Question: How does the market price regulatory violations differently for digital versus traditional banks?

Data: Violation Tracker Global, FactSet RBICS, LSEG Datastream, OptionMetrics, IHS Markit

Target: J. Banking & Finance (Q4 2026)

Team:

• Lead: Dr. Sifat — Theory, design, manuscript

• Co-Author 1: Econometrics specialist — Data processing, statistical testing

• Co-Author 2: Markets expert — Options analysis, model formalization

Core Framework: Will integrate reputational capital theory with information-asymmetry signaling through formal modeling.

Key Channels:

Market Sequence: Options first → equity (t+1 to t+3) → CDS convergence by t+5

Sample: ~420 violation events across 26 jurisdictions (2010-2024)

Classification: FinTech typology spectrum based on business model, tech stack, and customer interface

IHS Markit Data: High-frequency pricing, CDS spreads, loan syndication, securities finance

Controls: Thomson Reuters News for contemporaneous events, regulatory regime markers

Power: Sample sized for detecting medium effects (d=0.5, β=0.8)

Causal Identification:

IV Approach: Geographic regulatory staffing and peer violations in non-overlapping markets

FinTech Focus: Platform economics model testing two-sided market effects

Academic: Will extend reputational capital theory to digital ecosystems with formal modeling of market discipline transmission

Regulatory: Will quantify “regulatory parity gap” and provide evidence for optimal penalties by business model

FinTech Industry: Will develop “Digital Trust Impact” framework with implications for business model resilience

Market: Will create “Misconduct Risk Premium” methodology and early warning indicators from options markets

May 2025: IHS Markit data contracts, FinTech typology development

Jul 2025: App analytics integration, RDD implementation

Sep 2025: DiD implementation, platform economics testing

Dec 2025: Main empirical results, digital trust analysis

Feb 2026: Pre-analysis plan registration (OSF)

Apr 2026: Conference submission (EFA)

Oct 2026: Journal submission

Business Models: Identify which FinTech models face larger violation penalties

Customer Acquisition: Quantify CAC impact and customer retention changes post-violation

Open Banking: Measure API integration resilience and ecosystem effects

Digital Trust: Framework for reputation management in digital financial services

Policy Design: Implications for activity-based vs. entity-based regulation