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In this paper, we investigate the damage to real-sector investment spending and corporate financing activities triggered by the failure of three major investment banks during the 2007-09 financial crisis. We find that firms characterized by pre-crisis corporate investment banking relationships...
Persistent link: https://www.econbiz.de/10010410832
We evaluate changes in investment bank balance sheets during financial crises to determine how these firms respond to funding shocks. Most investment banks maintain funding levels during these downturns, suggesting that liquidity shocks are not a trigger for their financial troubles. Among the...
Persistent link: https://www.econbiz.de/10012974535
This paper uses new data on the timing of sovereign defaults during 1869-1914 to quantify an informational channel of contagion via shared financial intermediaries. Concerns over reputation incentivized Britain's merchant banks to monitor, advise, and occasionally bail out sovereigns. Default...
Persistent link: https://www.econbiz.de/10012902171
This paper develops a model of financial institutions that borrow short term and invest in longterm assets that can be traded in frictionless markets. Because these financial intermediaries perform maturity transformation, they are subject to potential runs. We derive distinct liquidity,...
Persistent link: https://www.econbiz.de/10010201349
Persistent link: https://www.econbiz.de/10003846450
Media often portray investment bankers as the culprits of the global financial crisis, while mainstream scholarly accounts blame government failures and global trade and financial imbalances. This paper investigates the role of investment banks in the global financial crisis and the US economy,...
Persistent link: https://www.econbiz.de/10013128011
This paper develops an infinite-horizon model of financial institutions that borrow short-term and invest in long-term assets that can be traded in frictionless markets. Because these financial intermediaries perform maturity transformation, they are subject to potential runs. We derive distinct...
Persistent link: https://www.econbiz.de/10010200411
The Term Securities Lending Facility (TSLF) lent $2.3 trillion worth of general collateral to eighteen investment houses in exchange for riskier securities. Treasury collateral was in high demand in 2008 and 2009 as repo markets shunned lower quality collateral. This paper finds a negative and...
Persistent link: https://www.econbiz.de/10013108751
The competitive landscape and business structure of global investment banks has changed fundamentally following the 2008 global financial crisis(GFC). With the bankruptcy, acquisition or shift to bank holding companies of the leading pure investment banks, such as Lehman Brothers, Merrill Lynch,...
Persistent link: https://www.econbiz.de/10013292228
This paper looks at the development of the banking sector in emerging East Asia in the 10 years since the financial crisis of 1997/98. It suggests that the health of banking sectors in the region has improved substantially, with key changes including increased foreign ownership, movement into...
Persistent link: https://www.econbiz.de/10010507462