Resolving Bank Failures and Institutions: Is there a Link? Some Empirical Evidence

Marlon Rawlins and Luisa Zanforlin

No 2021/211, IMF Working Papers from International Monetary Fund

Abstract: Policymakers across countries have been seeking to strengthen the institutional framework to control fiscal costs and feedback effects to the real economy generated by bank failures. On a cross-section of countries, we find evidence that suggests that bank supervisors’ intervention in bank failures may be positively associated with some aspects of the administrative and regulatory framework. Our results appear to hold also during times of financial instability. Finally, we find some evidence that the same institutional features may be associated with lower fiscal outlays during banking crises.

Keywords: feedback effect; times authorities; government efficiency; supervisory authority; review authorities; bank insolvency proceeding; CB independence; Banking crises; Distressed institutions; Central bank autonomy; Financial sector stability; South America; Global (search for similar items in EconPapers)
Pages: 29
Date: 2021-08-06
New Economics Papers: this item is included in nep-cba, nep-cwa and nep-fdg
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Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:2021/211

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