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Market discipline, disclosure and moral hazard in banking
Disclosure, volatility, and transparency: and empirical investigation into the value of bank disclosure
The authors suggests that banks that are more forthcoming on basic balance-sheet items exhibit lower stock price volatility. About 600 banks in thirty-one countries over the 1993-2000 period are covered. The authors find that higher values of their disclosure index are associated with significantly lower stock return volatility and that volatility is also negatively associated with most of the individual items in the index, and conclude that increased disclosure may benefit bankers and bank supervisors.