Hub-and-Spoke Regulation and Bank Leverage

Autor:	Yadav Gopalan, Asaf Manela, Ankit Kalda
Rok vydání:	2021
Předmět:	Finance Economics and Econometrics Delegate Supervisor business.industry media_common.quotation_subject Financial regulation Leverage (negotiation) Accounting Cash Agency (sociology) Closure (psychology) business Communication channel media_common
Zdroj:	Review of Finance. 25:1499-1545
ISSN:	1573-692X 1572-3097
DOI:	10.1093/rof/rfab019
Popis:	Regulators often delegate monitoring to local supervisors, which can improve information collection, but can also lead to agency problems and capture. We document that following the closure of a US bank regulator’s field offices, the banks they previously supervised actively increased their risk of failure by distributing cash, increasing leverage, and lending more than similar banks at the same time and place. Supervisor proximity is a channel through which these effects operate. Our findings suggest that local supervision is an important part of regulation, as it facilitates collection of information imperfectly reflected in reported measures, and that switching from onsite to offsite supervision can increase bank risk.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::2901c60cf5450036113cffb1b99a75b1 https://doi.org/10.1093/rof/rfab019 Zobrazit plný text záznamu Plný text ve formátu PDF Plný text ve formátu HTML
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