Advanced Search
MyIDEAS: Login to save this article or follow this journal

Preventing Systemic Crises through Bank Transparency

Contents:

Author Info

  • Ari Hyytinen
  • Tuomas Takalo

Abstract

The banking system is known to be vulnerable to self-fulfilling crises that are caused by depositors' co-ordination failure. We show that transparency regulation may prevent certain types of systemic crisis by eliminating the possibility of coordination failure. Copyright Banca Monte dei Paschi di Siena SpA, 2004

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.blackwell-synergy.com/servlet/useragent?func=synergy&synergyAction=showTOC&journalCode=ecno&volume=33&issue=2&year=2004&part=null
File Function: link to full text
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Banca Monte dei Paschi di Siena SpA in its journal Economic Notes.

Volume (Year): 33 (2004)
Issue (Month): 2 (07)
Pages: 257-273

as in new window
Handle: RePEc:bla:ecnote:v:33:y:2004:i:2:p:257-273

Contact details of provider:
Web page: http://www.blackwellpublishing.com/journal.asp?ref=0391-5026

Order Information:
Web: http://www.blackwellpublishing.com/subs.asp?ref=0391-5026

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Yuk-Shee Chan & Stuart I. Greenbaum & Anjan V. Thakor, 2004. "Is Fairly Priced Deposit Insurance Possible?," Finance, EconWPA 0411018, EconWPA.
  2. Billett, Matthew T. & Garfinkel, Jon A. & O'Neal, Edward S., 1998. "The cost of market versus regulatory discipline in banking," Journal of Financial Economics, Elsevier, Elsevier, vol. 48(3), pages 333-358, June.
  3. Ari Hyytinen, 2002. "The time profile of risk in banking crises: evidence from Scandinavian banking sectors," Applied Financial Economics, Taylor & Francis Journals, Taylor & Francis Journals, vol. 12(9), pages 613-623.
  4. Franklin R. Edwards & Frederic S. Mishkin, 1995. "The Decline of Traditional Banking: Implications for Financial Stabilityand Regulatory Policy," NBER Working Papers 4993, National Bureau of Economic Research, Inc.
  5. Jordan, John S. & Peek, Joe & Rosengren, Eric S., 2000. "The Market Reaction to the Disclosure of Supervisory Actions: Implications for Bank Transparency," Journal of Financial Intermediation, Elsevier, Elsevier, vol. 9(3), pages 298-319, July.
  6. John S. Jordan & Joe Peek & Eric S. Rosengren, 1999. "Impact of greater bank disclosure amidst a banking crisis," Working Papers, Federal Reserve Bank of Boston 99-1, Federal Reserve Bank of Boston.
  7. Douglas W. Diamond & Philip H. Dybvig, 2000. "Bank runs, deposit insurance, and liquidity," Quarterly Review, Federal Reserve Bank of Minneapolis, Federal Reserve Bank of Minneapolis, issue Win, pages 14-23.
  8. Bank for International Settlements, 2003. "Credit risk transfer," CGFS Papers, Bank for International Settlements, number 20.
  9. repec:fth:bfsefi:20/98 is not listed on IDEAS
  10. Hyytinen, A. & Takalo, T., 2000. "Enhancing Bank Transparency: a Re-assessment," University of Helsinki, Department of Economics, Department of Economics 492, Department of Economics.
  11. Lawrence H. Summers, 2000. "International Financial Crises: Causes, Prevention, and Cures," American Economic Review, American Economic Association, American Economic Association, vol. 90(2), pages 1-16, May.
  12. Reinhart, Carmen & Kaminsky, Graciela, 1999. "The twin crises: The causes of banking and balance of payments problems," MPRA Paper 14081, University Library of Munich, Germany.
  13. Herring, Richard J & Vankudre, Prashant, 1987. " Growth Opportunities and Risk-Taking by Financial Intermediaries," Journal of Finance, American Finance Association, American Finance Association, vol. 42(3), pages 583-99, July.
  14. Matutes, Carmen & Vives, Xavier, 2000. "Imperfect competition, risk taking, and regulation in banking," European Economic Review, Elsevier, Elsevier, vol. 44(1), pages 1-34, January.
  15. Boot, Arnoud W. A. & Schmeits, Anjolein, 2000. "Market Discipline and Incentive Problems in Conglomerate Firms with Applications to Banking," Journal of Financial Intermediation, Elsevier, Elsevier, vol. 9(3), pages 240-273, July.
  16. Bhattacharya, Sudipto & Boot, Arnoud W A & Thakor, Anjan V, 1998. "The Economics of Bank Regulation," Journal of Money, Credit and Banking, Blackwell Publishing, Blackwell Publishing, vol. 30(4), pages 745-70, November.
  17. Chiappori, Pierre-Andre & Perez-Castrillo, David & Verdier, Thierry, 1995. "Spatial competition in the banking system: Localization, cross subsidies and the regulation of deposit rates," European Economic Review, Elsevier, Elsevier, vol. 39(5), pages 889-918, May.
  18. Poon, Winnie P. H. & Firth, Michael & Fung, Hung-Gay, 1999. "A multivariate analysis of the determinants of Moody's bank financial strength ratings," Journal of International Financial Markets, Institutions and Money, Elsevier, Elsevier, vol. 9(3), pages 267-283, August.
  19. Williamson, Stephen D, 1986. "Increasing Returns to Scale in Financial Intermediation and the Non-neuturality of Government Policy," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 53(5), pages 863-75, October.
  20. Matutes, Carmen & Vives, Xavier, 1996. "Competition for Deposits, Fragility, and Insurance," Journal of Financial Intermediation, Elsevier, Elsevier, vol. 5(2), pages 184-216, April.
  21. María Soledad Martínez-Peria & Sergio Schmukler, 2002. "Do Depositors Punish Banks for Bad Behavior? Market Discipline, Deposit Insurance, and Banking Crises," Central Banking, Analysis, and Economic Policies Book Series, Central Bank of Chile, in: Leonardo Hernández & Klaus Schmidt-Hebbel & Norman Loayza (Series Editor) & Klaus Schmidt-Hebbel (S (ed.), Banking, Financial Integration, and International Crises, edition 1, volume 3, chapter 5, pages 143-174 Central Bank of Chile.
  22. Demirguc-Kunt, Asli & Detragiache, Enrica, 1997. "The determinants of banking crises : evidence from industrial and developing countries," Policy Research Working Paper Series 1828, The World Bank.
  23. Craine, Roger, 1995. "Fairly Priced Deposit Insurance and Bank Charter Policy," Department of Economics, Working Paper Series, Department of Economics, Institute for Business and Economic Research, UC Berkeley qt6dv142sd, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
  24. Giannetti, Mariassunta, 2003. " Bank-Firm Relationships and Contagious Banking Crises," Journal of Money, Credit and Banking, Blackwell Publishing, Blackwell Publishing, vol. 35(2), pages 239-61, April.
  25. Julapa Jagtiani & Catharine Lemieux, 1999. "Stumbling blocks to increasing market discipline in the banking sector: a note on bond pricing and funding strategy prior to failure," Emerging Issues, Federal Reserve Bank of Chicago, Federal Reserve Bank of Chicago, issue Sep.
  26. Jean-Charles Rochet & Jean Tirole, 1996. "Interbank lending and systemic risk," Proceedings, Board of Governors of the Federal Reserve System (U.S.), Board of Governors of the Federal Reserve System (U.S.), pages 733-765.
  27. Martinez Peria, Maria Soledad & Schmukler, Sergio L., 1999. "Do depositors punish banks for"bad"behavior? : market discipline in Argentina, Chile, and Mexico," Policy Research Working Paper Series 2058, The World Bank.
  28. Park, Sangkyun, 1995. "Market discipline by depositors: Evidence from reduced-form equations," The Quarterly Review of Economics and Finance, Elsevier, Elsevier, vol. 35(35), pages 497-514.
  29. Eduardo Levy Yeyati & Tito Cordella, 1997. "Public Disclosure and Bank Failures," IMF Working Papers 97/96, International Monetary Fund.
  30. Park, Sangkyun & Peristiani, Stavros, 1998. "Market Discipline by Thrift Depositors," Journal of Money, Credit and Banking, Blackwell Publishing, Blackwell Publishing, vol. 30(3), pages 347-64, August.
  31. João Cabral dos Santos, 1995. "Bank capital and equity investment regulations," Working Paper 9515, Federal Reserve Bank of Cleveland.
  32. Yehning Chen, 1999. "Banking Panics: The Role of the First-Come, First-Served Rule and Information Externalities," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 107(5), pages 946-968, October.
  33. Eric S. Rosengren, 1998. "Will greater disclosure and transparency prevent the next banking crisis?," Working Papers, Federal Reserve Bank of Boston 98-8, Federal Reserve Bank of Boston.
  34. Cordella, Tito & Yeyati, Eduardo Levy, 2002. "Financial opening, deposit insurance, and risk in a model of banking competition," European Economic Review, Elsevier, Elsevier, vol. 46(3), pages 471-485, March.
  35. Donald P. Morgan, 2002. "Rating Banks: Risk and Uncertainty in an Opaque Industry," American Economic Review, American Economic Association, American Economic Association, vol. 92(4), pages 874-888, September.
  36. Mayes, David & Vesala, Jukka, 1998. "On the Problems of Home Country Control," Research Discussion Papers, Bank of Finland 20/1998, Bank of Finland.
  37. J. Miguel Villas-Boas & Udo Schmidt-Mohr, 1999. "Oligopoly with Asymmetric Information: Differentiation in Credit Markets," RAND Journal of Economics, The RAND Corporation, vol. 30(3), pages 375-396, Autumn.
  38. Roger Craine., 1995. "Fairly Priced Deposit Insurance and Bank Charter Policy," Economics Working Papers, University of California at Berkeley 95-234, University of California at Berkeley.
  39. Stephen Morris & Hyun Song Shin, 2002. "Social Value of Public Information," American Economic Review, American Economic Association, American Economic Association, vol. 92(5), pages 1521-1534, December.
  40. Berlin, Mitchell & Saunders, Anthony & Udell, Gregory F., 1991. "Deposit insurance reform: What are the issues and what needs to be fixed?," Journal of Banking & Finance, Elsevier, Elsevier, vol. 15(4-5), pages 735-752, September.
  41. V.V. Chari & Ravi Jagannathan, 1984. "Banking Panics," Discussion Papers, Northwestern University, Center for Mathematical Studies in Economics and Management Science 618, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  42. Stole, Lars A, 1995. "Nonlinear Pricing and Oligopoly," Journal of Economics & Management Strategy, Wiley Blackwell, Wiley Blackwell, vol. 4(4), pages 529-62, Winter.
  43. Herring, Richard J, 1999. "Credit Risk and Financial Instability," Oxford Review of Economic Policy, Oxford University Press, Oxford University Press, vol. 15(3), pages 63-79, Autumn.
  44. Craine, Roger, 1995. " Fairly Priced Deposit Insurance and Bank Charter Policy," Journal of Finance, American Finance Association, American Finance Association, vol. 50(5), pages 1735-46, December.
  45. Niinimaki, J. -P., 2001. "Intertemporal diversification in financial intermediation," Journal of Banking & Finance, Elsevier, Elsevier, vol. 25(5), pages 965-991, May.
  46. Besanko, David & Thakor, Anjan V., 1992. "Banking deregulation: Allocational consequences of relaxing entry barriers," Journal of Banking & Finance, Elsevier, Elsevier, vol. 16(5), pages 909-932, September.
  47. Morris, Stephen & Shin, Hyun Song, 1999. "Risk Management with Interdependent Choice," Oxford Review of Economic Policy, Oxford University Press, Oxford University Press, vol. 15(3), pages 52-62, Autumn.
  48. Calomiris, Charles W & Kahn, Charles M, 1991. "The Role of Demandable Debt in Structuring Optimal Banking Arrangements," American Economic Review, American Economic Association, American Economic Association, vol. 81(3), pages 497-513, June.
  49. Donald P. Morgan, 1999. "Whether and why banks are opaque," Proceedings, Federal Reserve Bank of Chicago 636, Federal Reserve Bank of Chicago.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Nicole Allenspach, 2009. "Banking and Transparency: Is More Information Always Better?," Working Papers 2009-11, Swiss National Bank.
  2. J.-P. Niinimäki, 2012. "Optimal Design of Bank Bailouts: The Case of Prompt Corrective Action," Finnish Economic Papers, Finnish Economic Association, Finnish Economic Association, vol. 25(1), pages 1-19, Spring.
  3. Nier, Erlend W., 2005. "Bank stability and transparency," Journal of Financial Stability, Elsevier, Elsevier, vol. 1(3), pages 342-354, April.
  4. J-P. Niinimaki, 2011. "Optimal Design of Bank Bailouts: Prompt Corrective Action," Discussion Papers, Aboa Centre for Economics 69, Aboa Centre for Economics.
  5. Faidon Kalfaoglou & Alexandros Sarris, 2006. "Modeling the Components of Market Discipline," Working Papers, Bank of Greece 36, Bank of Greece.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:bla:ecnote:v:33:y:2004:i:2:p:257-273. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.