“Do Bond Spreads Show Evidence of a Too Big to Fail Effect?” is the second working paper in a series of independent research conducted and released by Oliver Wyman. The study finds clear evidence that by 2013 any funding cost differences among banks that existed in prior years have disappeared, and that any remaining differences could be due to factors other than TBTF perceptions. These findings strongly suggest that recent regulatory reforms have dramatically changed market perceptions of risk and funding costs today.
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