Stever, Ryan; Wilcox, James A - Bank for International Settlements (BIS) - 2007
We propose that individual banks' reported loan losses and provisions for future loan losses are lower, all else equal … underreporting charge-offs and provisions provides banks with incentives, when the banking industry is weaker, to cluster more, or to … seek "safety in similarity." We provide evidence that large, individual U.S. banks indeed tend to report both lower charge …