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The impact of prompt corrective action on the default risk of the U.S. commercial banking sector

Kanas, Angelos (2014) The impact of prompt corrective action on the default risk of the U.S. commercial banking sector. Review of Quantitative Finance and Accounting, 43 (2). pp. 393-404. ISSN 0924-865X. E-ISSN 1573-7179. (doi:10.1007/s11156-013-0378-4) (The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided)

The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided. (Contact us about this Publication)
Official URL
http://dx.doi.org/10.1007/s11156-013-0378-4

Abstract

As the Basel III reforms, which come into effect from 2012, place emphasis on default risk, assessing the impact of Prompt Corrective Action (PCA) on default risk is of practical relevance. We provide strong evidence that both the dynamic and the contemporaneous impact of the PCA-defined tier 1 risk-based capital ratio and the tier 1 leverage ratio on default risk is reduced following PCA's introduction. We interpret this as evidence that PCA is effective in managing the default risk of the U.S. commercial banking sector. © 2013 Springer Science+Business Media New York.

Item Type: Article
DOI/Identification number: 10.1007/s11156-013-0378-4
Additional information: Unmapped bibliographic data: JA - Rev. Quant. Financ. Account. [Field not mapped to EPrints] AD - Department of Economics, University of Piraeus, Piraeus, Greece [Field not mapped to EPrints]
Uncontrolled keywords: Commercial banks, Default risk, PCA, Regimes, USA
Subjects: H Social Sciences > HG Finance
Divisions: Faculties > Social Sciences > Kent Business School > Accounting and Finance
Depositing User: Tracey Pemble
Date Deposited: 22 May 2014 11:08 UTC
Last Modified: 29 May 2019 12:36 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/41126 (The current URI for this page, for reference purposes)
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