We investigate the cause of this banking crisis that has jeopardized the stability of the financial and economic system since the 1990s. Following Hanazaki and Horiuchi (2001), we argue that the deficiency of effective corporate governance of banks in Japan has caused inefficient management. Our...

The aim of this paper is to analyze the combined effect of both internal and external mechanisms on the performance of thirty European banks. This research uses a technique of panel data over the period 2004 to 2009. The results show that banks conduct trade-offs between different governance...

An effective bank resolution regime requires taking action while the bank still has positive net worth and shareholder claims still have economic value. Such actions raise a number of legal issues with respect to the rights of shareholders. This paper aims to consider how to strike a balance...

While executive compensation is often blamed for the excessive risk taking by banks, little is known about the operating performance incentives used in the finance industry both prior to and subsequent to the recent crisis. We provide a comprehensive analysis of incentive design -- the link of...

Based on the evidence after the outbreak of SARS in 2003, which is caused by the same family of viruses as COVID-19, we show that due to the “probability weighting” phenomenon, i.e., decision makers tend to overweight the probability of extreme tail events, the epidemic experience induces...

I examine large shareholders' externalities on other claim holders when firms are financially distressed. To this end, I develop a tractable dynamic model of the interplay between these blockholders and regular equity holders. Blockholders' information acquisition and investment decisions play a...

We present a model of an insolvent firm that may take advantage of a "soft-touch" government creditor in order to buy time before filing for reorganization, behavior we refer to as "claims substitution." Parameters in the model reflect the enforcement of absolute priority and government priority...

In this study we analyze the effect of split-share structure reforms on CEO turnover and performance relationship in Chinese listed firms. We use special dataset that manually categorizes a large number of CEO turnover events as either forced or non-forced. By employing logit regression and...

The present research paper aims to explore the corporate governance failures which acted as a reason for the crisis of 2008 and examine the possibility of creation of more effective corporate governance model by convergence. For the purpose of clarity and efficiency of the research, it focuses...

The financial crisis made apparent the fact that managers and the boards of banks had failed to see the implications of irrational behavior and had ignored the risk associated with group think. Taking data from Switzerland our study shows that there is an increasing homogeneity of management and...