This paper examines the pivotal role of Nicola Miraglia in steering the Banco di Napoli through a tumultuous period of economic crisis and institutional decay in the late 19th and early 20th centuries. Miraglia undertook the daunting task of managing a bank on the brink of bankruptcy due to the...

The essay examines the commercial and financial activities of Palla Strozzi, a Florentine merchant active in Lyon in the first half of the 16th century. A cousin of the leaders of the Florentine republican movement - the brothers Piero, Roberto and Leone Strozzi, allies of France against duke...

This paper examines the pivotal role of Nicola Miraglia in steering the Banco di Napoli through a tumultuous period of economic crisis and institutional decay in the late 19th and early 20th centuries. Miraglia undertook the daunting task of managing a bank on the brink of bankruptcy due to the...

The essay examines the commercial and financial activities of Palla Strozzi, a Florentine merchant active in Lyon in the first half of the 16th century. A cousin of the leaders of the Florentine republican movement - the brothers Piero, Roberto and Leone Strozzi, allies of France against duke...

We set up a simple theoretical model in which banks with varying degrees of government support are matched with CEOs that have different degrees of overconfidence. The channel through which the matching occurs is the share of bonus payments offered by banks in their profit-maximizing contracts....

Information and communication technologies have changed the working of the banking industry in the last few years. The transformation is expected to quicken their pace in the coming years. The trend towards electronic delivery of products and services is dramatically changing in the financial...

Research Questions/Issues: Executive remuneration as a tool of resolving agency problems or as a sign of them has been discussed in the literature for decades. The discussion, however, has been focused on non-financial firms. Bankers’ remuneration has been overlooked until recently. Due to...

Bankers’ acceptances (BAs) are a form of investment security guaranteed by banks to fund loans to businesses against their credit lines. In Canada, BAs underpin the Canadian Dollar Offered Rate (CDOR), the main benchmark used to calculate floating interest rates in Canada’s derivatives...

We implement a lab-in-the-field experiment with 334 Turkish loan officers to document gender discrimination in small business lending and to unpack the mechanisms at play. Each officer reviews multiple real-life loan applications in which we randomize the applicant's gender. While unconditional...

The Federal Reserve can remove bankers from office if they violate the law, engage in unsafe or unsound practices, or breach their fiduciary duties. The Fed, however, has used this power so rarely that few even realize it exists. Although major U.S. banks have admitted to repeated and flagrant...

We implement a lab-in-the-field experiment with 334 Turkish loan officers to test for the presence, and learn about the mechanisms, of gender discrimination in small business lending. Each officer reviews multiple real-life loan applications in which we randomize the applicant's gender. While...

We analyze compensation design in banks. Specifically, we document associations with firm characteristics, time-series trends, pay-for-performance sensitivities, performance based pay, and the sensitivity of firm-related wealth to changes in stock return and stock return volatility. We find a...

Commercial banker-directors (CBDs) bring both financial expertise in risk management and conflicts of interest between shareholders and debtholders. The burgeoning literature on stock price crash risk generates important questions of whether CBDs reduce crash risk. Using BoardEx data from 1999...

"Before the Gilded Age is the first modern and thorough biography of William Wilson Corcoran (1798-1888), one of the nation's earliest and most successful political insiders, financiers, philanthropists, and shapers of the emerging cultural elite during the era before the Gilded Age. He was a...

This paper studies banks' investment in risk management practices following the Global Financial Crisis and the advent of stress testing. Banks that experienced greater losses during the Crisis exhibit stronger demand for risk management talents. Banks increase their demand for highly skilled...

We derive a principal-agent model to analyze the effectiveness of bonus caps and deferrals in regulating banks' risk-taking. We calibrate the model to a sample of large US banks on the eve of the Global Financial Crisis and run counterfactual analyses of the potential effects of the...

We examine how directors with investment banking experience affect a firm's acquisition behavior. We find that the presence of investment banker directors is associated with a higher probability of subsequent acquisitions, and such positive relation is not driven by reverse causality. Focusing...

A multi-agent, moral-hazard model of a bank operating under deposit insurance and limited liability is used to analyze the connection between compensation of bank employees (below CEO) and bank risk. Limited liability with deposit insurance is a force that distorts effort down. However, the need...

Governance literature finds that the independent directors from the lending banks (CBDs) bring both financial expertise and conflict of interest between shareholders and debtholder. We examine how the presence of CBDs affects the implicit incentive of CEO turnover. Using BoardEx and DealScan...

The capstone of regulatory reform in the wake of the financial crisis has turned out to be an effort to pair substantive changes to the financial industry with an effort to get bankers to behave more ethically. Regulators have emphasized the importance of “culture” set by a “tone at the...

We investigate how board oversight of U.S. banks has improved since the 2008 financial crisis. Several government-mandated committees have highlighted four key deficiencies with bank boards before the crisis: (i) group think among bank board members; (ii) absence of prior banking experience of...

"Who do you think of when you imagine a hedge fund manager? A greedy fraudster, a visionary entrepreneur, a wolf of Wall Street? These tropes capture the public imagination of a successful hedge fund manager. But behind the designer suits, helicopter commutes, and illicit pursuits are the...

This book investigates the pre-crisis practice of bankers' remuneration in the UK to provide evidence of the problems in practice. It critically analyses the regulatory initiatives implemented after the crisis and investigates the post-crisis practice to reflect the effects and problems of the...