Sergey Sarkisyan

Assistant Professor of Finance

Fisher College of Business, The Ohio State University

Biography

Welcome!

I am an Assistant Professor of Finance at the Fisher College of Business at The Ohio State University. I graduated from the Wharton School at the University of Pennsylvania with Ph.D. in Finance.

My research interests include financial intermediation, monetary policy, and payment technologies. My recent research studies how payment technology impacts bank deposit markets and monetary policy.

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Working papers

Instant Payment Systems and Competition for Deposits

Sergey Sarkisyan

Revise and Resubmit, Review of Financial Studies

I study how financial technology reshapes competition among banks. I exploit quasi-random variation in exposure to the introduction of Brazil’s Pix, an instant payment system, and show that instant payments increase deposit competition. Small bank deposits rise relative to large banks because Pix allows small banks to offer payment convenience more similar to large banks. Since they become more competitive providing payment services, small banks reduce deposit rates relative to large banks. Finally, I estimate a deposit demand model and find that depositors' welfare increases with Pix. These findings suggest that universally available payment systems can foster banking competition.

Presented at: American Finance Association, Annual Conference of the Banco Central do Brasil, Armenian Economic Association, Bank of Canada Payments and Securities Settlement Workshop, Conference on the Economics of CBDC, Economics of Payments Conference, Financial Intermediation Research Society (FIRS), Georgia Tech - Atlanta Fed Household Finance Conference, NBER Summer Institute (Macro, Money, and Financial Frictions), Northern Finance Association, Princeton Conference on Resilience, SFS Cavalcade North America, University of Western Australia Blockchain and Cryptocurrency Conference, Wharton-INSEAD Doctoral Consortium, Bank of Israel, Boston College Carroll, Central Bank of Armenia, Columbia Business School, Federal Reserve Board of Governors, INSEAD, New York University Stern, Ohio State University Fisher, Peking University NSD, Rice University Jones, Stanford GSB, University of British Columbia Sauder, University of Chicago Booth, University of Illinois Gies, University of Virginia Darden

Mentioned by: American Banker, The Banker, The Economist, Vox

Mentioned by the World Bank’s Digital Public Infrastructure Report

Monetary Policy and Financial Stability

Joao F. Gomes, Sergey Sarkisyan

How should monetary policy respond to evolving financial conditions? To answer this question, we develop and Bayesian estimate a dynamic macro model with a detailed financial sector and long-term defaultable nominal debt contracts to quantify how monetary policy response to movements in credit conditions can mitigate losses in aggregate consumption and output associated with macro fluctuations. We show that a (credible) monetary policy rule that includes credit spreads is often welfare-improving and generally obviates the need for explicit inflation targeting.

Presented at: Vanderbilt University*, Society for Economic Dynamics, Central Bank Research Association, China International Conference in Finance, European Finance Association, American Finance Association

*denotes presentation by co-author

Mentioned by: Knowledge@Wharton

Digital Payments and Monetary Policy Transmission

Pauline Liang, Matheus Sampaio, Sergey Sarkisyan

We examine the impact of digital payments on the transmission of monetary policy by leveraging administrative data on Brazil’s Pix, a digital payment system. We find that Pix adoption reduces banks' market power, making them respond more to changes in policy rates. We estimate a dynamic banking model in which digital payments amplify deposit demand elasticity. Our counterfactual results reveal that digital payments intensify the monetary transmission by reducing banks' market power – banks respond more to policy rate changes, and loans decrease more after monetary policy hikes. We find that digital payments impact monetary transmission primarily through deposit market power.

Presented at: SFS Cavalcade, HEC Banking in the Age of Challenges, European Finance Association, Global Poverty Research at Kellogg Conference, Northern Finance Association*, CAFRAL, Peking University NSD, Philadelphia Fed Fintech and Financial Institutions Research Conference, Annual Conference of the Banco Central do Brasil*, Bank of Italy, Bank of Canada Payments and Securities Settlement Workshop, Banco Central do Brasil, Swiss Finance Institute, Bocconi, CFEA at Michigan State University, Day-Ahead Conference at Philadelphia Fed, BPI/Columbia Bank Regulation Conference

*denotes presentation by co-author

Mentioned by: Valor Economico

The Network Structure of Money Multiplier

Ye Li, Yi Li, Sergey Sarkisyan, Huijun Sun

The role of deposits in the payment system creates both a liquidity constraint and a liquidity recycling mechanism for the banking system. When financing illiquid loans with deposits, a bank must rely on its liquid assets to cover depositors’ outgoing payments. Therefore, the “money multiplier”—the ratio of loans funded by deposits to liquid assets (i.e., the bank’s liquidity transformation relative to its liquidity base)—cannot be over-stretched. However, depositors’ incoming payments relax this liquidity constraint. We develop a structural model to estimate the overall impact of payments (money velocity) on money multiplier using confidential payment data from Fedwire. The network topology of interbank payment flows plays an important role and determines banks’ systemic importance for the equilibrium outcome.

Presented at: Boston College*, Boston Fed*, Chicago Fed*, Federal Reserve Board*, Frankfurt School of Finance & Management*, Hong Kong University*, INSEAD*, Imperial College London*, Nanyang Technological University*, National University of Singapore*, NYU Stern/Econ (joint)*, Philadelphia Fed*, Singapore Management University*, Stanford GSB*, Tilburg University*, UCLA Anderson*, University of Zurich*, UPenn Wharton*, Wharton Macro Seminar*, Advances in Micro-Finance and CMU*, American Finance Association*, Bank of Canada Conference on Networks in Modern Financial & Payments Systems*, Barcelona School of Economics Summer Forum*, CEPR ESSFM Gerzensee*, CESifo Conference on Money Macro and International Finance*, European Banking Center Network Conference*, European Finance Association*, Federal Reserve Board Conference on the Interconnectedness of Financial Systems*, Financial Intermediation Research Society*, Pacific Northwest Finance Conference*, U Minnesota Finance Junior Conference*, UNC Finance Junior Conference*, U Toronto Econ Junior Conference*

*denotes presentation by co-author

The ESG Divide: How Banks and Bondholders Differ in Financing Brown Firms

Irina Luneva, Sergey Sarkisyan

We study credit providers and costs of debt for firms with low ESG performance. First, we find that, while both banks and bondholders charge low-ESG borrowers a higher interest rate compared to high-ESG borrowers, the premium charged by banks is relatively lower. Second, while bondholders reduce the amount of financing when borrowers' ESG performance deteriorates, banks keep the size of their loans unchanged or even increase loans issued to low-ESG borrowers. We provide evidence that the difference in creditors' policies is driven by banks' superior information about how material borrowers' low ESG performance is and by lenders' different preferences regarding their borrowers' ESG performance.

Presented at: Central Bank Research Association*, China International Conference in Finance, Trans-Atlantic Doctoral Conference*, Alliance for Research on Corporate Sustainability UCLA Conference*, Northern Finance Association*, Peking University Guanghua

*denotes presentation by co-author

Mentioned by: Wharton ESG Initiative