This paper empirically examines how capital affects a bank’s performance (survival and market share) and how this effect varies across banking crises, market crises, and normal times that occurred in the US over the past quarter century. We have two main results. First, capital helps small...

We investigate benefits to business borrowers from bank bailouts – specifically the Troubled Asset Relief Program (TARP). Applying difference-in-difference methodology to loan-level data, we find more favorable contract terms in five dimensions – spread, amount, maturity, collateral, and...

Financial crises result in price and quantity rationing of otherwise creditworthy business borrowers, but little is known about the relative severity of these two types of rationing, which borrowers are rationed most, and the roles of foreign and domestic banks. Using a dataset from 50 countries...

Minority-owned banks have a mission to promote economic well-being in their communities. In particular, specialization in lending based on a central mechanism of shared-minority identity can yield an advantage in serving community needs through times of financial and economic crises. To test...

We address two key issues concerning bank bailout effects on depositor and bank behavior. The first is whether bailouts weaken or strengthen market discipline by depositors through deposit supplies. The second is if bailed-out banks decrease or increase their deposit demands. These questions can...

Minority-owned banks have a mission to promote economic wellbeing in their communities. In particular, specialization in lending based on a central mechanism of shared-minority-identity can yield an advantage in serving community needs through times of financial and economic crises. To test this...

Governments provide guarantees to banks, such as deposit insurance, often increasing them during financial crises. While risk effects are well researched, impacts on bank output remain largely unexplored. We investigate bank output effects using data from 75 countries on bank liquidity creation,...

We investigate how relationship borrowers fare relative to others in loan contract terms (spread, collateral, maturity, amount) during times of need using the COVID-19 quasi-natural experiment. COVID-19 is superior for such analysis because it primarily affects borrowers rather than banks. Our...

This paper empirically examines how capital affects a bank's performance (survival and market share), and how this effect varies across banking crises, market crises, and normal times that occurred in the U.S. over the past quarter century. We have two main results. First, capital helps small...

Do business bailouts help alleviate recipient firms’ financial and economic constraints, are effects strongest for the primary targets of the bailouts, and are effects temporary or long-lasting? We address these questions for the Paycheck Protection Program (PPP) small business bailout during...