Measures of the Riskiness of Banking Organizations: Subordinated Debt Yields, Risk-based Capital, and Examination Ratings
The paper empirically analyzes potential costs and benefits of using subordinated debt signals to trigger prompt corrective action. Of particular interest is the potential for improved risk management for larger, complex institutions most often associated with systemic risk.
Link
http://www.frbatlanta.org/frbatlanta/filelegacydocs/wp0125.pdf