In this paper, we investigate whether financial shocks to firms affect their probability of bankruptcy. We also examine whether these shocks affect the natural selection of the firms, whereby more efficient firms are less likely to go bankrupt. By using the data on the bankruptcy of firms after...

We propose a framework under which one can analyze bank's securitization program in terms of firm value, leverage, and dividend payout. Our contributions are two-fold: (1) we provide an easy-to-use measure to see how the proceeds from asset sales are used, in particular focusing on the bank's...

The banks' forbearance lending to weak firms was one of primary reasons for the prolonged non-performing loan problem in Japan. We analyze whether regulatory arbitrage using lax enforcement of capital requirements was a motive for Japanese banks to continue loans to weak firms. We find evidence...

In this paper, we investigate whether a natural selection mechanism works for firm exit. By using data of firms after a devastating earthquake, the Great Tohoku Earthquake, we examine the impact of firm efficiency on firm exit both inside and outside the earthquake-affected areas. We find...