Deteriorating public finances around the world raise doubts about countries' abilities to bail out their largest banks. For an international sample of banks, this paper investigates the impact of government indebtedness and deficits on bank stock prices and credit default swap spreads. Overall, bank stock prices reflect a negative capitalization of government debt and they respond negatively to deficits. The authors present evidence that in 2008 systemically...
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INFORMATION
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2010/07/01
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Document de travail de recherche sur les politiques
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WPS5360
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1
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1
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2010/07/19
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Disclosed
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Are banks too big to fail or too big to save ? International evidence from equity prices and CDS spreads
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Finance & Private Sector Development