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Bank resolution and public backstop in an asymmetric banking union

Segura, Anatoli; Vicente, Sergio - 2018

of bail-outs. Raising public funds to conduct a bail-out entails the deadweight loss of distortionary taxation. Bank bail … domestic bank failures may be contemporaneous to sovereign crises, giving rise to risk-sharing motives to mutualize the funding … the public backstop and forbearance in early bank intervention in the fiscally stronger country, facilitating bail-outs in …

Persistent link: https://www.econbiz.de/10011978809

Cournot fire sales

Eisenbach, Thomas M.; Phelan, Gregory - 2018

In standard Walrasian macro-finance models, pecuniary externalities such as fire sales lead to overinvestment in illiquid assets or underprovision of liquidity. We investigate whether imperfect competition (Cournot) improves welfare through internalizing the externality and find that this is far...

Persistent link: https://www.econbiz.de/10011806238

Credit risk transfer and de facto GSE reform

Finkelstein, David L.; Strzodka, Andreas; Vickery, James - 2018

We summarize and evaluate Fannie Mae and Freddie Mac's credit risk transfer (CRT) programs, which have been used since 2013 to shift a portion of credit risk on more than $1.8 trillion of mortgages to private sector investors. We argue that the CRT programs have been successful in reducing the...

Persistent link: https://www.econbiz.de/10011806244

The prudential toolkit with shadow banking

Hachem, Kinda; Kunci, Martin - 2025 - Revised March 2025

Several countries now require banks or money market funds to impose state-contingent costs on shortterm creditors to absorb financial stress. We study these requirements as part of the broader prudential toolkit in a model with five key ingredients: banks may face an aggregate stress state with...

Persistent link: https://www.econbiz.de/10015329942

The importance of technology in banking during a crisis

Pierri, Niccola; Timmer, Yannick - 2021

direct role of IT adoption in strengthening bank resilience; these include instrumental variable estimates exploiting the …

Persistent link: https://www.econbiz.de/10012494252

Prudential policy with distorted beliefs

Dávila, Eduardo; Walther, Ansgar - 2021

This paper studies leverage regulation and monetary policy when equity investors and/or creditors have distorted beliefs relative to a planner. We characterize how the optimal leverage regulation responds to arbitrary changes in investors' and creditors' beliefs and relate our results to...

Persistent link: https://www.econbiz.de/10012704734

Electoral cycles in macroprudential regulation

Müller, Karsten - 2019

Do politics matter for macroprudential policy? I show that changes to macroprudential regulation exhibit a predictable electoral cycle in the run-up to 221 elections across 58 countries from 2000 through 2014. Policies restricting mortgages and consumer credit are systematically less likely to...

Persistent link: https://www.econbiz.de/10012135983

Is size everything?

Antill, Samuel; Sarkar, Asani - 2018

time series and the cross section. TSIZE-implied subsidies increase around the bailout of Continental Illinois in 1984 and …

Persistent link: https://www.econbiz.de/10011894404

Why are banks not recapitalized during crises?

Crosignani, Matteo - 2017

, in the context of the eurozone periphery, the increase in domestic government bond holdings, the reduction of bank credit …

Persistent link: https://www.econbiz.de/10011978342

Recapitalization, bailout, and long-run welfare in a dynamic model of banking

Modena, Andrea - 2020

Persistent link: https://www.econbiz.de/10012496762