This paper examines market discipline of Australian credit unions, and the impacts of the global financial crisis and the 2008 deposit guarantee scheme. The prior literature has focused on the market discipline of banks rather than credit unions. Using a unique sample of 204 Australian credit...

We describe a model in which bank deposits yield liquidity services and therefore earn a lower rate of return than equity. In this sense, deposits are a cheaper source of funding for banks than equity. The banks' equilibrium capital structure is determined by a trade off between the funding...

This paper shows that banks' cost of deposits increase following exposure to the Fintech sector. We exploit the exogenous, staggered removal of restrictions on investing through peer-to-peer lending platforms by US states. The entry of Lending Club and Prosper cause the cost of deposits to...

In November 2021, the President’s Working Group on Financial Markets (PWG) issued a report analyzing the rapid expansion and growing risks of the stablecoin market. PWG’s report determined that stablecoins pose a wide range of potential hazards, including the risks of inflicting large losses...

Due to the traditional operational model of cooperative banks which is mostly based on financial intermediation, the range of a local bank’s social influence in a given environment is highly dependent on the money transfer balance, that is using local money to satisfy local needs. A typical...

I study the relation between shadow banking and financial stability in an economy in which banks are susceptible to self-fulfilling runs and in which government-backed deposit insurance is limited. Shadow banks issue only uninsured deposits while commercial banks issue both insured and uninsured...

We employ proprietary data from a large bank to analyze how – in times of crisis – depositors react to a bank nationalization, re-privatization and an accompanying increase in deposit insurance. Nationalization slows depositors fleeing the bank, provided they have sufficient trust in the...

We look at market discipline in the Islamic deposit market of Turkey for the period after the 2000 crisis. We find support for quantity based disciplining of Islamic banks through the capital ratio. The evidence for price disciplining is, however, less convincing. In addition, we also look at...

Although it has been intensively claimed that Islamic banks are subject to more market discipline, the empirical literature is surprisingly mute on this topic. To fill this gap and to verify the conjecture that Islamic bank depositors are indeed able to monitor and discipline their banks, we use...

We study a bank run in India in which private bank branches experience sudden and considerable loss of deposits that seek safety in state-owned public sector banks (PSBs). We trace the consequences of this reallocation using granular data on bank- firm relationships and branch balance sheets....