Research Papers, Authors and Key Findings
Research Paper Session 1
Deposit Franchise Value and Market Power
The Decline of Branch Banking
Poverty Spreads in Deposit Markets
Banks’ Images: Evidence from Financial Advertising
Authors: Xugan Chen, Yale University; Allen Hu, University of British Columbia
Key Findings: The authors conduct the first systematic study of financial advertising, examining how banks strategically develop their brand images, and how these image-building efforts influence both franchise value and the transmission of monetary policy. They find substantial heterogeneity in advertising strategies across banks, reflecting differences in market share, productivity, deposit rates, service quality, and customer demographics. These strategic choices amplify differences in market power and financial stability across institutions, potentially shaping how banks respond to macroeconomic shocks and participate in the transmission of monetary policy.
Research Paper Session 2
Failed Banks
Supervising Failing Banks
When Banks Fail: Depositor Attention and the Cost of Funding for Survivors
Author: Brian Jonghwan Lee, Emory University
Key Findings: The authors document a novel channel through which bank failures affect the economy by increasing the funding costs of surviving banks. They find that competitor banks significantly raise deposit rates following a nearby bank failure, even when controlling for local economic conditions and bank fundamentals. The effect is persistent, lasting up to three years, and is stronger following highly publicized failures. Their findings highlight how banking crises propagate indirectly by making funding more expensive, even if remaining banks are safe, thereby constraining credit supply and amplifying economic downturns. Depositors play a central role in this propagation mechanism.
Bad Bank, Bad Luck? Evidence from 1 Million Firm-Bank Relationships
Research Paper Session 3
Innovation and Technology in Small Business Lending
U.S. Banks’ Artificial Intelligence and Small Business Lending: Evidence from the Census Bureau’s Technology Survey
Regulation Meets Technology: Evolution of Small Business Lending in Underserved Areas since 2007
Data as Collateral: Open Banking for Small Business Lending