Why are financial "institutions special" -- Financial services : depository institutions -- Financial services : finance companies -- Financial services : securities brokerage and investment banking -- Financial services : mutual funds and hedge funds -- Financial services : insurance -- Risks...

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...