and an improvement-in-improvement methodology you to definitely exploits the fresh responses of one’s New york and you can Connecticut economic climates to your Panic regarding 1907, i guess this new impact out-of lender disappointments into economic interest. Over this era, a 0.a dozen % (1 simple departure) upsurge in the fresh liabilities of your failed depository institutions results in a reduced amount of 17 payment activities about growth rate off industrial development and you may a 4 payment section lowering of real GNP growth.
Published as: Jorion, Philippe and you will Gaiyan Zhang. “Borrowing Contagion off Counterparty Exposure." The Journal away from Money 64, zero. 5 (2009): 2053-2087.
Simple borrowing from the bank exposure designs usually do not give an explanation for noticed clustering away from standard, sometimes named “borrowing contagion." This paper provides the basic empirical analysis from borrowing from the bank contagion through direct counterparty outcomes. I check the fresh wide range aftereffects of bankruptcy proceeding notices for the creditors having fun with an alternate databases. Normally, loan providers sense serious negative unpredictable equity productivity and you will develops for the Dvds advances. Likewise, creditors are more likely to have monetary stress later on. This type of outcomes try stronger to have industrial creditors than just financials. Simulations calibrated to the results indicate that counterparty risk could easily give an explanation for observed extreme clustering regarding defaults. This suggests one to counterparty chance is a vital additional station from borrowing from the bank contagion which latest portfolio credit exposure activities understate the brand new likelihood of highest loss.
The latest decreases exist in this three-quarters of your own 1st financial failure wonder and will end up being interpreted because the a measure of the expenses away from systemic exposure regarding the financial sector
Put Insurance and you can Financial Risk-Taking: Evidence off Internal Financing Evaluations FDIC Heart to have Financial Browse Doing work Report Zero. 2008-07 Vasso P. Ioannidou and you may Maria Fabiana Penas
Published while the: Ioannidou, Vasso P. and you will Maria Fabiana Penas. “Put Insurance policies and you can Financial Exposure-Taking: Proof out of Inner Loan Feedback." Log out of Monetary Intermediation 19, no. 1 (2010): 95-115.
This paper assesses the result from deposit insurance coverage with the banks’ risk-taking in the context away from a natural test playing with detailed credit registry study. I studies the situation regarding a rising benefit, Bolivia, one delivered in initial deposit insurance rates system when you look at the sample period, therefore we contrast banks’ exposure-bringing before and after the introduction of this product. elizabeth., loans with tough reviews at the origination). These types of funds bring large rates of interest consequently they are of even worse ex-post show. I in addition to discover that guarantee criteria and you may financing maturities commonly adjusted to compensate to your most risk. A lot more performance recommend that the increase for the exposure-taking comes from a reduction in business discipline out-of large depositors. Our very own findings as well as recommend that differences in exposure-getting ranging from large (too-big-to-fail) and you may quick banking institutions diminished shortly after deposit insurance rates.
Hedge Financing Activism, Business Governance, and you may Enterprise Results FDIC Center to possess Economic Lookup Performing Paper No. 2008-06 Vasso P. Ioannidou and you will Maria Fabiana Penas
We find that when the introduction of put insurance coverage, banking companies may begin riskier finance (i
Composed since: Brav, Alon, Wei Jiang, Honest Partnoy, and Randall Thomas. “Hedge Financing Activism, Corporate Governance, and you can Organization Show." This new Log off Money 63, no. cuatro (2008): 1729-1775.
Playing with a big give-compiled dataset regarding 2001 to 2006, we discover you to activist hedge fund regarding You.S. propose proper, functional, and loans in Atmore you can monetary treatments and you will to have achievements or partial achievement in two thirds of your times. Hedge fund rarely find handle and often are nonconfrontational. The latest abnormal go back within the statement from activism is approximately seven%, without reversal inside the subsequent seasons. Address firms feel expands from inside the payment, doing work performance, and better President turnover immediately following activism. All of our analysis brings very important the fresh proof into the mechanisms and effects out of told shareholder monitoring.