The death of a regulator: Strict supervision, bank lending, and business activity

IF 10.4 1区 经济学 Q1 BUSINESS, FINANCE Journal of Financial Economics Pub Date : 2024-06-07 DOI:10.1016/j.jfineco.2024.103871
João Granja , Christian Leuz
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Abstract

We exploit the extinction of the thrift supervisor (OTS) to analyze the effects of supervision on bank lending and bank management. We first show that the OTS replacement resulted in stricter supervision of former OTS banks. Next, we analyze the ensuing lending effects and show that former OTS banks on average increase small business lending by roughly 10 percent. This increase is concentrated in well-capitalized banks and especially in banks that changed management practices following the supervisory transition. These findings suggest that stricter supervision operates not only through the enforcement of loss recognition and capital adequacy, but can also act as a catalyst for operational changes that correct deficiencies in bank management and lending practices, which in turn increase lending.

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监管者之死严格监管、银行贷款和商业活动
我们利用储蓄监管机构(OTS)的消亡来分析监管对银行贷款和银行管理的影响。我们首先表明,取代 OTS 后,对前 OTS 银行的监管更加严格。接下来,我们分析了随之而来的贷款效应,结果表明前 OTS 银行的小企业贷款平均增加了约 10%。这种增长主要集中在资本充足的银行,尤其是在监管过渡后改变了管理方法的银行。这些研究结果表明,更严格的监管不仅可以通过执行损失确认和资本充足率来发挥作用,而且还可以成为业务变革的催化剂,从而纠正银行管理和贷款实践中的缺陷,进而增加贷款。
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来源期刊
CiteScore
15.80
自引率
4.50%
发文量
192
审稿时长
37 days
期刊介绍: The Journal of Financial Economics provides a specialized forum for the publication of research in the area of financial economics and the theory of the firm, placing primary emphasis on the highest quality analytical, empirical, and clinical contributions in the following major areas: capital markets, financial institutions, corporate finance, corporate governance, and the economics of organizations.
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