Renouf Publishing Co. Ltd.
embedded image
Renouf
Online Bookstore

ABOUT SSL CERTIFICATES

 
Quick Search
for: 
in 
 
Advanced search
F.A.Q.
Featured books
New in print
Best Sellers
President's picks

Shopping cart/Checkout  [0]
Sign-up for eUpdates
Tech in Fin before FinTech
Blessing or Curse for Financial Stability?

by Nicola Pierri and Yannick Timmer

Series:Working Paper No. 20/14
ISBN 9781513519258
Code: #WPIEA2020014

Publication year: 2020

Cdn: $27.00; US: $25.00
Paperback
Language: English
43 pages
Add to cart
Motivated by the world-wide surge of FinTech lending, we analyze the implications of lenders’ information technology adoption for financial stability. We estimate bank-level intensity of IT adoption before the global financial crisis using a novel dataset that provides information on hardware used in US commercial bank branches after mapping them to their parent bank. We find that higher intensity of IT-adoption led to significantly lower non-performing loans when the crisis hit: banks with a one standard deviation higher IT-adoption experienced 10% lower non-performing loans. High-IT-adoption banks were not less exposed to the crisis through their geographical footprint, business model, funding sources, or other observable characteristics. Loan-level analysis indicates that high-IT-adoption banks originated mortgages with better performance and did not offload low-quality loans. We apply a simple text-analysis algorithm to the biographies of top executives and find that banks led by more “tech-oriented” managers adopted IT more intensively and experienced lower non-performing loans during the crisis. Our results suggest that technology adoption in lending can enhance financial stability through the production of more resilient loans.
Tech in Fin before FinTech
Cdn: $27.00; US: $25.00
International Monetary Fund (IMF) BookID: 126995 Added: 2020.2.9