Depositors’ Assessment of Bank Riskiness in the Russian Federation

Ungan, Ece; Caner, Selçuk; Ozyildirim, Suheyla

doi:10.1007/s10693-007-0025-0

Cited by 48 publications

(35 citation statements)

References 24 publications

(19 reference statements)

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…Nevertheless, the wakeup-call effect on household depositors was substantially muted by the numbing effect of deposit insurance. These results contradict the research from Ungan et al (2008), who conclude that establishing a deposit insurance system in 2004 in Russia did not influence depositors' behavior. In a more recent study, Yan et al (2014) find that household depositors no longer responded to the banks' risk taking after the establishment of explicit insurance in Australia in 2008.…”

Section: Crises and Depositor Disciplinecontrasting

confidence: 95%

Depositors Discipline through Interest Costs during Good and Bad Times: the Role of the Guarantor of Last Resort1

2016

View full text Add to dashboard Cite

We investigate whether the public sector's ability as the guarantor of last resort (GLR) to help banks or to guarantee banks' liabilities affects the sensitivity of interest costs to bank fundamentals. We use a global bank sample and find that the sensitivity is an increasing function of GLR risk, regardless of the method applied to describe this risk. Therefore, our results indicate that increased levels of GLR risk might foster market monitoring by depositors.

show abstract

Section: Crises and Depositor Disciplinecontrasting

confidence: 95%

Depositors Discipline through Interest Costs during Good and Bad Times: the Role of the Guarantor of Last Resort1

2016

View full text Add to dashboard Cite

show abstract

“…Large deposit withdrawals and high interest rates are associated with banks' risk-taking behavior in the USA. Similar results are obtained by Martinez-peria and Schmukler (2001) for Latin American counties, Calomiris and Powell (2001) for Argentina, and Ungan et al (2008) for Russia. We investigated the effect of depositors discipline on bank's asset allocation.…”

supporting

confidence: 84%

Bank asset allocation: the effectiveness of market monitoring

Wang

Mahajan

Kishan

2013

Journal of Advances in Management Research

View full text Add to dashboard Cite

If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation. AbstractPurpose -The purpose of this paper is to study the effectiveness of market discipline on banks' risk-taking behavior based on how swiftly banks respond to market information. Design/methodology/approach -A simplified incentive model provides the necessary justification for two types of market disciplines: first, monitoring by uninsured market participants, and second, risk premium in terms of interest spread required by risk-averse depositors. Panel data regression is carried out for both surviving and failed US banks for the period 1999:Q4-2007:Q3 to examine the role of market discipline, bank capital, and macroeconomic shocks. Findings -The paper finds that banks which failed during 2007:Q4-2010:Q4 suffered from fundamental weaknesses in their asset quality relative to the surviving banks prior to the crisis. Originality/value -The paper focusses on two questions: In what circumstance does market monitoring exist? And how can market incentives affect banking firms' actions? The first question is studied in a simplified incentive model that provides justification for two types of market discipline. Given that, the effectiveness of market discipline is empirically tested, using the US banking data in the period leading up to a surge in the number of bank failures in 2007-2010. The paper's results show that failed institutions with large size were relatively less responsive to early warning signals of declining uninsured deposits and rising deposit spread.

show abstract

“…Evidence of price-based disciplining is, however, weak. Ungan et al (2008) also provide evidence for disciplining by quantity rather than by price in the Russian market for personal deposits. Karas et al (2010) state that banks with a low level of capital adequacy show lower a regressive norm of deposit growth and higher deposit interest rates on deposits.…”

Section: A Market Disciplinementioning

confidence: 74%

Currency Shifts as a Market Discipline Device: The Case of the Russian Market for Personal Deposits

Semenova

Shapkin²

2019

Emerging Markets Finance and Trade

View full text Add to dashboard Cite

Market discipline in the personal deposit market is of great importance for regulators. In developing economies, which rely much and are dependent on the dollar and euro, changes in the currency structure of the deposits may be strategic and work as an additional disciplining mechanism. Our study sheds light on this mechanism of currency shifts in the Russian market for personal deposits. Using data on more than 900 Russian banks for 2005-2015, we provide evidence that less risky banks-at least in terms of capital adequacy and liquidity-demonstrate higher growth of both the volume and the share of deposits denominated in foreign currency, even when the exchange rate volatility component is extracted. This mechanism continued working during the financial crisis of 2008-2009.

show abstract

Depositors’ Assessment of Bank Riskiness in the Russian Federation

Abstract: Market discipline, bank risk, emerging markets, Russian Federation, G20, G21,

Cited by 48 publications

References 24 publications

Depositors Discipline through Interest Costs during Good and Bad Times: the Role of the Guarantor of Last Resort1

Depositors Discipline through Interest Costs during Good and Bad Times: the Role of the Guarantor of Last Resort1

Bank asset allocation: the effectiveness of market monitoring

Currency Shifts as a Market Discipline Device: The Case of the Russian Market for Personal Deposits

Contact Info

Product

Resources

About