01Learning from peers: Evidence from disclosure of
consumer complaintsYiwei Dou, Mingyi Hung, Guoman She, Lynn
Linghuan WangAbstract：In 2013, the U.S. Consumer Financial Protection Bureau released a
database of consumer complaints filed against banks under its supervision
(“CFPB banks”). We find that after the disclosure, rival banks exhibit a
greater increase in mortgage approval rates in markets with more intensive
mortgage complaints about CFPB banks. The effect is weaker when rivals have
more expertise in the local market, are less concerned about credit risk due to
mortgage sales, and locate in areas with more alternative information about the
CFPB banks. The effect is concentrated in severe complaints and complaints
related to loan underwriting practices. In addition to approving more loans,
rivals also open more branches and are more likely to post a job opening in
these markets. The findings suggest that these banks learn from the
nonfinancial disclosures about operationa
………………………………
