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Were regulatory interventions effective in lowering systemic risk during the financial crisis in Japan?

Katsutoshi Shimizu, Kim Cuong Ly, Kim Cuong Ly Orcid Logo

Journal of Multinational Financial Management, Volume: 41, Pages: 80 - 91

Swansea University Author: Kim Cuong Ly Orcid Logo

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DOI (Published version): 10.1016/j.mulfin.2017.07.001

Abstract

This study investigates the effectiveness of various regulatory interventions on systemic risk during the financial crisis in Japan. Our evidence generally shows that the regulatory interventions worked effectively through the liquidity provision. That is, the public fund injection programs, the pro...

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Published in: Journal of Multinational Financial Management
ISSN: 1042444X
Published: 2017
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URI: https://cronfa.swan.ac.uk/Record/cronfa34600
first_indexed 2017-07-11T12:06:32Z
last_indexed 2019-07-23T15:00:00Z
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spelling 2019-07-23T11:27:17.9625460 v2 34600 2017-07-10 Were regulatory interventions effective in lowering systemic risk during the financial crisis in Japan? 06f8b2f66ecfb3ec21bd129e86e3e0ea 0000-0001-5856-4560 Kim Cuong Ly Kim Cuong Ly true false 2017-07-10 CBAE This study investigates the effectiveness of various regulatory interventions on systemic risk during the financial crisis in Japan. Our evidence generally shows that the regulatory interventions worked effectively through the liquidity provision. That is, the public fund injection programs, the prompt corrective actions, and the blanket guarantee reduced systemic risk. The simple government intervention package to bail out distressed “too-big-to-fail” banks stabilized the banking system via the external channel whereas the massive bailout scheme suffered the “too-many-to-fail” problem in the sense that it increased systemic risk through both direct spillover and external channels. This study suggests that the effective government intervention should be restricted to a limited number of bailouts to reduce systemic risk. Journal Article Journal of Multinational Financial Management 41 80 91 1042444X financial crisis, systemic risk, deposit insurance, public fund injection, bank failure 30 9 2017 2017-09-30 10.1016/j.mulfin.2017.07.001 http://www.sciencedirect.com/science/article/pii/S1042444X16300846 COLLEGE NANME Management School COLLEGE CODE CBAE Swansea University 2019-07-23T11:27:17.9625460 2017-07-10T17:27:02.3595900 Faculty of Humanities and Social Sciences School of Management - Accounting and Finance Katsutoshi Shimizu 1 Kim Cuong Ly 2 Kim Cuong Ly 0000-0001-5856-4560 3 0034600-01082017145359.pdf 34600.pdf 2017-08-01T14:53:59.0130000 Output 237453 application/pdf Accepted Manuscript true 2018-07-26T00:00:00.0000000 CC-BY-NC-ND true eng
title Were regulatory interventions effective in lowering systemic risk during the financial crisis in Japan?
spellingShingle Were regulatory interventions effective in lowering systemic risk during the financial crisis in Japan?
Kim Cuong Ly
title_short Were regulatory interventions effective in lowering systemic risk during the financial crisis in Japan?
title_full Were regulatory interventions effective in lowering systemic risk during the financial crisis in Japan?
title_fullStr Were regulatory interventions effective in lowering systemic risk during the financial crisis in Japan?
title_full_unstemmed Were regulatory interventions effective in lowering systemic risk during the financial crisis in Japan?
title_sort Were regulatory interventions effective in lowering systemic risk during the financial crisis in Japan?
author_id_str_mv 06f8b2f66ecfb3ec21bd129e86e3e0ea
author_id_fullname_str_mv 06f8b2f66ecfb3ec21bd129e86e3e0ea_***_Kim Cuong Ly
author Kim Cuong Ly
author2 Katsutoshi Shimizu
Kim Cuong Ly
Kim Cuong Ly
format Journal article
container_title Journal of Multinational Financial Management
container_volume 41
container_start_page 80
publishDate 2017
institution Swansea University
issn 1042444X
doi_str_mv 10.1016/j.mulfin.2017.07.001
college_str Faculty of Humanities and Social Sciences
hierarchytype
hierarchy_top_id facultyofhumanitiesandsocialsciences
hierarchy_top_title Faculty of Humanities and Social Sciences
hierarchy_parent_id facultyofhumanitiesandsocialsciences
hierarchy_parent_title Faculty of Humanities and Social Sciences
department_str School of Management - Accounting and Finance{{{_:::_}}}Faculty of Humanities and Social Sciences{{{_:::_}}}School of Management - Accounting and Finance
url http://www.sciencedirect.com/science/article/pii/S1042444X16300846
document_store_str 1
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description This study investigates the effectiveness of various regulatory interventions on systemic risk during the financial crisis in Japan. Our evidence generally shows that the regulatory interventions worked effectively through the liquidity provision. That is, the public fund injection programs, the prompt corrective actions, and the blanket guarantee reduced systemic risk. The simple government intervention package to bail out distressed “too-big-to-fail” banks stabilized the banking system via the external channel whereas the massive bailout scheme suffered the “too-many-to-fail” problem in the sense that it increased systemic risk through both direct spillover and external channels. This study suggests that the effective government intervention should be restricted to a limited number of bailouts to reduce systemic risk.
published_date 2017-09-30T07:05:40Z
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score 11.054403

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