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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The paper shows that, as owners accumulate larger stakes and hence become less risk-tolerant, their incentives to monitor management are attenuated because monitoring shifts some of the firm's risk from management to owners. This counterbalances the positive effect which more concentrated ownership has on monitoring via reduced free rider problems. Moreover, the paper shows how the opportunity cost of concentrated ownership, which is the loss of risk-sharing benefits, creates scope to use leverage as an additional complementary governance instrument. The paper offers new explanations for several empirical regularities found in the literature. Terms of use: Documents in

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Banking and balance of payments crises often happen simultaneously. We show that the impact of a devaluation on the net worth of commercial banks with a short open foreign exchange position speeds up the timing of a balance of payments crisis. In an asymmetric information framework, domestic commercial banks have to pay a positive risk premium on the international capital market which is determined by their net worth. Some stylized facts from selected crises episodes are presented in order to gauge the empirical relevance of the effects that have been stressed in the model. Copyright © 1999 John Wiley & Sons, Ltd.

Since August 1998, Russia has been suffering from a severe banking crisis. In finding a solution, two peculiarities of the Russian economy need to be taken into account: the substantial foreign liabilities of commercial banks and the failure of the government to service its liabilities. Apart from the externality problem of bank recapitalization, the paper discusses how to deal with the adverse selection and moral hazard problems resulting from asymmetries of information. We suggest that banks should be offered to their foreign creditors for recapitalization and that banks which cannot attract additional funds should be closed. The government should support the recapitalization process by taking over control from the banks' old shareholders. This would facilitate the transfer of control to foreign creditors. It would also serve to limit asset stripping and thereby to reduce externalities distorting the recapitalization process. Distortions could be mitigated further by bailing in investors not participating in the recapitalization.