During the global financial crisis, a large number of banks worldwide either failed or received financial aid thus inflicting substantial losses on the system. We contribute to the early warning [...]
The implementation of tighter regulation and more powerful supervision may impose large social costs due to the strong reliance on supervisory information that requires direct assessment by a supervisor (i.e. [...]
Syndication increases the overlap of bank loan portfolios and makes them more vulnerable to contagious effects. We develop a novel measure of bank interconnectedness using syndicated corporate loan portfolios, overlap [...]
Bond issuers and rating agencies realized that ratings had become a device for determining whether many institutional investors could legally purchase particular fixed income securities. Because ratings now provided a [...]
From 1973 to 2014, the common stock of U.S. banks with loan growth in the top quartile of banks over a three-year period significantly underperforms the common stock of banks [...]
Did the Dodd-Frank Act end “too big to fail”? In a pair of blog posts published in 2015, we argued that, at the time, bond and [credit default swap] CDS [...]
If bond investors agree that SPOE [single point of entry, where parent companies are responsible for the losses of failing subsidiaries] has made the parent riskier, we should see the [...]
Nonbanks originated about half of all mortgages in 2016, and 75% of mortgages insured by the FHA or VA. Both shares are much higher than those observed at any point [...]
We examine the payoff performance, up to the end of 2013, of non-agency residential mortgage-backed securities (RMBS), issued up to 2008. We have created a new and detailed data set [...]
This study investigates how the political connections of government bank CEOs affected their banks’ performance during the 2007–2009 financial crisis. Examination of global data shows that government banks with politically [...]