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Publications:
The Carrot and the Stick: Bank Bailouts and the Disciplining Role of Board Appointments
(with Loriana Pelizzon, Vincenzo Pezone and Anjan Thakor)
American Economic Journal: Economic Policy, 16 (4): 415–62
Media Coverage: The Harvard Law School Forum on Corporate Governance
Abstract: We empirically examine the Capital Purchase Program (CPP) used by the US government to bail out distressed banks with equity infusions during the Great Recession. We find strong evidence that a feature of the CPP – the government’s ability to appoint independent directors on the board of an assisted bank that missed six dividend payments to the Treasury – helped attenuate bailout-related moral hazard. Banks were averse to these appointments – the empirical distribution of missed payments exhibits a sharp discontinuity at five. Director appointments by the Treasury led to improved bank performance, lower CEO pay, and higher stock market valuations.
Best Paper Award: Conference on Asia-Pacific Financial Markets 2021
Young Researchers Award: International Risk Management Conference 2021
Presented at: Washington St. Louis Finance Brown Bag Seminar (2021)*, SAFE Brown Bag Seminar(2021), Tilburg University(2021)*, Finance Forum (2021)*, MoFiR Workshop on Banking (2021), NBER Summer Institute (2021)*, Fixed Income and Financial Institution Conference (2021)*, International Risk Management Conference (2021), Norges Bank-CEPR Workshop "Frontier Research in Banking" (2021)*, Annual Conference on Asia-Pacic Markets (2021)*, University of Szczecin FinSem (2021), Midwest Finance Association Annual Meeting (2022), Bank of Italy and Bocconi University Conference on Financial Stability and Regulation (2022)*, SFS Cavalcade (2022)*, FIRS Conference (2022), Global Finance Conference (2022), European Finance Association Annual Meeting (2022), Central Bank Research Association Annual Meeting (2022)*, VfS Annual Meeting (2022), DGF Annual Meeting (2022)
* Presented by Co-Author
Working Papers
Abstract: This paper analyzes the impact of disclosures of sustainable investment targets under the EU Sustainable Finance Disclosure Regulation (SFDR) on mutual fund flows. Using a staggered difference-indifferences setup and focusing on retail-oriented index funds, we find that sustainable investment targets have a temporarily positive impact on fund flows in comparison to funds without sustainable investment targets. Furthermore, we find a negative linear relationship between sustainable investment targets and fund flows. While lower targets attract higher fund inflows, higher targets result in significantly lower or even no inflows. Our results suggest that up to a target level of 20% in sustainable investments, index funds can attract more inflows. This suggests a trade-off between sustainability commitments and performance considerations.
Presented at: Finance Forum (2025), Bank of Lithuania Research Seminar (2025)
SAFE Working Paper No. 392, Latest version available here
Media Coverage: - Börsen-Zeitung
- Zeitschrift für das gesamte Kreditwesen
Abstract: This paper studies the impact of banks’ dividend restrictions on the behavior of banks’ institutional investors. Using an identification strategy that relies on the within-investor variation and a difference in difference setup, I find that mutual funds, in particular high dividend-paying funds, decrease their ownership shares at treated banks during the 2020 payout restrictions in the Eurozone. This decrease is not reversed after the abrogation of the policy. Using data before the introduction of the ban reveals a positive relationship between fund ownership and banks’ dividend yield, highlighting the importance of dividends for European banks’ fund investors. This reaction has also pricing implications as suggested by a negative relationship between payout restriction announcement cumulative abnormal returns and the percentage of fund owners per bank.
Presented at: SAFE Brown Bag Seminar (2022), Goethe University Brown Bag Seminar (2023), Nova SBE Finance PhD Final Countdown (2023), Day-Ahead PhD Workshop on Financial Intermediation (2023), ESCP Business School (2024), the Bank of Spain (2024), CEMFI (2024), Bayes Business School (2024), the Bank of Italy (2024), BIS-CEPR-SCG-SFI Conference on Financial Intermediation (2024), FMA European Conference (2024)
Other Work
Mind the liquidity gap: a discussion of money market fund reform proposals (2022)
(with Michael Grill, Luis Molestina Vivar, Charles O’Donnell, Sean O’Sullivan, Micheal Wedow, Moritz Weis, Christian Weistroffer)
Abstract: This article assesses proposed reforms to the European Money Market Funds (MMF) Regulation to enhance the resilience of the sector. Specifically, the article provides a rationale for requiring private debt MMFs to hold higher levels of liquid assets, of which a part should be public debt, and considers the design and calibration of such a requirement. The article also proposes that the impediments to the use of liquidity buffers should be removed and authorities should have a role in releasing these buffers. Finally, while the removal of a stable net asset value for low-volatility MMFs would reduce cliff effects, we argue that this might not be necessary if liquidity requirements for these private debt MMFs are sufficiently strengthened.
Quo Vadis Sustainable Funds? Sustainability and taxonomy-aligned disclosure in Germany under the SFDR (2023)
(with Nikolai Badenhoop, Angelina Hackmann, Loriana Pelizzon)
Media Coverage: Börsen-Zeitung
Abstract: This paper analyzes the current implementation status of sustainability and taxonomy-aligned disclosure under the Sustainable Finance Disclosure Regulation (SFDR) as well as the development of the SFDR categorization of funds offered via banks in Germany. Examining data provided by WM Group, which consists of more than 10,000 investment funds and 2,000 index funds between September 2022 and March 2023, we have observed a significant proportion of Article 9 (dark green) funds transitioning to Article 8 (light green) funds, particularly among index funds. As a consequence of this process, the profile of the SFDR classes has sharpened, which reflects an increased share of sustainable investments in the group of Article 9 funds. When differentiating between environmental and social investments, the share of environmental investments increased, but the share of social investments decreased in the group of Article 9 funds at the beginning of 2023. The share of taxonomy-aligned investments is very low, but slightly increasing for Article 9 funds. However, by March 2023 only around 1,000 funds have reported their sustainability proportions and this picture might change due to legal changes which require all funds in the scope of the SFDR to report these proportions in their annual reports being published after 1 January 2023.
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