We examine debenture yields over the period 1983-91 to evaluate the market's sensitivity to bank-specific risks, and conclude that investors have rationally reflected changes in the government's policy toward absorbing private losses in the event of a bank failure. Although this evidence does...

An important question for bank regulatory policy is whether supervisory examinations of large commercial banking firms - institutions that are already actively followed by many investors and their private sector agents - produce useful information that is not already reflected in market prices....

Silicon Valley Bank (SVB) failed on March 10, 2023, from a depositor run set off by massive unbooked securities losses that became salient only when the firm filed for a stock issue intended to replace some realized, but previously un-noticed, capital losses. The unprecedented increase in market...

Large commercial banking firms are monitored by specialized private sector monitors and by specialized government examiners. Previous research suggests that bank exams produce little useful information that is not already reflected in market prices. In this article, we apply a new research...