Bangor Business School Professor publishes in top tier finance journal on bank bailouts

A paper co-authored by Bangor Business School’s Professor Klaus Schaeck has just been accepted for publication in the Journal of Financial and Quantitative Analysis, one of the few finance journals used by the Financial Times to compile Business School research ranks globally.

Jointly written by Professor Klaus Schaeck and Cesar Calderon from the World Bank, the study, entitled “The effects of government interventions in the financial sector on banking competition and the evolution of zombie banks”, is the result of an earlier consulting role that Professor Klaus Schaeck held for the World Bank.

In the research paper, the authors examine the effects of bank rescue measures on the way banks compete for business. The paper finds that bank bailouts have possibly unintended consequences for customers by lowering deposit rates. At the same time, however, bank rescues also lower interest rates on bank loans.

The full study can be downloaded at  http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2516725.

Publication date: 31 October 2014