|Source: Compiled by the author.|
It is therefore concluded that the market was very efficient in assimilating the news of international defaults. Since the regional consumer banks were unaffected by the international debt crisis, we can also conclude that there is little evidence to support the "pure contagion effect hypothesis." At the same time, the loss of equity value for the multinational banks does not support the view that investors perceived an implicit federal guarantee of these institutions. These results are also consistent with Cornell and Shapiro and Aharoney and Swary.