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Journal Article
Small California banks holding on
Working Paper
Lending in low- and moderate-income neighborhoods in California: the performance of CRA lending during the subprime meltdown
The current scale of mortgage delinquencies and foreclosures - particularly in the subprime market - has sparked a renewed debate over the Community Reinvestment Act (CRA) and the regulations governing home mortgage lending. On one side, detractors argue that the CRA helped to precipitate the current crisis by encouraging lending in low- and moderate-income neighborhoods (Walker 2008). On the other side, advocates of the CRA point to a number of reasons why the regulation shouldn?t be blamed for the current subprime crisis. ; What has been missing in this debate has been an empirical ...
Journal Article
The shrinking of Japanese branch business lending in California
Journal Article
Changes in the structure of urban banking markets in the West
This paper begins with a discussion of the influence of the number of firms and the variance of market shares on the Herfindahl-Hirschman Index (HHI) measure of market concentration. ; The paper then reports the changes in the number of depository institutions (DIs) and in the HHI in the Twelfth District and its 65 individual urban banking markets between 1982 and 1992, attributing these changes to underlying causes. I find that, although an increase in concentration need not accompany a decrease in firms, more than two-thirds of the 53 markets with DI decreases showed concentration ...
Journal Article
On the portfolio effects of financial convergence - a review of the literature
This paper reviews the literature on the effects of combining banking and nonbank financial activities on banking organizations' risk and return. In general, securities activities, insurance agency, and insurance underwriting are all riskier and more profitable than banking activities. They also have the potential to provide diversification benefits to banking organizations. While real estate agency, title abstract activities, and real estate operation are more profitable than banking, real estate development may not be. Real estate activities are riskier than banking activities in ...
Journal Article
Small businesses hit hard by weak job gains
Small businesses have historically contributed more than their share to overall employment growth in the United States. But during the recent recession, the rate of net employment losses of small businesses exceeded that of larger businesses. Sharp cuts in the rate of gross job gains at small businesses appear to have been a major factor explaining the larger net employment losses for this group. The drop in the rate of job gains reflected slower business creation and a lower rate of hiring among expanding small businesses.
Journal Article
Mortgage prepayment: an avenue foreclosed?
When the housing boom of the past decade turned into a bust, falling house prices played a primary role in driving up delinquency and foreclosure rates. As housing values fell, distressed borrowers lost equity, which hindered their ability to escape delinquency by prepaying their mortgages by refinancing or selling their homes. Falling house prices may have especially impinged on subprime and adjustable-rate borrowers. These homeowners may have counted on being able eventually to refinance into loans with terms more affordable than those of their original mortgages.
Journal Article
The geographic scope of small business lending: evidence from the San Francisco market
Historically, small businesses have tended to turn to local lenders for credit. In recent years, however, technological advances in processing information and assessing credit risk have raised the potential for loosening the geographic ties between small business borrowers and lenders. This Economic Letter discusses factors affecting the geographic scope of markets for small business credit and uses data available for the San Francisco Bay Area to examine the extent to which small businesses rely on local lenders, how this reliance has changed over time, and the implications of any changes ...
Journal Article
Small business lending and bank competition
This Economic Letter examines what the data say about the relationship between the degree of competition in and total volume of small business lending in local geographic banking markets.