Market discipline in the banking sector, which is the ability of private sector agents
to discipline bank behaviour by pricing their debt according to their risk profile, has
gathered significant attention from both regulators and academics in recent years.
Despite conflicting ideas about the optimal way on how to attain market discipline in
the banking sector, it is agreed that traditional supervisory methods have to be
complemented with market forces.
The literature on market discipline is usually on the US banking sector. The
contribution of this thesis to the literature is achieved by extending the analysis to the
UK and Turkish banking sectors and by looking at the subject from a depositor's
angle. The purpose of this thesis is to analyse and to empirically test to what extent
depositor market discipline exists in the UK and Turkey. To do this, a survey
method, namely the questionnaire, was conducted and then analysed by descriptive
analysis and statistical significance testing. [Continues.]
A Doctoral Thesis. Submitted in partial fulfilment of the requirements for the award of the degree of Doctor of Philosophy at Loughborough University.