Leverage, CEO Risk-Taking Incentives and Bank Failure during the 2007-2010 Financial Crisis

Usual measures of the risk-taking incentives of bank CEOs do not capture the risk-shifting incentives that the exposure of a CEO's wealth to his firm's stock price (delta) creates in highly levered firms. We find evidence consistent with the importance of these incentives for bank CEOs: In a sample of large U.S. financial firms, a higher pre-crisis delta is associated with a significantly higher probability of failure during the 2007-2010 financial crisis in highly levered firms, but not in less levered firms

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Year of publication:	2017
Authors:	Boyallian, Patricia
Other Persons:	Ruiz-Verdú, Pablo (contributor)
Publisher:	[2017]: [S.l.] : SSRN
Subject:	Bankinsolvenz \| Bank failure \| Finanzkrise \| Financial crisis \| Führungskräfte \| Managers \| Bankrisiko \| Bank risk \| Managervergütung \| Executive compensation

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Extent:	1 Online-Ressource (51 p)
Series:	A revised version of this paper has been accepted for publication in the Review of Finance. Published by Oxford University Press
Type of publication:	Book / Working Paper
Language:	English
Notes:	Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments June 10, 2016 erstellt
Other identifiers:	10.2139/ssrn.2571332 [DOI]
Classification:	G30 - Corporate Finance and Governance. General ; G34 - Mergers; Acquisitions; Restructuring; Corporate Governance ; G21 - Banks; Other Depository Institutions; Mortgages ; G32 - Financing Policy; Capital and Ownership Structure ; M12 - Personnel Management
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10012972096