Accounting discretion of banks during a financial crisis / / Luc Laeven, Harry Huizinga

• Autore: Laeven Luc
• Pubblicazione: Washington, D.C. : , : International Monetary Fund, , 2009
• Edizione: 1st ed.
• Descrizione fisica: 41 p. : ill
• Disciplina: 332.01
• Soggetto topico: Banks and banking; Accounting - Corrupt practices; Banks and Banking; Financial Risk Management; Investments: General; Industries: Financial Services; Banks; Depository Institutions; Micro Finance Institutions; Mortgages; Financial Institutions and Services: Government Policy and Regulation; International Financial Markets; General Financial Markets: General (includes Measurement and Data); Banking; Finance; Financial services law & regulation; Investment & securities; Loans; Loan loss provisions; Asset valuation; Securities; State supervision; Asset-liability management; Financial instruments
• Soggetto geografico: United States
• Altri autori: HuizingaHarry
• Note generali: Bibliographic Level Mode of Issuance: Monograph
• Nota di bibliografia: Includes bibliographical references.
• Nota di contenuto: Intro -- Contents -- I. Introduction -- II. Tobin's q Value and Market Discounts -- III. The Data -- IV. Market Discounts and Valuation Effects of Real Estate Related Assets -- A. Empirical Evidence on Market Discounts -- B. Banks' Stock Price Reaction to Amendments of Fair Value Accounting Rules -- V. Accounting Discretion on Impaired Assets and Asset Classification -- A. Accounting Discretion on Accounting for Bad Loans -- B. Classification of Mortgage-Backed Securities -- VI. Conclusions -- References -- Appendix -- Variable Definitions and Data Sources -- Tables -- 1. Summary Statistics for 2008, Quarterly Data -- 2. Tobin's q and Real Estate Related Assets in 2008 -- 3. Tobin's q and Real Estate Related Assets in 2001-2007 -- 4. Tobin's q Real Estate Related Assets and Asset Size -- 5. Tobin's q and Additional Balance Sheet and Off-balance Sheet Items -- 6. Event Study of New FASB Rules on Fair Value Accounting for Illiquid Assets (FAS 157), Announced on October 10, 2008 -- 7. Event Study of FASB Amendments to Fair Value Accounting of Hard-to-Value Assets, Announced on April 9, 2009 -- 8. Loan Loss Provisions and Net Loan Charge-offs in 2008 -- 9. Share of Mortgage-backed Securities that is Held-to-Maturity in 2008 -- 10. Share of Non-Guaranteed Mortgage-backed Securities that is Held-to-Maturity in 2001-2007 -- Figures -- 1. Tobin's q and Share of Zombie Banks -- 2. Real Estate Loans and Mortgage-backed Securities -- 3. Share of Mortgage-backed Securities that is Held-to-Maturity -- 4. Fair Value of Mortgage-backed Securities Relative to Amortized Cost -- 5. Tier 1 Capital Ratio and Share of Tier 1 Capital in Total Capital.
• Sommario/riassunto: This paper shows that banks use accounting discretion to overstate the value of distressed assets. Banks' balance sheets overvalue real estate-related assets compared to the market value of these assets, especially during the U.S. mortgage crisis. Share prices of banks with large exposure to mortgage-backed securities also react favorably to recent changes in accounting rules that relax fair-value accounting, and these banks provision less for bad loans. Furthermore, distressed banks use discretion in the classification of mortgage-backed securities to inflate their books. Our results indicate that banks' balance sheets offer a distorted view of the financial health of the banks.
• Titolo autorizzato: Accounting discretion of banks during a financial crisis
• ISBN: 1-4623-3255-2; 1-4518-7354-9; 1-282-84413-X; 9786612844133; 1-4527-3492-5
• Formato: Materiale a stampa
• Livello bibliografico: Monografia
• Lingua di pubblicazione: Inglese
• Record Nr.: 9910827473703321
• Lo trovi qui: Univ. Federico II
• Serie: IMF Working Papers; Working Paper ; ; No. 2009/207