|Researchers:||Marie Lalanne, Uwe Walz|
|Category:||Financial Intermediation, Systemic Risk Lab, Transparency Lab, Experiment Center|
The corporate governance of banks differs considerably from the governance of non-financial firms. Besides the traditional stakeholders (debt and equity holders), banks have the government as an additional stakeholder (directly via government ownership of banks and indirectly via e.g. bailout guarantees). Government interventions on corporate governance of banks result in incentives for banks to become interconnected.
Interconnectedness between banks is based on different channels. Besides the traditionally investigated channels, such as connection through interbank loans, derivatives etc., interconnectedness via social networks of bankers has recently become increasingly important. Managers and directors of banks often have social ties to other banks/firms managers that have an influence on the behavior of banks. These social ties potentially lead to e.g. higher investment correlation of different financial institutions and more homogenous behavior and thus to higher systemic risk.
The aim of this project was to address important aspects of the corporate governance of banks, including bank executives´ compensation schemes and their effects on capital structure and investment decisions of a bank. Furthermore, the project analyzed the incentives for banks to be interconnected as well as internal solutions for bank´s leverage and asset risk choices. The project relied on diverse methodologies, including microeconomic modelling, lab experiments as well as empirical analysis based on data from the field.
|Christian Eufinger, Andrej Gill||Incentive-Based Capital Requirements|
|2017||Financial Intermediation, Systemic Risk Lab, Transparency Lab, Experiment Center||Basel III, capital regulation, compensation, leverage, risk|
|Tim Eisert, Christian Eufinger||Interbank Networks and Backdoor Bailouts: Benefiting from Other Banks’ Government Guarantees|
|2019||Financial Intermediation, Systemic Risk Lab, Transparency Lab, Experiment Center||bailout, cycle flows, cyclical liabilities, interbank network, leverage|
|10||Interbank Network and Bank Bailouts: Insurance Mechanism for Non-Insured Creditors?||2013||Financial Intermediation, Systemic Risk Lab, Transparency Lab, Experiment Center||bailout, cycle flows, cyclical liabilities, interbank network, leverage|