When does the general public lose trust in banks?

Working Papers

Gepubliceerd: 20 november 2013

Door: David-Jan Jansen Robert Mosch Carin van der Cruijsen

When does the general public lose trust in banks? We provide empirical evidence using responses by Dutch survey participants to eight hypothetical scenarios. We find that members of the general public care strongly about executive compensation. Negative media reports, falling stock prices, and opaque product information also affect trust in banks. Experiencing a bank bailout leads to less concern about government intervention, while experience of a bank failure leads to greater concern on bonuses.

Keywords: trust, banks, general public, financial crisis, survey data.
JEL classifcations: D12, D14, D18, G01, G21.