Good News for Some Banks

Renee Adams

No 311, Working Papers from The University of Chicago Booth School of Business, George J. Stigler Center for the Study of the Economy and the State

Abstract: Bankers are directors of Federal Reserve Banks. I document that a) banker directors of the New York Fed attend more meetings about the financial sector; b) elections for Reserve Bank directorships are more contested for bankers, but less so for large banks and American Banking Association directors; d) the market reaction to bankers' elections to Reserve Bank boards is 1%; e) the market reaction to insider purchases is 1.3% higher when banker directors are on a Reserve Bank board; f) Fed enforcement actions appear more moderate for banker directors. Reserve Bank directorships appear to be good news for some banks.

Keywords: Federal Reserve; Director; Banks; Conflicts of Interest; Political Connection; Reputation; Insider Trading; Enforcement Actions; Regulatory Capture (search for similar items in EconPapers)
JEL-codes: E58 G28 G30 (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:cbscwp:311

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