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the resulting drop in bank charter values translated into higher risk-taking at German savings banks. -- Public bail-out …
Persistent link: https://www.econbiz.de/10009664941
The possibility of creating a state bank has received much recent attention in the United States. In 2021, six states introduced legislation to create a state bank; in 2019, similar legislation was enacted in California for municipal banks. This paper develops a framework to evaluate state...
Persistent link: https://www.econbiz.de/10013454018
likelihood of a bank bailout or failure during the late 2000s financial crisis. The empirical results indicate that established … received bailout funds are similar except that holding a large proportion of nonperforming loans reduced the likelihood that a … bank received bailout funds. Overall, these results are consistent with regulators providing bailout funds to banks that …
Persistent link: https://www.econbiz.de/10013008003
The bail-in tool as implemented in the European bank resolution framework suffers from severe shortcomings. To some extent, the regulatory framework can remedy the impediments to the desirable incentive effect of private sector involvement (PSI) that emanate from a lack of predictability of...
Persistent link: https://www.econbiz.de/10011720767
In this paper, we construct a structural model to determine the costs of a bank rescue considering bail-outs and bail-ins. In our model, a government assumes the equity stake under unlimited liability upon abandonment of the original equity holders. The model determines an abandonment trigger...
Persistent link: https://www.econbiz.de/10011745783
Persistent link: https://www.econbiz.de/10013541749
Using a unique data set based on US commercial banks and county level loan origination for the period 2005-2010, we measure whether banks that benefited from the Troubled Asset Relief Program (TARP) increase small business loan originations. We propose an identification strategy which exploits...
Persistent link: https://www.econbiz.de/10011410414
How should regulators design effective emergency lending facilities to mitigate stigma during a financial crisis? I explore this question using data from an unexpected disclosure of partial lists of banks that secretly borrowed from the lender of last resort during the Great Depression. I find...
Persistent link: https://www.econbiz.de/10011708103
Persistent link: https://www.econbiz.de/10003730956