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Deposit and Credit Reallocation in a Banking Panic: The Role of State-Owned Banks / Viral V. Acharya, Abhiman Das, Nirupama Kulkarni, Prachi Mishra, Nagpurnanand R. Prabhala.
- Format:
- Book
- Author/Creator:
- Acharya, Viral V.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w30557.
- NBER working paper series no. w30557
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2022.
- Summary:
- We study a bank run in India in which private bank branches experience sudden and considerable loss of deposits, which migrate to state-owned public sector banks (PSBs) that serve as safe havens. We trace the consequences of the deposit reallocation using granular bank-firm relationship and branch balance sheet data. The flight to safety is not a flight to quality. Lending shrinks and credit quality improves at the run banks but worsens at the PSBs receiving the flight-to-safety flows, especially the weaker ones. The resource reallocation is inefficient in the aggregate.
- Notes:
- Print version record
- October 2022.
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