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Working Paper
Financial liberalization, market discipline and bank risk
In the literature on systemic banking crises, two common themes are: (1) Risky lending often follows bank liberalization. (2) Lack of market discipline encourages risky lending. That not all liberalizations are followed by financial crisis and that financial systems without market discipline sometimes operate without incident invites examination of these themes. In a test of six countries, we find that our measure of bank risk increases significantly in the wake of financial liberalizations, but only where depositors fail to discipline banks. Our measures of market discipline and bank risk, ...
Working Paper
When does financial liberalization make banks risky? an empirical examination of Argentina, Canada and Mexico
In the literature on systemic banking crises, two common themes are: (1) lack of market discipline encourages risky lending and (2) financial liberalization or privatization lead to risky lending. However, there is evidence to suggest that neither financial liberalization nor weak market discipline always precedes risky lending. We test for depositor discipline and, separately for post-liberalization or post-privatization risky lending in Argentina, Canada, and Mexico. In the countries without market discipline, lending risk increases significantly in the wake of liberalization. Where ...
Journal Article
Banks as real estate brokers -- letting free enterprise work
Journal Article
Small banks' competitors loom large
Report
Texas Banks Enter This Downturn on Better Footing
The oil price plunge that began in mid-2014 is reminiscent of the state?s big bust nearly three decades ago, when oil prices declined more than 70 percent in real terms.