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A Model For The Intervention Of A Financial Crisis

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  • Janice M. Barrow

Abstract

This paper builds a model for intervention and/or mitigation of a financial crisis by first identifying those conditions precedent to a systemic based financial crisis, and then outlying a process to integrate firm specific and systematic risk into a comprehensive strategic model. A simple application of the model was able to identify significant outliers. For example, using 2006 to 2010 data, Capital One Financial Corporation was identified for intervention from as early as 2006. This corporation received $3.56 billion of the Emergency Economic Stabilization Act Federal bailout funds.

Suggested Citation

  • Janice M. Barrow, 2012. "A Model For The Intervention Of A Financial Crisis," Global Journal of Business Research, The Institute for Business and Finance Research, vol. 6(2), pages 41-48.
    • Handle: RePEc:ibf:gjbres:v:6:y:2012:i:2:p:41-48
    as

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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Systematic risk; financial crisis; banking; reform; failure; regulation; capital; interconnectedness; macro-prudential; micro-prudential;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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