Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/148133
Authors: 
Allen, Jason
Basiri, Kiana
Year of Publication: 
2016
Series/Report no.: 
Bank of Canada Staff Working Paper 2016-26
Abstract: 
We examine the impact of the 2009 amendments to the Canadian Bankruptcy and Insolvency Act on insolvency decisions. Rule changes steered debtors out of division I proposals and into the more cost-effective division II proposals. This also led to a significant substitution out of bankruptcies and into proposals. Using credit bureau data on credit card limits we test, but do not find, any evidence that this substitution into more creditor-friendly insolvencies had any impact on average lending behavior, either immediately following the amendments or up to six years removed.
Subjects: 
Financial system regulation and policies
Financial institutions
Credit and credit aggregates
JEL: 
D14
G2
K35
Document Type: 
Working Paper

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