Securitization and Bank Performance

Casu, B., Clare, A., Sarkisyan, A. & Thomas, S. (2013). Securitization and Bank Performance. Securitization and Bank Performance, 45(8), pp. 1617-1658. doi: 10.1111/jmcb.12064

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Abstract

Using predominantly precrisis U.S. commercial bank data, this paper employs a propensity score matching approach to analyze whether individual banks did improve their performance through securitization. On average, our results show that securitizing banks tend to be more profitable institutions, with higher credit risk exposure. Despite a more diversified funding structure, they face higher funding costs. We also find that securitizing banks tend to hold larger and less diversified loan portfolios, have less liquidity, and hold less capital. However, our analysis does not provide evidence to suggest that securitization had an impact upon bank performance.

Item Type: Article
Additional Information: This is the accepted version of the following article: CASU, B., CLARE, A., SARKISYAN, A. and THOMAS, S. (2013), Securitization and Bank Performance. Journal of Money, Credit and Banking, 45: 1617–1658., which has been published in final form at http://dx.doi.org/10.1111/jmcb.12064
Uncontrolled Keywords: securitization; bank performance; propensity score matching
Subjects: H Social Sciences > HF Commerce
Divisions: Cass Business School > Faculty of Finance
Related URLs:
URI: http://openaccess.city.ac.uk/id/eprint/5948

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