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This paper empirically investigates banks’ investment allocations over the recent business cycle. I identify … unsolicited deposit shocks resulting from unconventional energy development and estimate bank allocations of these deposits. In … the pre-recession period, banks lend 38 percent of incremental deposits; however, during the downturn, banks favor liquid …
Persistent link: https://www.econbiz.de/10010936676
This paper investigates the incentives for banks to bias their internally generated risk estimates. We are able to … estimate bank biases at the credit level by comparing bank-generated risk estimates within loan syndicates. The biases are … positively correlated with measures of regulatory capital, even in the presence of bank fixed effects, consistent with an effort …
Persistent link: https://www.econbiz.de/10011103531
In moral hazard models, bank shareholders have incentives to transfer wealth from the deposit insurer - that is …, maximize put option value - by pursuing riskier strategies. For safe banks with large charter value, however, the risk … value, and a risk measure, this paper develops a semi-parametric model for estimating the critical level of bank risk at …
Persistent link: https://www.econbiz.de/10001630859