Did SFAS 166/167 decrease the information asymmetry of securitizing banks?
Beginning in 2010, mandated Financial Accounting Standards No. 166 and 167 (SFAS 166/167) changed the consolidation rules of securitization entities and required more information about their securitization activities. I find that securitizing banks experienced a decrease in information asymmetry fro...
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Published in | The Financial review (Buffalo, N.Y.) Vol. 55; no. 4; pp. 557 - 581 |
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Main Author | |
Format | Journal Article |
Language | English |
Published |
Knoxville
Wiley Subscription Services, Inc
01.11.2020
Blackwell Publishing Ltd |
Subjects | |
Online Access | Get full text |
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Summary: | Beginning in 2010, mandated Financial Accounting Standards No. 166 and 167 (SFAS 166/167) changed the consolidation rules of securitization entities and required more information about their securitization activities. I find that securitizing banks experienced a decrease in information asymmetry from the pre‐ to the post‐SFAS 166/167 periods, and that more visible securitizing banks are less sensitive to SFAS 166/167. These inferences are robust to a number of sensitivity analyses. This study is one of the first to provide evidence of the effects of SFAS 166/167 on the information asymmetry of securitizing banks. |
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Bibliography: | This paper is based on the author's dissertation at the New York University. The author greatly appreciates the invaluable guidance and support from her dissertation committee members: Yakov Amihud, Mary Billings, Michael Jung, Joshua Ronen (chair), and Stephen Ryan. An earlier version of this paper was circulated under the title: “Did FAS 166/167 Improve the Transparency of Securitizing Banks?”. |
ISSN: | 0732-8516 1540-6288 |
DOI: | 10.1111/fire.12217 |