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Eleonora Sfrappini

Eleonora Sfrappini
Current Position

since 10/19

Economist in the Department of Financial Markets
 

Contributor International Banking Library

Halle Institute for Economic Research (IWH) – Member of the Leibniz Association

Research Interests
  • financial stability
  • financial markets and the real economy
  • International Banking Library

Eleonora Sfrappini joined the Department of Financial Markets as a doctoral student in October 2019. Her research focuses on the effect shocks have on financial stability and the resulting consequences on the real economy.

Eleonora Sfrappini received her bachelor's degree from Free University of Bozen-Bolzano and her master's degree from Julius-Maximilians-Universität Würzburg. She also spent a semester at Özyeğin University, Turkey.

Your contact

Eleonora Sfrappini
Eleonora Sfrappini
Mitglied - Department Financial Markets
Send Message +49 345 7753-723

Publications

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Working Papers

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Completing the European Banking Union: Capital Cost Consequences for Credit Providers and Corporate Borrowers

Michael Koetter Thomas Krause Eleonora Sfrappini Lena Tonzer

in: IWH Discussion Papers, No. 4, 2021

Abstract

The bank recovery and resolution directive (BRRD) regulates the bail-in hierarchy to resolve distressed banks without burdening tax payers. We exploit the staggered implementation of the BRRD across 15 European Union (EU) member states to identify banks’ capital cost and capital structure responses. In a first stage, we show that average capital costs of banks increased. WACC hikes are lowest in the core countries of the European Monetary Union (EMU) compared to formerly stressed EMU and non-EMU countries. This pattern is driven by changes in the relative WACC weight of equity in response to the BRRD, which indicates enhanced financial system resilience. In a second stage, we document asymmetric transmission patterns of banks’ capital cost changes on to corporates’ borrowing terms. Only EMU banks located in core countries that exhibit higher WACC are those that also increase firms’ borrowing cost and contract credit supply. Hence, the BRRD had unintended consequences for selected segments of the real economy.

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