Myron L. Kwast

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This article designs a framework for evaluating the causes, consequences, and future implications of financial services industry consolidation, reviews the extant research literature within the context of this framework (over 250 references), and suggests fruitful avenues for future research. The evidence is consistent with increases in market power from(More)
We examine the effects of bank M&As on small business lending. Our methodology permits empirical analysis of the great majority of U.S. bank M&As since the late 1970s -over 6,000 M&As involving over 10,000 banks (some active banks are counted multiple times). We are the first to decompose the impact of M&As on small business lending into static effects(More)
We analyse the ability of equity market-based distances-to-default and subordinated bond spreads to signal a material weakening in banks’ financial condition. Using option pricing, we show that both indicators are complete and unbiased indicators of bank fragility. We empirically test these properties using a sample of EU banks. Two different econometric(More)
Risk-based capital (RBC) is an important component of deposit insurance reform. This paper provides an empirical analysis of the new 1992 RBC bank standards, applying them to data on virtually all U.S. banks from 1982 to 1989. The data reveal strong associations between several measures of future bank performance (including bankruptcy) and the RBC relative(More)
In the 1980s, U.S. banks became systematically less profitable and riskier as nonbank competition eroded the profitability of banks' traditional activities. Bank failures, insignificant from 1934, the date the Glass-Steagall Act was passed, until 1980, rose exponentially in the 1980s. The leading explanation for the persistence of these trends centers on(More)
We investigate how banking market competition, informational opacity, and sensitivity to shocks have changed over the last three decades by examining the persistence of ®rm-level rents. We develop propagation mechanisms with testable implications to isolate the sources of persistence. Our analysis suggests that di€erent processes underlie persistence at the(More)
Academics, policymakers and bank supervisors have expressed considerable interest in using subordinated debt and other market data in the surveillance of banking organizations, especially large and complex financial institutions. However, little research has been devoted to developing practical means of implementing such an approach for subordinated debt.(More)
  • Ken Cavalluzzo, John Wolken, +6 authors Teri Yohn
  • 2002
Using newly available data from the Federal Reserve, we examine the impact of personal wealth on small business loan turndowns across demographic groups. Information on home ownership, home equity, and personal net worth excluding the business owner’s home, in combination with data on the personal credit history of the principal owner, the business credit(More)