00000nam 2200000zi 4500 9.902917 CaOODSP 20221107180109 m o d f cr |n||||||||| 210827t20212021oncd ob f|0| 0 eng d CaOODSP eng rda CaOODSP n-cn--- FB3-5/2021-30E-PDF Ahnert, Toni, author. Bank runs, bank competition and opacity / by Toni Ahnert and David Martinez-Miera. Ottawa, Ontario, Canada : Bank of Canada = Banque du Canada, 2021. ©2021 1 online resource (iii, 50 pages) : charts. text txt rdacontent computer c rdamedia online resource cr rdacarrier Staff working paper = Document de travail du personnel, 1701-9397 ; 2021-30 "Last updated: June 22, 2021." Includes bibliographical references (pages 37-41). "We model the opacity and deposit rate choices of banks that imperfectly compete for uninsured deposits, are subject to runs, and face a threat of entry. We show how shocks that increase bank competition or bank transparency increase deposit rates, costly withdrawals, and thus bank fragility. Therefore, perfect competition is not socially optimal. We also propose a theory of bank opacity. The cost of opacity is more withdrawals from a solvent bank, lowering bank profits. The benefit of opacity is to deter the entry of a competitor, increasing future bank profits. The excessive opacity of incumbent banks rationalizes transparency regulation"--Abstract, page iii. Bank failures. Competition. Banques Faillites. Compétitivité (Économie) Bank of Canada, issuing body. Staff working paper (Bank of Canada) 2021-30. (CaOODSP)9.806221 PDF 880 KB https://publications.gc.ca/collections/collection_2021/banque-bank-canada/FB3-5-2021-30-eng.pdf