Trademark confusion influences US depositors, Fed paper finds
Federal Reserve Board researchers find a similar name to a failed bank decreases deposits
US depositors are confused by banks with similar names when choosing lenders, research published by the Federal Reserve Board finds.
Banks that share a similar name with a failed bank receive less deposits, but banks with similar asset characteristics to the failed bank do not, they write. One in five banks in the US share a similar name, say Ryuichiro Izumi, Antonis Kotidis, and Paul Soto in the paper.
“We find that banks that share their name with a failed bank experience a half per cent drop
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