Bank CEO incentives and the credit crisis

• 成果类型: Article
• 署名作者: Fahlenbrach, Ruediger; Stulz, Rene M.
• 署名单位: University System of Ohio; Ohio State University; Swiss Finance Institute (SFI); Swiss Federal Institutes of Technology Domain; Ecole Polytechnique Federale de Lausanne; National Bureau of Economic Research; European Corporate Governance Institute
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2010.08.010
• 发表日期: 2011
• 页码: 11-26
• 关键词: FINANCIAL CRISIS; ceo compensation; ceo incentives; Insider trading

摘要

We investigate whether bank performance during the recent credit crisis is related to chief executive officer (CEO) incentives before the crisis. We find some evidence that banks with CEOs whose incentives were better aligned with the interests of shareholders performed worse and no evidence that they performed better. Banks with higher option compensation and a larger fraction of compensation in cash bonuses for their CEOs did not perform worse during the crisis. Bank CEOs did not reduce their holdings of shares in anticipation of the crisis or during the crisis. Consequently, they suffered extremely large wealth losses in the wake of the crisis. (C) 2010 Elsevier B.V. All rights reserved.