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Do distressed banks really gamble for resurrection?
Ben-David, Itzhak; Palvia, Ajay; Stulz, René M. - 2019
We explore the actions of financially distressed banks in two distinct periods that include financial crises (1985 … widespread belief that distressed banks gamble for resurrection, we document that distressed banks take actions to reduce … forces beyond formal regulations incentivize bank managers to deleverage when their banks are in distress …
Persistent link: https://www.econbiz.de/10012107655
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How important is moral hazard for distressed banks?
Ben-David, Itzhak; Palvia, Ajay; Stulz, René M. - 2020
The moral hazard incentives of the bank safety net predict that distressed banks take on more risk and higher leverage … include financial crises and are subject to different regulatory regimes (1985–1994, 2005–2014). We find that distressed banks …
Persistent link: https://www.econbiz.de/10012216705
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Aligning Incentives at Systemically Important Financial Institutions
Baily, Martin Neil - 2013
UBS recently announced it would pay part of the bonuses of 6,500 highly compensated employees with bonds that would be forfeited if the bank does not meet its capital requirements. This memo underscores the benefits of contingent deferred compensation and makes recommendations for how such...
Persistent link: https://www.econbiz.de/10013084413
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Why did small business fintech lending dry up during march 2020?
Ben-David, Itzhak; Johnson, Mark J.; Stulz, René M. - 2021
With the onset of the COVID-19 crisis in March 2020, small business lending through fintech lenders collapsed. We explore the reasons for the market shutdown using detailed data about loan applications, offers, and take-up from a major small business fintech credit platform. We document that...
Persistent link: https://www.econbiz.de/10012816397
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The dark side of outside directors: Do they quit when they are most needed?
Fahlenbrach, Rüdiger; Low, Angie; Stulz, René M. - National Bureau of Economic Research (NBER) - 2010
Outside directors have incentives to resign to protect their reputation or to avoid an increase in their workload when they anticipate that the firm on whose board they sit will perform poorly or disclose adverse news. We call these incentives the dark side of outside directors. We find strong...
Persistent link: https://www.econbiz.de/10008631680
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Differences in Governance Practices between U.S. and Foreign Firms : Measurement, Causes, and Consequences
Aggarwal, Reena - 2018
We construct a firm-level governance index that increases with minority shareholder protection. Compared to U.S. matching firms, only 12.68% of foreign firms have a higher index. The value of foreign firms falls as their index decreases relative to the index of matching U.S. firms. Our results...
Persistent link: https://www.econbiz.de/10012706508
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Do U.S. Firms Have the Best Corporate Governance? A Cross-Country Examination of the Relation between Corporate Governance and Shareholder Wealth
Aggarwal, Reena - 2012
We compare the governance of foreign firms to the governance of similar U.S. firms. Using an index of firm governance attributes, we find that, on average, foreign firms have worse governance than matching U.S. firms. Roughly 8% of foreign firms have better governance than comparable U.S. firms....
Persistent link: https://www.econbiz.de/10012713137
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Why do Foreign Firms Leave U.S. Equity Markets?
Doidge, Craig - 2010
This paper investigates Securities and Exchange Commission (SEC) deregistrations by foreign firms from the time the Sarbanes-Oxley Act (SOX) was passed in 2002 through 2008. We test two theories, the bonding theory and the loss of competitiveness theory, to understand why foreign firms leave...
Persistent link: https://www.econbiz.de/10012715227
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Securities Laws, Disclosure, and National Capital Markets in the Age of Financial Globalization
Stulz, René M. - 2010
As barriers to international investment fall and technology improves, the cost advantages for a firm's securities to trade publicly in the country in which that firm is located and for that country to have a market for publicly traded securities distinct from the capital markets of other...
Persistent link: https://www.econbiz.de/10012715804
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Why do Foreign Firms Leave U.S. Equity Markets?
Doidge, Craig - 2010
Foreign firms terminate their SEC registration in the aftermath of the Sarbanes-Oxley Act (SOX) because they no longer require outside funds to finance growth opportunities. Deregistering firms' insiders benefit from greater discretion to consume private benefits without having to raise higher...
Persistent link: https://www.econbiz.de/10013149674