Reporting Rules in Bank Runs

Accounting versus Prudential Regulation

“…Corona, Nan, and Zhang (2019b) examine the coordination role of stress-test disclosure in affecting bank risk-taking. Gao and Jiang (2018), Liang and Zhang (2019), Zhang (2021), and G. Zhang and R. Zheng (2021) analyze the role of accounting information in stabilizing bank runs. Corona, Nan, and Zhang (2015) examine the impact of accounting information quality on the efficiency of capital requirements and banks' risk-taking incentives taking into account the competition among banks.…”

Toward a general equilibrium theory of financial reporting

“…Overall, these models can be interpreted as particular channels that explain how a small change in fundamentals can trigger runs in investment or trading decisions. Finally, although we model a firm seeking capital via (optimal) debt-like financing, there may be other aspects related to how the banking system facilitates access to debt; we refer to Corona et al (2019) and Zhang and Zheng (2022) for some of the different coordination issues arising from runs.…”