Short-selling threats and bank risk-taking: Evidence from the financial crisis

Dien Giau Bui, Iftekhar Hasan, Chih Yung Lin*, Hong Thoa Nguyen

*此作品的通信作者

研究成果: Article同行評審

1 引文 斯高帕斯(Scopus)

摘要

The focus of this paper is whether the Securities and Exchange Commission's Regulation SHO strengthens or weakens the effect of short-selling threats on banks’ risk-taking. The evidence shows that pilot banks with looser constraints on short-selling increased their risk-taking during the financial crisis of 2007–2009. The reason is that short-selling threats improved the information environment and mitigated the agency problems of banks during the pilot program that led to greater risk-taking by pilot banks. Additionally, this effect is mainly driven by pilot banks with poor corporate governance, or high information asymmetry. Overall, our paper provides novel evidence that the disciplinary role of short-sellers had a positive effect on bank risk-taking during the financial crisis.

原文English
文章編號106834
期刊Journal of Banking and Finance
150
DOIs
出版狀態Published - 5月 2023

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