The Swedish Finance Company Crisis — could it have been anticipated?
Year: 2002
Type: article
Abstract: The Swedish finance company crisis was a kind of "run" that happened in September, 1990. It marked the beginning of the Swedish banking crisis of the early 1990's. The crisis was initially focused on the finance company Nyckeln. The specific negative information about Nyckeln is identified, as well as how it spread to the banks that were involved in lending to that company. The main part of the paper then inquires whether there were warning signs of the forthcoming crisis, in capital market information and other public information, mainly by means of the event study methodology. The data that is used includes indices for the banking industry and the real estate and construction industry, and share prices and trading volume for finance companies. The conclusion is that the crisis really came as a surprise, with very little advance warning. This paper hence does not support the idea that monitoring of banks and other financial institutions by financial market participants could replace government supervision.
Author: L. Peter Jennergren
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W3121136639