Publicação

Determinants of European Banks’ bailouts following the 2007–2008 financial crisis

Ver documento

Detalhes bibliográficos
Resumo:Extraordinary amounts of public funds and/or assistance were made available to banks since the onset of the 2007–8 financial crises. Governments worldwide have launched a massive bailout package to support banks in distress. Using a probit model, this article investigates the likelihood of bailouts following the financial crisis. Our results lead us to conclude that the governance characteristics of banks, specifically the characteristics of boards, bank risks, as well as bank-level and country-specific banking sector features, explain the likelihood of bailouts in the European banking sector. In particular, we find that board banking experience, longer directors’ tenure, less busy boards, and the existence of a corporate governance committee decrease the likelihood of banks participating in a bailout programme. Inversely, board independence, credit, and liquidity risks increase the probability of banks being bailed out. Furthermore, fewer limitations on banking freedom and greater openness of the banking sector have a harmful impact on the occurrence of bailouts. Our study therefore suggests relevant policy implications, which might help supervisors, regulators, and other public authorities in avoiding costly bailouts.
Autores principais:Fernandes, Catarina
Outros Autores:Farinha, Jorge; Martins, Francisco Vitorino; Mateus, Cesário
Assunto:Corporate governance Banks Financial crisis Risk Bailouts
Ano:2016
País:Portugal
Tipo de documento:artigo
Tipo de acesso:acesso aberto
Instituição associada:Instituto Politécnico de Bragança
Idioma:inglês
Origem:Biblioteca Digital do IPB

Registos relacionados

Registos relacionados