Enforcement actions (sanctions) aim to penalize guilty companies and provide examples to other companies that bad behavior will be penalized. A handful of papers analyze the consequences of sanctions in banking for sanctioned companies, while no papers have investigated the spillover effects on non-sanctioned banks. Focusing on credit-related sanctions, we show the existence of a spillover effect: non-sanctioned banks behave similar to sanctioned banks, depending on their degree of similarity, offloading problematic loans and reducing their lending activity.
The spillover effect of enforcement actions on bank risk-taking / Caiazza S.; Cotugno M.; Fiordelisi F.; Stefanelli S.. - In: JOURNAL OF BANKING & FINANCE. - ISSN 0378-4266. - ELETTRONICO. - 91:(2018), pp. 146-159. [10.1016/j.jbankfin.2018.04.008]
The spillover effect of enforcement actions on bank risk-taking
Cotugno M.;
2018
Abstract
Enforcement actions (sanctions) aim to penalize guilty companies and provide examples to other companies that bad behavior will be penalized. A handful of papers analyze the consequences of sanctions in banking for sanctioned companies, while no papers have investigated the spillover effects on non-sanctioned banks. Focusing on credit-related sanctions, we show the existence of a spillover effect: non-sanctioned banks behave similar to sanctioned banks, depending on their degree of similarity, offloading problematic loans and reducing their lending activity.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
