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Depositor market discipline: New evidence from selling failed banks
,
Tim Zhou
International Review of Financial Analysis, Volume: 89, Start page: 102767
Swansea University Authors:
Vineet Upreti , Tim Zhou
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© 2023 The Authors. Published by Elsevier Inc. Distributed under the terms of a Creative Commons Attribution 4.0 License (CC BY 4.0).
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DOI (Published version): 10.1016/j.irfa.2023.102767
Abstract
This paper studies depositor behavior following the acquisition of failed banks by healthy banks in FDIC-supervised transactions. Using a US bank branch-based dataset spanning 2007 to 2014 we find that failed bank depositors discipline acquiring banks post-resolution. This appears to be related to f...
| Published in: | International Review of Financial Analysis |
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| ISSN: | 1057-5219 |
| Published: |
Elsevier BV
2023
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| Online Access: |
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| URI: | https://cronfa.swan.ac.uk/Record/cronfa63754 |
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| Abstract: |
This paper studies depositor behavior following the acquisition of failed banks by healthy banks in FDIC-supervised transactions. Using a US bank branch-based dataset spanning 2007 to 2014 we find that failed bank depositors discipline acquiring banks post-resolution. This appears to be related to features of the acquiring banks' asset quality and loan composition, but it may also be linked to irrational desciplinary behavior or post acquisition integration issues. We also find some evidence that depositor market discipline may have an impact on the competitive fetaures of local banking markets post resolution. |
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| Keywords: |
FDIC, Banks, Resolution, Market discipline, Depositors |
| College: |
Faculty of Humanities and Social Sciences |
| Funders: |
Swansea University |
| Start Page: |
102767 |