We examine whether banks’ interest in the well-being of their workforce, measured by an index of employee relations strengths, explains their default risk during the recent credit crisis. Using a sample of 179 U.S. banks, we find that banks with greater pre-crisis employee relations strengths experience lower default risk and have higher excess returns during the crisis. These banks have lower asset volatility and leverage, suggesting that bank default risk is mitigated through lowering operational and financial risks. Banks’ prudent risk-taking behavior benefits shareholders in times of heightened risk. The results are robust to alternative model specifications and endogeneity issues.

中文翻译：

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信用危机期间的员工待遇与银行违约风险

我们研究了银行对其员工福利的兴趣（以员工关系优势指数衡量）是否可以解释它们在最近的信贷危机期间的违约风险。使用 179 家美国银行的样本，我们发现危机前员工关系实力较强的银行在危机期间违约风险较低，超额回报较高。这些银行的资产波动性和杠杆率较低，这表明通过降低运营和财务风险来缓解银行违约风险。银行谨慎的冒险行为在风险增加时使股东受益。结果对于替代模型规范和内生性问题具有鲁棒性。