Narrow search
Showing 1 - 10 of 108
Cover Image
How important is moral hazard for distressed banks?
Ben-David, Itzhak; Palvia, Ajay; Stulz, René M. - 2020
The moral hazard incentives of the bank safety net predict that distressed banks take on more risk and higher leverage …. Since many factors reduce these incentives, including charter value, regulation, and managerial incentives, the net economic … effect of these incentives is an empirical question. We provide evidence on this question using two distinct periods that …
Persistent link: https://www.econbiz.de/10012216705
Cover Image
The sources of financing constraints
Nikolov, Boris; Schmid, Lukas; Steri, Roberto - 2018
In order to identify the relevant sources of firms' financing constraints, we ask what financial frictions matter for corporate policies. To that end, we build, solve, and estimate a range of dynamic models of corporate investment and financing, embedding a host of financial frictions. We focus...
Persistent link: https://www.econbiz.de/10011976900
Cover Image
Securization and banks' capital structure
Almazan, Andres; Martín Oliver, Alfredo; Saurina, Jesús - 2015
Persistent link: https://www.econbiz.de/10011795921
Cover Image
Caught between Scylla and Charybdis? Regulating bank leverage when there is rent seeking and risk shifting
Acharya, Viral V.; Mehran, Hamid; Thakor, Anjan - 2010
Banks face two different kinds of moral hazard problems: asset substitution by shareholders (e.g., making risky, negative net present value loans) and managerial rent seeking (e.g., investing in inefficient 'pet' projects and consuming perquisites that yield private benefits). The privately...
Persistent link: https://www.econbiz.de/10010287043
Cover Image
Limited liability and option contracts in models with sequential investments
Lülfesmann, Christoph - 2001
The paper investigates a model where two parties sequentially invest in a joint project (an asset). Investments and the project value are unverifiable, and A is wealth constrained so that an initial outlay must be financed by either agent B or an external investor C, say a bank. We show that an...
Persistent link: https://www.econbiz.de/10011538898
Cover Image
Back to the future : the nature of regulatory capital requirements
Chami, Ralph; Cosimano, Thomas F.; Kopp, E.; Rochon, Céline - 2017
This paper compares the current regulatory capital requirements under the Dodd-Frank Act (DFA) and the 10-percent leverage ratio, as proposed by the U.S. Treasury and the U.S. House of Representatives' Financial CHOICE Act (FCA). We find that the majority of U.S. banks would not qualify for an...
Persistent link: https://www.econbiz.de/10011799690
Cover Image
Moral hazard and capital structure dynamics
Dewatripont, Mathias; Legros, Patrick; Matthews, Steven A. - 2002
Persistent link: https://www.econbiz.de/10001681302
Cover Image
Caught between Scylla and Charybdis? : regulating bank leverage when there is rent seeking and risk shifting
Acharya, Viral V.; Mehran, Hamid; Thakor, Anjan V. - 2010
Banks face two moral hazard problems: asset substitution by shareholders (e.g., making risky, negative net present value loans) and managerial rent seeking (e.g., investing in inefficient “pet” projects or simply being lazy and uninnovative). The privately optimal level of bank leverage is...
Persistent link: https://www.econbiz.de/10008826858
Cover Image
Caught between Scylla and Charybdis? : regulating bank leverage when there is rent seeking and risk shifting
Acharya, Viral V.; Mehran, Hamid; Thakor, Anjan V. - 2010 - Rev.
Banks face two different kinds of moral hazard problems: asset substitution by shareholders (e.g., making risky, negative net present value loans) and managerial rent seeking (e.g., investing in inefficient “pet” projects and consuming perquisites that yield private benefits). The privately...
Persistent link: https://www.econbiz.de/10008657183
Cover Image
A detrimental feedback loop : deleveraging and adverse selection
Bertsch, Christoph - 2013
Market distress can be the catalyst of a deleveraging wave, as in the 2007/08 financial crisis. This paper demonstrates how market distress and deleveraging can fuel each other in the presence of adverse selection problems in asset markets. At the core of the detrimental feedback loop is agents'...
Persistent link: https://www.econbiz.de/10010202960