Market discipline in banking reconsidered
Subtitle: the roles of funding manager decisions and deposit insurance reform
By: Daniel M. Covitz, Diana Hancock, and Myron L. Kwast.
Contributors: Hancock, Diana.; Kwast, Myron L.
Series: Finance and economics discussion series ;; 2004-53; Finance and economics discussion series (Online) ;; 2004-53.
Publisher: Federal Reserve Board
Published: 2004
Place of publication: Washington, D.C
Language: eng
Format: Electronic resource
Description: "We find that the risk-sensitivity of bank holding company subordinated debt spreads at issuance increased with regulatory reforms that were designed to reduce conjectural government guarantees, but declined somewhat with subsequent reforms that were aimed in part at reducing regulatory forbearance.  In addition, we test and find evidence for a straightforward form of "market discipline:" The extent to which bond issuance penalizes relatively risky banks.  Evidence for such discipline only appears in the periods after conjectural government guarantees were reduced"--Federal Reserve Board web site.
Notes: Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 10/21/2004.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.