Abstract
In a recent issue of this journal, Mingo (1978) analyzed the effect of deposit-rate ceilings on bank risk. The analysis showed that deposit-rate ceilings increase a bank's total risk. The purpose of this note is to examine a different but related question: Is systematic risk affected by Regulation Q ceilings ceteris paribus? The results of our empirical test indicate that systematic risk is not affected by deposit-rate ceilings. Taken together then, Mingo's and the present results show that removal of deposit-rate ceilings would not increase bank risk.
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