Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/244269 
Year of Publication: 
2021
Series/Report no.: 
ESRB Working Paper Series No. 117
Publisher: 
European Systemic Risk Board (ESRB), European System of Financial Supervision, Frankfurt a. M.
Abstract: 
We study the implications of information technology (IT) in banking for financial stability, using data on US banks' IT equipment and the tech-background of their executives. We find that one standard deviation higher pre-crisis IT adoption led to 10% fewer non-performing loans during the global financial crisis. We present several pieces of evidence that indicate a direct role of IT adoption in strengthening bank resilience; these include instrumental variable estimates exploiting the historical location of technical schools. Loan-level analysis reveals that high-IT adoption banks originated mortgages with better performance and did not offload low-quality loans.
Subjects: 
Technology
Financial Stability
IT Adoption
Non-Performing Loans
JEL: 
O3
G21
G14
E44
D82
D83
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-4620-9
Document Type: 
Working Paper

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