Brancati, Emanuele; Macchiavelli, Marco - 2016
We challenge the common view that short-term debt, by having to be rolled over continuously, is a risk factor that … exposes banks to higher default risk. First, we show that the average effect of expiring obligations on default risk is … insignificant; it is only when a bank has limited access to new funds that maturing debt has a detrimental impact on default risk …
