Can depositors exert market discipline in the United Kingdom and Turkish banking systems?

Market discipline in the banking sector, which is the ability of private sector agents to discipline bank behaviour by pricing their debt according to their risk profile, has gathered significant attention from both regulators and academics in recent years. Despite conflicting ideas about the optima...

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Bibliographic Details
Main Author: F. Ipek Eksi
Format: Dissertation
Language:English
Subjects:
Business and Management not elsewhere classified
Other commerce, management, tourism and services not elsewhere classified
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Summary:Market discipline in the banking sector, which is the ability of private sector agents to discipline bank behaviour by pricing their debt according to their risk profile, has gathered significant attention from both regulators and academics in recent years. Despite conflicting ideas about the optimal way on how to attain market discipline in the banking sector, it is agreed that traditional supervisory methods have to be complemented with market forces. The literature on market discipline is usually on the US banking sector. The contribution of this thesis to the literature is achieved by extending the analysis to the UK and Turkish banking sectors and by looking at the subject from a depositor's angle. The purpose of this thesis is to analyse and to empirically test to what extent depositor market discipline exists in the UK and Turkey. To do this, a survey method, namely the questionnaire, was conducted and then analysed by descriptive analysis and statistical significance testing. [Continues.]