We estimate a structural model of bank portfolio lending and find that the typical U.S. community bank reduced its business lending during the global financial crisis. The decline in business credit was driven by increased risk overhang effects (consistent with a reduction in the liquidity of...

We test whether income from nontraditional banking activities contributed to the failures of hundreds of U.S. commercial banks during the financial crisis. Estimates from a multi-period logit model indicate that the probability of distressed bank failure declined with pure fee-based...

There is general agreement among bank researchers that revenues from fee-based activities are more volatile than revenues from more traditional interest-based (loans and deposits) activities. We test whether noninterest income was a determining factor in the hundreds of U.S. commercial bank...