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Although the cost of financial distress is a central issue in capital structure and credit risk studies, reliable estimates of its size are difficult to come by. This paper proposes a novel method of extracting the cost of default from the change in the market value of a firm's assets upon...
Persistent link: https://www.econbiz.de/10010206258
For nearly two years, the two of us have had a running discussion of the costs and benefits of automatic stays in bankruptcy for qualified financial contracts (QFCs) such as derivatives and repurchase agreements, particularly those held by systemically important major dealer banks. Under current...
Persistent link: https://www.econbiz.de/10009504439
This paper uses a two-step methodology to examine the relationship between managerial cost inefficiency and the takeover of U.S. thrifts during a period of market liberalization and widespread takeover activity, 1994 to 2000. In the first stage using stochastic cost frontiers, controllable...
Persistent link: https://www.econbiz.de/10013004388
goal of this paper is to investigate the change in operating performance, efficiency, and value addition of US bank mergers … examine the factors that have significant impact on changes in bank performance. Our empirical results lead to the conclusion … adjusted performance more than product focused mergers. The efficiency or profitability of targets have either a positive or no …
Persistent link: https://www.econbiz.de/10012964750
Using firm-level data from surveys and financial statements, this paper presents an analysis of credit standards, capital allocation and financial conditions of non-financial enterprises in Denmark since the beginning of the financial crisis. The analysis indicates that low interest rates and...
Persistent link: https://www.econbiz.de/10011489436
impact of income, asset, and funding diversifications on the cost and profit efficiency of the US commercial banks over the …) effect on the cost efficiency of the banks, while funding (income) diversification has a significantly negative (positive …) effect on profit efficiency. Our findings reveal that during the global financial crisis asset diversification is not …
Persistent link: https://www.econbiz.de/10013223117
for convergent clusters in banking efficiency. Findings - Our main findings show that the bank efficiency of the US is …Purpose - This paper investigates the development of efficiency and the progress of banking integration in the European … bootstrap DEA method, which absorbs the effects of possible integration barriers in the measurement of efficiency. Afterwards …
Persistent link: https://www.econbiz.de/10012887337
in the efficiency and productivity of U.S. banks between 1985 and 2004. We find that larger banks experienced larger … efficiency and productivity gains than small banks, consistent with the presumption that recent changes in regulation and …
Persistent link: https://www.econbiz.de/10014057323
When borrowers are delinquent, senior debtholders prefer liquidation whereas junior debtholders prefer to maintain their option value by delaying resolution or modifying the loan. In the mortgage market, a conflict of interest (“holdup”) arises when servicers of securitized senior liens are...
Persistent link: https://www.econbiz.de/10010353293
weather conditions. This paper provides the theoretical framework to study the impact of weather through its influence on bank … manager's mood on bank inefficiency. In particular, we provide empirical evidence of the dynamic interactions between weather … and bank loan inefficiency, using a panel data set that includes 69 banks operating in the US spanning the period 1994 to …
Persistent link: https://www.econbiz.de/10009565392