foreign-owned - tended to be heavy risk takers. Most of them had excessive credit growth. - Laeven uses a linear programming … requires assessing both efficiency and risk factors, so Laeven also introduces a measure of risk taking. This risk measure … helps predict which banks were restructured after the crisis of 1997. Laeven finds that foreign-owned banks took little risk …

This paper proposes a theoretically sound and easy-to-implement way to measure the systemic risk of financial … institutions using publicly available accounting and stock market data. The measure models credit risk of banks as a put option on …-sector losses from systemic default risk as the value of a put option written on a portfolio of aggregate bank assets whose exercise …