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Catch, restrict, and release: the real story of bank bailouts
Berger, Allen N.; Nistor, Simona; Ongena, Steven; … - 2020
Bank bailouts are not the "one-shot" events commonly described in the literature. These bailouts are instead dynamic processes in which regulators "catch" financially distressed banks; "restrict" their activities over time; and "release" the banks from restrictions at sufficiently healthy capital...
Persistent link: https://www.econbiz.de/10012224131
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Recapitalization, bailout, and long-run welfare in a dynamic model of banking
Modena, Andrea - 2020 - This Version: 14th October 2020
bailout policies may benefit social welfare in the long-run. Bailouts improve capital allocation in states where aggregate …
Persistent link: https://www.econbiz.de/10012300552
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A structural model to assess the impact of bank capitalization changes conditional on a bail-in versus bail-out regime
Groß, Marco; Dubiel-Teleszynski, Tomasz; Población, Javier - 2018
bailout, the bailout value incurred by the government following the abandonment of the private shareholders, and, moreover … particular on assessing the difference that an assumed bail-in as opposed to bail-out regime can make. …
Persistent link: https://www.econbiz.de/10011910725
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Bailouts and Moral Hazard : How Implicit Government Guarantees Affect Financial Stability
Mariathasan, Mike - 2014
The recent crisis has shown that systemically relevant banks in distress are likely to benefit from governmental support. This reduces their downside risk and leads to moral hazard, i.e. to incentives for these banks to assume excessive risks. In this paper we show empirically that implicit...
Persistent link: https://www.econbiz.de/10013049033
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Bank Bailouts, Bail-Ins, or No Regulatory Intervention? A Dynamic Model and Empirical Tests of Optimal Regulation
Berger, Allen N.; Himmelberg, Charles P.; Roman, Raluca A. - 2020
default { bailout, where government provides capital; bail-in, using private-sector funds; and no regulatory intervention … distress with sufficient capital remaining. Empirical tests of changes in capital behavior from the pre-crisis bailout period …
Persistent link: https://www.econbiz.de/10012852290
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Bank Bailouts and Competitive Distortions
Cardillo, Giovanni; Fiordelisi, Franco; Ricci, Ornella - 2023
Past papers show that public bailouts increase the moral hazard of rescued banks. What happens to other banks in the banking sector? Using a hand-collected dataset of European banks from 2007 to 2017 and adopting a dynamic difference-in-differences approach, we document that public bailouts...
Persistent link: https://www.econbiz.de/10014362236
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What Can a Discretionary Bailout Policy Do to Stabilize a Banking System after a Systemic Credit Event?
Steinbacher, Matjaz - 2013
We study the stability of the banking system after a mortgage shock when a discretionary bailout policy is applied … the alternatives for most shock/bailout pairs. The medium-sized banks policy performs the worst and may be feasible only … for a small number of low shock/low bailout probability pairs. We identify a threshold level after which the bailout costs …
Persistent link: https://www.econbiz.de/10013072678
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Common (Stock) Sense About Risk-Shifting and Bank Bailouts
Wilson, Linus - 2010
If a bank is facing insolvency, it will be tempted to reject good loans and accept bad loans so as to shift risk onto its creditors. We analyze the effectiveness of buying up toxic mortgages in troubled banks, buying preferred stock, and buying common stock. If bailing out banks deemed “too...
Persistent link: https://www.econbiz.de/10013142103
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Capital injection to banks versus debt relief to households
Yoo, Jinhyuk - 2017
House financing has played a prominent role in advanced economies. In addition, most of the banking crises in advanced economies were associated with boom-bust cycles in house prices. Prominent researchers suggest that more grants for household debt reduction would have provided a significant...
Persistent link: https://www.econbiz.de/10011635333
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Policy uncertainty and bank bailouts
Caliendo, Frank; Guo, Nick L.; Smith, Jason M. - In: Journal of financial markets 39 (2018), pp. 111-125
Persistent link: https://www.econbiz.de/10012001892