Switching Costs, Deposit Insurance and Deposit Withdrawals from Distressed Banks

Guin, Benjamin; Brown, Martin; Morkoetter, Stefan

doi:10.2139/ssrn.2354197

Cited by 16 publications

(22 citation statements)

References 31 publications

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“…In line with Brown et al (2016) and Iyer et al (Forthcoming), we find that a client-bank relation relates to the stability of the bank client base. Bank loyalty is positively associated with having an account manager.…”

Section: Resultssupporting

confidence: 92%

Bank loyalty, social networks and crisis

Atmaca

Schoors

Verschelde

2020

Journal of Banking & Finance

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In this paper, we consider how the intensity and channels of the relation between social networks and bank loyalty vary according to the state of the economy. We analyze bank exit over the period 2005-2012 for over 300,000 retail clients of a commercial bank that experienced a bank run in 2008 due to a solvency risk. The unique and rich data we constructed in close collaboration with the bank enables us to distinguish different sorts of family networks from neighborhood networks, while controlling for a wide battery of client-level and branch-level characteristics and events. Using a proportional hazards model, we show the importance of family networks. In times of financial distress, family networks become even more important and retail clients take weaker, less direct social relationships into account.

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Section: Resultssupporting

confidence: 92%

Bank loyalty, social networks and crisis

Atmaca

Schoors

Verschelde

2020

Journal of Banking & Finance

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“…The consumption good acts as the numeraire. Similar to Iacoviello (2005) and 12 A related challenge is the analysis of optimal capital requirements from the perspective of stochastic welfare rather than, as we do in this paper, from the perspective of the welfare attained in the non-stochastic steady state. subsequent literature there are two types of households that differ in their discount factor, patient and impatient.…”

Section: Model Set-upmentioning

confidence: 99%

Capital Regulation in a Macroeconomic Model with Three Layers of Default

et al. 2014

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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. Terms of use: Documents in EconStor may AbstractWe develop a dynamic general equilibrium model for the positive and normative analysis of macroprudential policies. Optimizing financial intermediaries allocate their scarce net worth together with funds raised from saving households across two lending activities, mortgage and corporate lending. For all borrowers (households, firms, and banks) external financing takes the form of debt which is subject to default risk. This "3D model" shows the interplay between three interconnected net worth channels that cause financial amplification and the distortions due to deposit insurance. We apply it to the analysis of capital regulation.

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“…Sharpe (1997), Hannan and Adams (2011), and Carbo-Valverde, Hannan and Rodriguez-Fernandez (2011) find that areas with higher inmigration, and, thus, a supposedly higher share of people choosing without default option, offer higher deposit rates on average. Several authors analyze instead determinants of switching banks using survey data and find that household relocation, service, and price factors (Kiser (2002)), proxies for switching costs (Brown, Guin and Morkoetter (2013)), but also education and financial literacy (Brunetti, Ciciretti and Djordjevic (2016)) matter for the propensity to switch. I provide new reduced-form evidence that monetary switching benefits and online banking usage are important determinants of the decision to switch.…”

Section: Introductionmentioning

confidence: 99%

Quantifying Inertia in Retail Deposit Markets

Deuflhard

2018

SSRN Journal

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This paper investigates inertia within and across banks in retail deInformation' (University of Mannheim) for helpful comments and discussions. I am grateful to a major Dutch bank for providing interest rate data on savings accounts in the Netherlands, to CentERdata for providing additional information on financial product holdings and bank relationships of DNB survey participants, to SpaarInformatie for providing data on restrictions of Dutch savings accounts, as well as to Thomas Mosk for providing bank branch data for the Netherlands.

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Switching Costs, Deposit Insurance and Deposit Withdrawals from Distressed Banks

Cited by 16 publications

References 31 publications

Bank loyalty, social networks and crisis

Bank loyalty, social networks and crisis

Capital Regulation in a Macroeconomic Model with Three Layers of Default

Quantifying Inertia in Retail Deposit Markets

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