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Unformatted text preview: In 2011, 66% of failed banks were “significantly undercapitalized” (capital well below required levels) for at least 6 months, compared to 29% for 2010, suggesting that regulators are letting troubled banks languish much longer before closing them. Questions: 1. Are regulators actually getting easier on banks? Why might they do this? Why don’t they just admit it? 2. Is it a good idea to be easier on banks now? Should they have been easier during the depths of the crisis rather than now? 3. Is banking industry capacity to lend increased or decreased by closing failing banks and transferring the assets and deposits to healthier banks?...
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This note was uploaded on 02/17/2012 for the course FINA 465 taught by Professor Berger during the Spring '11 term at South Carolina.
- Spring '11