Systematically Important Banks and Increased Capital Requirements in the Dodd-Frank Era
Published in Economics Letters, 2016
Recommended citation: Economics Letters. 2016. Citation /files/Systematically Important Banks and Increased Capital Requirements in the Dodd-Frank Era.pdf
- Key Highlight: New capital requirements for systematically important financial institutions lower abnormal initial stock returns for systemically important financial firms that then reverse and dissipate after three days. Results are consistent with an initial overreaction and subsequent market correction to new capital requirements by equity market investors.