Deposit Supply and Bank Transparency

47 Pages Posted: 15 Nov 2018 Last revised: 18 Jan 2019

See all articles by Liangliang Jiang

Liangliang Jiang

Hong Kong Polytechnic University

Ross Levine

University of California, Berkeley - Haas School of Business; National Bureau of Economic Research (NBER)

Chen Lin

The University of Hong Kong - Faculty of Business and Economics

Wensi Xie

The Chinese University of Hong Kong (CUHK) - CUHK Business School

Date Written: January 2019

Abstract

Given the importance of transparency for the governance, efficiency, and stability of banks, we evaluate whether economic shocks that relax a bank’s dependence on external capital markets alter the cost-benefit calculations of bank managers concerning voluntary information disclosure. We measure information disclosure based on 10-K filings, 8-K filings, earnings guidance, and stock market liquidity. As a funding shock, we use unanticipated technological innovations that triggered shale development and deposit booms. Greater exposure to shale development reduced information disclosure, suggesting that deposit windfalls relax the incentives for managers to disclose information to attract funds.

Keywords: Bank Transparency, Information Production, Deposit Supply

JEL Classification: G31, G21, D83, D82, G14

Suggested Citation

Jiang, Liangliang and Levine, Ross Eric and Lin, Chen and Xie, Wensi, Deposit Supply and Bank Transparency (January 2019). Available at SSRN: https://ssrn.com/abstract=3270775 or http://dx.doi.org/10.2139/ssrn.3270775

Liangliang Jiang

Hong Kong Polytechnic University ( email )

11 Yuk Choi Rd
Hung Hom
Hong Kong

Ross Eric Levine (Contact Author)

University of California, Berkeley - Haas School of Business ( email )

545 Student Services Building, #1900
2220 Piedmont Avenue
Berkeley, CA 94720
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Chen Lin

The University of Hong Kong - Faculty of Business and Economics ( email )

Pokfulam Road
Hong Kong
China

Wensi Xie

The Chinese University of Hong Kong (CUHK) - CUHK Business School ( email )

Cheng Yu Tung Building
12 Chak Cheung Street
Shatin, N.T.
Hong Kong

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