Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/100956
Authors: 
Gerald P. Dwyer, Jr.
Hafer, R.W.
Year of Publication: 
2001
Series/Report no.: 
Working Paper, Federal Reserve Bank of Atlanta 2001-13
Abstract: 
Are banks that fail in banking panics the riskiest ones prior to the panics? The free banking era in the United States provides useful data to examine this question because the assets held by the banks were traded at the New York Stock Exchange. The authors estimate the ex ante riskiness of a bank’s portfolio by examining the portfolio relative to mean-variance frontiers and by examining the bank's leverage and notes relative to assets. The authors find that the ex ante riskiness of a bank’s portfolio helps predict which banks fail and the extent of noteholders’ losses in the event of failure.
Subjects: 
Risk
Debt
Bank supervision
Bank failures
Document Type: 
Working Paper

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