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I Will Survive. Pricing Strategies of Financially Distressed Firms

Duca, Ioana - 2018

We consider a standard result of customer market theory: if firms have stable customer relations and face financial frictions, they may keep prices relatively high on their locked-in shoppers to maintain short-term profits at the expense of future market shares in times of low demand and vice...

Persistent link: https://www.econbiz.de/10012916150

Bank-Firm Relationships and the Survival of Non-Financial Firms During the Financial Crisis 2008-2009

Abildgren, Kim - 2013

Utilising a unique data set with annual accounts from around 37,000 Danish non-financial firms spanning almost one and a half decade, we offer microeconometric evidence on bankfirm relationships and the survival of firms during the financial crisis 2008-9. Within the framework of...

Persistent link: https://www.econbiz.de/10013086885

Latent Fragility : Conditioning Banks' Joint Probability of Default on the Financial Cycle

Bochmann, Paul; Hiebert, Paul; Schüler, Yves; … - 2022

We propose the CoJPoD, a novel framework explicitly linking the cross-sectional and cyclical dimensions of systemic risk. In this framework, banking sector distress in the form of the joint probability of default of financial intermediaries (reflecting contagion from both direct and indirect...

Persistent link: https://www.econbiz.de/10013403523

The Economic Impact of Merger Control : What is Special about Banking?

Carletti, Elena; Hartmann, Philipp; Ongena, Steven - 2021

-oriented regime for merger control increases banks' stock prices, whereas it decreases those of non-financial firms. Moreover, bank … merger targets become more profitable and larger. A major determinant of the positive bank returns, after controlling inter … institutional setup for supervisory bank merger reviews. Thus strengthening competition policy in banking may generate positive …

Persistent link: https://www.econbiz.de/10013316912

Organisational Structure as a Driver of Mergers and Acquisitions in the European Banking Sector

Lebastard, Laura - 2022

This paper studies the bilateral drivers of mergers and acquisitions (M&As) between European banks. Two findings document that banks use M&A as a device to leverage their expertise rather than to diversify. (i) Following the literature on matrimonial matching by using a binary logit model, the...

Persistent link: https://www.econbiz.de/10013405075

Breaking the Shackles : Zombie Firms, Weak Banks and Depressed Restructuring in Europe

Andrews, Dan - 2019

insolvency regimes do not unduly inhibit corporate restructuring. Thus, leveraging the important complementarities between bank … strengthening efforts and insolvency regime reform would contribute to breaking the shackles on potential growth in Europe …

Persistent link: https://www.econbiz.de/10012892781

Forbearance vs Foreclosure in a General Equilibrium Model

Barbaro, Bianca; Tirelli, Patrizio - 2021

We build a business cycle model characterized by endogenous firms dynamics, where banks may prefer debt renegotiation, i.e. non-performing exposures, to outright borrowers default. We find that debt renegotiations only do not have adverse effects in the event of financial crisis episodes, but a...

Persistent link: https://www.econbiz.de/10013239325

Limited Liability, Strategic Default and Bargaining Power

Balatti, Mirco; López-Quiles, Carolina - 2021

In this paper we examine the effects of limited liability on mortgage dynamics. While the literature has focused on default rates, renegotiation, or loan rates individually, we study them together as equilibrium outcomes of the strategic interaction between lenders and borrowers. We present a...

Persistent link: https://www.econbiz.de/10013243789

Monetary Policy and the Financing of Firms

De Fiore, Fiorella - 2012

How should monetary policy respond to changes in financial conditions? In this paper we consider a simple model where firms are subject to idiosyncratic shocks which may force them to default on their debt. Firms' assets and liabilities are denominated in nominal terms and predetermined when...

Persistent link: https://www.econbiz.de/10013116576

Credit Risk in General Equilibrium

Eichberger, Jürgen - 2012

Credit risk models used in quantitative risk management treat credit risk analysis conceptually like a single person decision problem. From this perspective an exogenous source of risk drives the fundamental parameters of credit risk: probability of default, exposure at default and the recovery...

Persistent link: https://www.econbiz.de/10013105310