Déjà Vu All Over Again: The Causes of U.S. Commercial Bank Failures This Time Around

Cole, Rebel A.; White, Lawrence J.

doi:10.1007/s10693-011-0116-9

Cited by 390 publications

(364 citation statements)

References 18 publications

Supporting

Mentioning

310

Contrasting

Unclassified

Order By: Relevance

“…Blasko and Sinkey (2006) notice that real estate banks are riskier since they tend to be more capital constrained and they keep higher ratios of fixed-rate loans to total assets. Furthermore, Cole and White (2012) conclude that the basic drivers of bank financial performance and failure during the financial crisis are concentrations of commercial real estate loans.…”

Section: Riskmentioning

confidence: 98%

The Impact of the Financial Crisis on the Islamic Banks Profitability - Evidence from GCC

Almanaseer¹

2014

International Journal of Financial Research

View full text Add to dashboard Cite

Using pooled data for 24 Islamic banks operating in Bahrain, Kuwait, Qatar, Saudi Arabia and UAE over the 2005-2012 period the current study examines empirically the impact of the global financial crisis on the Islamic banks' profitability.The study finds that the financial crisis does not have significant impact on Islamic banks profitability. Favorable macro-economic conditions, bank size and equity capital are important factors in increasing Islamic banks' profitability. Furthermore Increasing owners' equity decreased the impact of financial crisis on Islamic banks profitability. On the other hand, the impact of the financial crisis on Islamic banks' profitability increase with increasing banks total assets, liquidity and overhead expenses. The study recommends increasing both Islamic banks' size and equity capital in addition to reducing their overhead expenses and liquidity in order to increase their profitability and decrease the impact of financial crisis in their performances.

show abstract

Section: Riskmentioning

confidence: 98%

The Impact of the Financial Crisis on the Islamic Banks Profitability - Evidence from GCC

Almanaseer¹

2014

International Journal of Financial Research

View full text Add to dashboard Cite

show abstract

“…Fayman and He (2011) present evidence that the addition of a prepayment risk variable to regression models can improve their ability to explain bank performance measures, probably through its effect on return on loans, return on equity, and the ratio of real estate loans to total loans. Cole and White (2012) demonstrate that the traditional CAMELS proxies and measures of commercial real estate investments explain the failure of US banks in 2009, but that residential mortgage-backed securities do not.…”

Section: Literature Reviewmentioning

confidence: 89%

Drivers of US Bank Failures during the Financial Crisis

Cox¹,

Kimmel²,

Wang³

2017

IJBM

View full text Add to dashboard Cite

Hundreds of banks failed during the financial crisis of 2008 to 2010 causing significant social cost and enfeebling economic growth for years following. In the aftermath of the crisis, regulators responded, as always, with new regulations, the efficacy of which is debatable. For policy makers to enact effective regulation, they must understand the true cause of bank failures during crisis periods. We study the effects of 31 variables using univariate t-tests and probit regression to determine their influence on the probability of bank failure. We find that banks failed during the 2008 to 2010 financial crisis because of choices management made to accept more risk, specifically by having higher financial leverage, investing in higher risk loans in real estate and construction and by holding less liquid assets and fewer low risk loans like single family real estate loans. That is, the cause of US bank failures during the finance crisis was poor management.

show abstract

“…Cole and White (2012) analyzed Call Report data from 2004 to 2008 in order to determine the factors that led to bank failures in 2009. They found that commercial real estate lending, particularly in the area of construction and development, is a strong early predictor of bank failure in this period.…”

Section: Literaturementioning

confidence: 99%

Comparison of Small Bank Failures and FDIC Losses in the 1986–92 and 2007–13 Banking Crises

Balla¹,

Mazur²,

Prescott

et al. 2017

Working Paper (Federal Reserve Bank of Cleveland)

View full text Add to dashboard Cite

Déjà Vu All Over Again: The Causes of U.S. Commercial Bank Failures This Time Around

Cited by 390 publications

References 18 publications

The Impact of the Financial Crisis on the Islamic Banks Profitability - Evidence from GCC

The Impact of the Financial Crisis on the Islamic Banks Profitability - Evidence from GCC

Drivers of US Bank Failures during the Financial Crisis

Comparison of Small Bank Failures and FDIC Losses in the 1986–92 and 2007–13 Banking Crises

Contact Info

Product

Resources

About