Asset Reclassifications and Bank Recapitalization During the Financial Crisis

Human Migration and Commercial Bank Risk During the Financial Crisis

Bank Holding Company Dividends and Repurchases during the Financial Crisis

Many large U.S. bank holding companies (BHCs) continued to pay dividends during the recent financial crisis, even as financial market conditions deteriorated, large losses accumulated, and emergency capital and liquidity were being provided by the official sector. In contrast, share repurchases by these BHCs dropped sharply in the early part of the crisis. Documenting this divergent behavior is...

Bank CEO Optimism and the Financial Crisis∗

I test theories of the recent financial crisis by studying how banks’ pre-crisis investments connect to their CEOs’ beliefs. Using different proxies for beliefs, I find banks with larger housing investments and worse crisis performance had CEOs who were more optimistic ex ante. Banks with the most optimistic CEOs experienced 20 percentage points higher real estate loan growth, and 15 percentage...

Bank Liquidity and the Global Financial Crisis

We investigate the stochastic dynamics of bank liquidity parameters such as liquid assets and nett cash outflow in relation to the global financial crisis. These parameters enable us to determine the liquidity coverage ratio that is one of themetrics used in ratio analysis to measure bank liquidity. In this regard, numerical results show that bank behavior related to liquidity was highly procyc...

Debt Deflation and Bank Recapitalization

During some recent financial crises, the majority of domestic banks or indeed the entire banking sector became insolvent. We have analyzed the welfare effects of policy responses to bank insolvency by examining a modified version of the Diamond-Rajan model, introducing a fiat currency. The sources of inefficiency in our model are the ”moral hazard in banking” and the “premature liquidation of b...