Media Capture by Banks

Ruben Durante, Andrea Fabiani, Luc Laeven and Jose-Luis Peydro

No 15260, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We show that media slant news in favor of their lenders, exploiting data on news coverage of key financial events in major European newspapers and information on bank-firm loan connections. First, newspapers cover earning announcements by their lenders more (relative to other banks’) when they report profits than when they report losses. Second, newspapers cover more favorably bank M&As involving their lenders as acquirers. Third, newspapers connected to banks more exposed to stressed sovereign bonds tend to endorse a pro-banks narrative of the Eurozone crisis and oppose debt-restructuring measures. Across all events, less capitalized banks benefit more from slanted coverage.

Keywords: Media bias; Banks; Newspapers; Earnings reports; Eurozone crisis (search for similar items in EconPapers)
JEL-codes: G21 L82 (search for similar items in EconPapers)
Date: 2020-09
New Economics Papers: this item is included in nep-ban and nep-eec
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Related works:
Working Paper: Media Capture by Banks (2022)
Working Paper: Media capture by banks (2022)
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