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Depositor responses to a banking crisis: Are finance professionals special?

Author

Listed:
  • Boyle, Glenn
  • Stover, Roger
  • Tiwana, Amrit
  • Zhylyevskyy, Oleksandr

Abstract

We use a conjoint analysis of 551 subjects to compare the reaction of finance professionals to news of a banking crisis with the reactions of non-finance professionals and graduate students. All three groups make greater deposit withdrawals if deposit insurance protection involves a haircut, but the response of finance professionals is more nuanced: compared to non-finance professionals and students, they seem to care about haircuts mainly when bank capitalization is low and less so when capitalization is high. Both finance and non-finance professionals are more concerned about the pre-funding of deposit insurance than are students. Overall, while our results seem to indicate that finance professionals might be more financially savvy, they also suggest that the crisis-response behavior of finance professionals does not differ substantively from that of the other two groups.

Suggested Citation

  • Boyle, Glenn & Stover, Roger & Tiwana, Amrit & Zhylyevskyy, Oleksandr, 2022. "Depositor responses to a banking crisis: Are finance professionals special?," Journal of Empirical Finance, Elsevier, vol. 67(C), pages 182-195.
    • Handle: RePEc:eee:empfin:v:67:y:2022:i:c:p:182-195
    DOI: 10.1016/j.jempfin.2022.03.004
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    More about this item

    Keywords

    Banking crisis; Finance professionals; Deposit withdrawals;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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