McCombs School of Business
Austin, TX 78705
Institutional Affiliation: University of Texas at Austin
NBER Working Papers and Publications
|March 2020||Banking without Deposits: Evidence from Shadow Bank Call Reports|
with Gregor Matvos, Tomasz Piskorski, Amit Seru: w26903
Is bank capital structure designed to extract deposit subsidies? We address this question by studying capital structure decisions of shadow banks: intermediaries that provide banking services but are not funded by deposits. We assemble, for the first time, call report data for shadow banks which originate one quarter of all US household debt. We document five facts. (1) Shadow banks use twice as much equity capital as equivalent banks, but are substantially more leveraged than non-financial firms. (2) Leverage across shadow banks is substantially more dispersed than leverage across banks. (3) Like banks, shadow banks finance themselves primarily with short-term debt and originate long-term loans. However, shadow bank debt is provided primarily by informed and concentrated lenders. (4) Shad...