Financial reform and mortgage lending by systemically important financial institutions
Persistent URL
Author(s)
Bianco, Timothy
Cornwall, Gary
Sauley, Beau
Date Issued
September 29, 2025
Abstract
We use proprietary transaction-level data from Intercontinental Exchange to examine how the Dodd–Frank Wall Street Reform and Consumer Protection Act (DFA) affected mortgage risk-taking by the six largest US financial institutions (SIFIs). Following DFA, these banks originated fewer mortgages, with lower average loan-to-value (LTV) ratios, and fewer high-LTV mortgages compared to other lenders. Our findings suggest that DFA curtailed risk taking among SIFIs but coincided with increased high-LTV lending by non-SIFIs, indicating a redistribution of risk to less regulated institutions. We provide the first transaction-level evidence linking DFA to measurable shifts in mortgage risk.
Journal
Economics Letters
Department
Business and Economics
Citation
Bianco, Timothy, Gary Cornwall, and Beau Sauley, "Financial Reform and Mortgage Lending by Systemically Important Financial Institutions," Economics Letters (2025): 112633, doi:10.1016/j.econlet.2025.112633. https://www.sciencedirect.com/science/article/pii/S0165176525004707.
Publisher
Elsevier
Version of Article
Published version
DOI
10.1016/j.econlet.2025.112633
ISSN
0165-1765
1873-7374
Rights
© 2025 The Authors. Published by Elsevier B.V.
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