banks and find no evidence that this shift in the bank business model harms bank profitability. To the contrary, a higher … share of non-traditional bank income is associated with a higher profitability. The increase in profitability does not seem … to come at the cost of substantially larger bank-level risk taking, at least not for large banks, which are the banks …

This paper investigates whether monitoring by bank lenders affects CEO incentives of borrowing firms. We find that an … increase in bank monitoring incentives significantly reduce the sensitivity of CEO wealth to stock return volatility (Vega …). The results are more profound when bank lenders are more powerful and reputable and have a prior lending relationship with …

We study lottery behavior in banking stocks and use MAX/MIN to capture loss protection from bank bailout guarantees. We … find that bank lottery preferences lead to lower short-term returns and that regulatory TARP assistance increases the … likelihood of bank lotteryness and risk taking. Lottery-type bank equities are riskier after TARP and exhibit fatter right to …