Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments October 28, 2015 erstellt
Description:
Enforcement actions (or sanctions) pursue two complementary goals, namely to penalize guilty companies and to provide an example to other companies that bad behaviour will be penalized. Although the recent financial crisis showed that this topic is critical in banking, only a few papers (e.g. Delis, Staikouras and Tsoumas, 2015) have analyzed the consequence of sanctions, and no papers have investigated the cross-effects on non-sanctioned banks. Focusing on the Italian banking industry (i.e. as an ideal case study), we assume that non-sanctioned banks care about the enforcement actions taken against other similar banks. By adopting a two-step model based on a propensity score matching technique to calculate the probability of a bank to be subject to sanctions, we show that the stability of non-sanctioned banks increases as the probability of being sanctioned increases (and also as the Mahalanobis distance from the group of sanctioned bank is reduced)