In this paper, we examine whether the structure of the chief executive officer's (CEO) compensation package can explain default risk and performance in bank holding companies (BHCs) during the recent credit crisis. Using a sample of 371 BHCs, we show that in 2006 lower holdings of inside debt...

This paper shows that the liability classes most likely to exhibit evidence of market discipline during the recent financial crisis were uninsured depositors, insured depositors, and general creditors. We evaluate the FDIC's expectations about losses to creditors at banks that failed between...