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Screening in the credit market when the collateral value is stochastic
Niinimäki, Juha-Pekka - Suomen Pankki - 2009
This theoretical paper explores screening with loan collateral when both the collateral value and the probability of …-risk borrowers may in such case be more willing to pledge collateral than low-risk borrowers. Abundant collateral then would not … signal low risk. The results may help explain the mixed empirical findings on the role of collateral. The paper also extends …
Persistent link: https://www.econbiz.de/10005014554
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Moral hazard in the credit market when the collateral value is stochastic
Niinimäki, Juha-Pekka - Suomen Pankki - 2010
This theoretical paper explores the effects of costly and non-costly collateral on moral hazard, when collateral value … may fluctuate. Given that all collateral is costly, stochastic collateral will entail the same positive incentive effects … as nonstochastic collateral, provided the variation in collateral value is modest. If it is large, the incentive effects …
Persistent link: https://www.econbiz.de/10008800750
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Rating targeting and the confidence levels implicit in bank capital
Jokivuolle, Esa; Peura, Samu - Suomen Pankki - 2006
The solvency standards implicit in bank capital levels, as reported eg in Jackson et al (2002), are much higher than those required for top ratings, if standard single period economic capital models are taken se-riously. We explain this excess capital puzzle by forward looking rating targeting...
Persistent link: https://www.econbiz.de/10005207164
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Crisis performance of European banks – does management ownership matter?
Westman, Hanna - Suomen Pankki - 2014
Failure in bank corporate governance has been seen as a contributing factor to excessive risk-taking pre-crisis with devastating implications as risks realised during the financial crisis. Unfortunately, the empirical evidence on the impact of managerial incentives on bank crisis performance is...
Persistent link: https://www.econbiz.de/10011082590
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Risk-based classification of financial instruments in the Finnish statutory pension scheme TyEL
Tanskanen, Antti J; Niininen, Petri; Vatanen, Kari - Suomen Pankki - 2010
Sufficient solvency of a pension insurance company responsible for defined-benefit pensions guarantees that the pensions are paid regardless of turbulence in the financial market. In the Finnish occupational pension system TyEL, the required level of solvency capital (solvency limit) and its...
Persistent link: https://www.econbiz.de/10008516093
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Equilibrium in financial markets with adverse selection
Takalo, Tuomas; Toivanen, Otto - Suomen Pankki - 2003
We study a financial market adverse selection model where all agents are endowed with initial wealth and choose to invest as entrepreneurs or financiers, or not to invest. We show that often a lack of outside finance leads to the emergence of financial markets where availability of outside...
Persistent link: https://www.econbiz.de/10005648911
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Shadow banking : financial intermediation beyond banks
Adrian, Tobias; Chrétien, Edouard; Chui, Michael; … - Shadow Banking: Financial Intermediation beyond Banks …; … - 2018
Persistent link: https://www.econbiz.de/10011790739
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Banking after regulatory reforms - business as usual? : a joint publication with the Bank of Finland
Jokivuolle, Esa (ed., introduction);  … - SUERF/Bank of Finland Conference Banking after …; … - 2014
The 5th joint SUERF/Bank of Finland joint conference was held in Helsinki on 13 June 2013. The general theme of the conference was to focus on the regulatory reforms after the global financial crisis and, in particular, how structural reforms of banking ("Volcker, Vickers and Liikanen") could...
Persistent link: https://www.econbiz.de/10011711934
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Bank ownership structure, SME lending and local credit markets
Hasan, Iftekhar; Jackowicz, Krzysztof; Kowalewski, Oskar; … - Suomen Pankki - 2014
In this paper, by employing a novel approach, we study the relationship between bank type and small-business lending in a post-transition country. Using a unique dataset on bank branches and firm-level data, we find that local cooperative banks lend more to small businesses than do large...
Persistent link: https://www.econbiz.de/10010945118
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Optimal bank transparency
Moreno, Diego; Takalo, Tuomas - Suomen Pankki - 2012
Consider a competitive bank whose illiquid asset portfolio is funded by short-term debt that has to be refinanced before the asset matures. We show that in this setting maximal transparency is not socially optimal, and that the existence of social externalities of bank failures further lowers...
Persistent link: https://www.econbiz.de/10009651893