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Securitization : Lessons Learned and the Road Ahead

Segoviano Basurto, Miguel - 2014

This paper examines the financial stability implications arising from securitization markets, with one eye on the past … industry developments in the years before the crisis. Emphasis is placed on the various ways in which securitization markets … securitization markets are then discussed, including a treatment of various regulatory initiatives, the operational infrastructure of …

Persistent link: https://www.econbiz.de/10013060543

Can Short-Term Capital Controls Promote Capital Inflows?

Cordella, Tito - 2005

In an economy a la Diamond and Dybvig (1983), we present an example in which foreign lenders find it profitable to invest in an emerging market if, and only if, the emerging market government imposes taxes on short-term capital inflows. This implies that capital controls that are effective in...

Persistent link: https://www.econbiz.de/10012737725

Banking and Trading

Ratnovski, Lev - 2012

We study the effects of a bank's engagement in trading. Traditional banking is relationship-based: not scalable, long-term oriented, with high implicit capital, and low risk (thanks to the law of large numbers). Trading is transactions-based: scalable, shortterm, capital constrained, and with...

Persistent link: https://www.econbiz.de/10013098572

Assessing the Cost of Financial Regulation

Elliott, Douglas - 2012

This study assesses the overall impact on credit of the financial regulatory reforms in Europe, Japan, and the United States. Long-term cost estimates are provided for Basel III capital and liquidity requirements, derivatives reforms, and higher taxes and fees. Overall, average lending rates in...

Persistent link: https://www.econbiz.de/10013099136

How is the Likelihood of Fire Sales in a Crisis Affected by the Interaction of Various Bank Regulations?

Kirti, Divya - 2017

We present a model that describes how different types of bank regulation can interact to affect the likelihood of fire sales in a crisis. In our model, risk shifting motives drive how banks recapitalize following a negative shock, leading banks to concentrate their portfolios. Regulation affects...

Persistent link: https://www.econbiz.de/10012956306

Islamic Finance, Consumer Protection, and Financial Stability

Lukonga, Inutu - 2015

Consumer protection and financial literacy are essential pillars of a well functioning and stable financial system. As the global financial crisis demonstrated, inadequate attention to consumer protection and financial literacy can lead to financial instability. Though Shari'ah principles...

Persistent link: https://www.econbiz.de/10013021443

Bank Profitability and Risk-Taking

Martynova, Natalya - 2016

Traditional theory suggests that more profitable banks should have lower risk-taking incentives. Then why did many profitable banks choose to invest in untested financial instruments before the crisis, realizing significant losses? We attempt to reconcile theory and evidence. In our setup, banks...

Persistent link: https://www.econbiz.de/10012999745

The Nonlinear Relationship between Public Debt and Sovereign Credit Ratings

Hadzi-Vaskov, Metodij - 2019

This study investigates the nonlinear relationship between public debt and sovereign credit ratings, using a wide sample of over one hundred advanced, emerging, and developing economies. It finds that: i) higher public debt lowers the probability of being placed in a higher rating category; ii)...

Persistent link: https://www.econbiz.de/10012864106

Quantitative Easing and Credit Rating Agencies

Abidi, Nordine; Falagiarda, Matteo; Miquel-Flores, Ixart - 2022

This paper investigates the behaviour of credit rating agencies using a natural experiment in monetary policy. We exploit the corporate QE of the Eurosystem and its rating-based specific design which generates exogenous variation in the probability for a bond of becoming eligible for outright...

Persistent link: https://www.econbiz.de/10013405784

Competition vs. Stability : Oligopolistic Banking System with Run Risk

Capelle, Damien - 2022

This paper develops a model where large financial intermediaries subject to systemic runs internalize the effect of their leverage on aggregate risk, returns and asset prices. Near the steady-state, they restrict leverage to avoid the risk of a run which gives rise to an accelerator effect. For...

Persistent link: https://www.econbiz.de/10013305673

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