This study provides direct evidence of the value to banks arising from relationship lending by estimating the market premium placed on banking organizations' small business loan portfolios. Using data from the small business loan survey contained in the June bank Call Reports, we find that small...

US Interstate bank deregulation during the 1980s and 1990s led to larger, nationally diversified banks, and a decline in the number of local community banks. Economic theory suggests that community banks may have a greater incentive, but a lower capacity, to lend to a region following a...

Although small and medium-sized enterprises (SMEs) contribute considerably to Germany's carbon emissions, regional savings and cooperative banks - SMEs' most important financiers - hardly consider this aspect in lending to these businesses. However, given Germany's commitment to climate...

The decline in cash use and growing use of digital distribution for retail banking leads to a reduced need for bank branches. Lending to small and medium sized firms (SMEs) has not benefited as much from a digital transformation, and widespread branch closures may reduce their supply of credit....

This paper studies empirically the relationship between competition and risk taking in banking markets. We exploit an unique dataset providing information about all bank loans to Norwegian firms over several years. Rather than relying on observed market shares, we use the distance between bank...

Using weekly confidential data from U.S. banks, we document an unprecedented flight to safety of deposits from regional banks towards large banks in the early 2023. We show that large banks experienced large deposit inflows relative to small and regional banks and that these differences remain...

This Study examines the impact of local bank structures on the expansion of foreign banks by combining data from China and theory analysis of domestic and foreign bank competition. Results show that when foreign banks face banking structures with a higher proportion of banks with low funding...

During the 2010s, the number of community banks in the United States declined by almost one-third, a trend that has worried many stakeholders including communities losing their primary bank, regulators, and the industry itself. This paper provides evidence that the disappearance of community...

This paper uses a simulation model to evaluate the effects of river flooding events occurring within Germany on regional' banks. Under a 1.5℃ increase in temperature, the impact is overall rather small, even accounting for the devaluation of loans exposed to floods. However, under a 3℃...

This paper studies empirically the relationship between competition and risk taking in banking markets. We exploit an unique dataset providing information about all bank loans to Norwegian firms over several years. Rather than relying on observed market shares, we use the distance between bank...

This study investigates the role of local small and medium-sized banks in stabilizing the local economy and assesses whether higher levels of local government debt hinder this effect. Using panel data on local small and medium-sized banks and local government debt from 31 Chinese provinces...

This study examines loan loss provisions following top executive turnovers in Japanese banks. The study differentiates between voluntary and forced turnover and inside and outside succession. The results show that incoming top executives, following forced turnover or outside succession, tend to...

To determine how much further the regional bank stocks could fall before reaching equilibrium, we look from February 28, 2023, to April 30, 2023, at a sample of 300+ regional banks that experienced a nearly 25% reduction in Market-to-Book ratios using our Valulytics® bank valuation model. We...

Die aktuelle Krise einiger amerikanischer und europäischer Banken löst zwangsläufig Befürchtungen aus, dass eine internationale Bankenkrise zu einer neuen Finanzkrise führen könnte. Doch sind die Vorzeichen im Jahre 2023 ganz andere als im Jahre 2007/2008. Anders als vor 15 Jahren wirkt...

Over 2010-2016, municipal debt in Germany crowded out private investment worth 1 percent of GDP. Forced to lend to municipalities by their statutes, local public banks compensated for declining municipal-debt yields by charging higher rates to firms in Germany’s locally segmented credit...

This paper investigates whether and how high-speed rail (HSR) construction affects local bank performance. Using the difference-in-difference method, we find that the city commercial banks (CCBs) significantly experience an overall decrease in ROA after HSR is introduced in the headquarters...

To deal with the deep recession since the asset bubble burst in the early 1990s, the Bank of Japan (BOJ) adopted numerous unconventional policy measures, such as zero-interest-rate policy, quantitative easing, and yield curve control, ahead of other countries. Moreover, the BOJ has been pursuing...

We examine the immediate impacts of COVID-19 on FDIC chartered banks’ performance. Our experimental design analyzes the performance of community banks and large banks before and during the COVID-19 pandemic. Community banks outperform large banks significantly in several key measures in the...

Using a rare flood in April 2019 in Iran as a natural experiment, we study the role of local banks in mitigating the financial consequence of natural disasters to smallholder farmers. We find that local branches immediately react to the disaster by increasing their lending for two months...

Some regional banks are highly exposed to flood risk. Yet, there is little evidence that banks manage these exposures. The lack of flood risk management in these banks could worsen the adverse local economic impact of a flood. Therefore, banks should incorporate flood risk in their risk management.

The Saudi Central Bank (SAMA) is entrusted with issuing a shariah governance framework for local banks operating in Saudi Arabia.This framework ensures the activation of supervisory regulations on Islamic banking as a first phase, in which SAMA establishes supervisory frameworks for banks that...

We develop a measure of climate transition risk for regional economies in the US, based on the mix of firms that produce emissions in each region. To quantify transition risks, we consider the introduction of an emissions tax levied on companies emitting greenhouse gases and estimate changes in...