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This paper examines the potential distortion of prices in the CDS market caused by too-big-to-fail. Overall, we find evidence for market discipline in the CDS market. However, CDS prices are distorted due to a size effect which arises when investors expect a public bail-out as a result of...
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This study investigates the link between capital market discipline and bank-level credit risk with a special emphasis on the role of bank ownership structure. Focusing on a large emerging market, Türkiye, characterized by a prominent state bank presence, our baseline regression results indicate...
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Disclosure of information triggers immediate price movements, but it mitigates price movements at a later date, when … the information would otherwise have become public. Consequently, disclosure shifts risk from later cohorts of investors … to earlier cohorts. Hence, disclosure policy can be interpreted as a tool to control interim asset price movements, and …
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