By analysing the macro financial determinants of the Great Financial Crisis of 2007-2009 on 83 countries, we find that the probability of suffering the crisis in 2008 was larger for countries having higher levels of credit deposit ratio whereas it was lower for countries having higher levels of: i) net interest margin, ii) concentration in the banking sector, iii) restrictions to bank activities, iv) private monitoring. Our findings contribute to the ongoing discussion that can help policymakers calibrate new regulation, by achieving a reasonable trade-off between financial stability and economic growth.JEL Classification: G15; G18; G21

We test whether small US commercial banks that use a traditional business model are more likely to survive than non-traditional banks during both good and bad economic climates. Our concept of bank survival is derived from Stigler (1958) and includes any bank that does not fail or is not acquired. We define traditional banking by four hallmark characteristics: Relationship loans, core deposit funding, revenue streams from traditional banking services, and physical bank branches. Banks that adhered more closely to this business strategy were an estimated 8 to 13 percentage points more likely to survive from 1997 through 2012 compared to other small banks using less traditional business strategies. This survival advantage approximately doubled during the financial crisis period.

By analysing the macro financial determinants of the Great Financial Crisis of 2007-2009 on 83 countries, we find that the probability of suffering the crisis in 2008 was larger for countries having higher levels of credit deposit ratio whereas it was lower for countries having higher levels of: i) net interest margin, ii) concentration in the banking sector, iii) restrictions to bank activities, iv) private monitoring. Our findings contribute to the ongoing discussion that can help policymakers calibrate new regulation, by achieving a reasonable trade-off between financial stability and economic growth.JEL Classification: G15; G18; G21

We test whether small US commercial banks that use a traditional business model are more likely to survive than non-traditional banks during both good and bad economic climates. Our concept of bank survival is derived from Stigler (1958) and includes any bank that does not fail or is not acquired. We define traditional banking by four hallmark characteristics: Relationship loans, core deposit funding, revenue streams from traditional banking services, and physical bank branches. Banks that adhered more closely to this business strategy were an estimated 8 to 13 percentage points more likely to survive from 1997 through 2012 compared to other small banks using less traditional business strategies. This survival advantage approximately doubled during the financial crisis period.

Sustainable and Responsible Investment (SRI) funds – the largest component of the fast‐expanding sustainable financial investment industry – apply environmental, social and governance (ESG) analyses to manage their investment portfolios and are particularly demanding in terms of issuers' disclosure. In this paper we take a step forward and ask whether adopting high‐quality sustainability disclosure is important also for SRI funds' holding companies. Specifically, we introduce a novel metrics on the extent of holding companies' sustainability disclosure based on the quality of their Global Reporting Initiative (GRI) reporting. In parallel, we use a standard approach to measure a fund's ESG intensity, that is, the weighted ESG average of a fund's investments. Indeed, we find that an SRI fund's ESG intensity systematically improves when the associated holding company improves its GRI sustainability disclosure. Moreover, we show that this positive effect of holdings' disclosure on a fund's ESG intensity is larger in jurisdictions with less stringent regulation on disclosure, where the signaling value of GRI disclosure is supposedly heightened. Our results do not seem to be driven by endogeneity between a fund's ESG intensity and its holding company's GRI reporting. First, a fund's ESG investment policy and its holding company's sustainability disclosure policy lie on separate decision ladders. Second, we show that the two variables are empirically uncorrelated. Third, our results prove resilient to a battery of robustness checks. The implication of our finding is that holding companies' sustainability disclosure engagement can reap a benefit for their managed SRI funds – provided ESG ratings are reliable –, whose enhanced credibility might prove a key competitive factor.