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The recent financial crisis has shown how interconnected the financial world has become. Shocks in one location or asset class can have a sizable impact on the stability of institutions and markets around the world. But systemic risk analysis is severely hampered by the lack of consistent data...
Persistent link: https://www.econbiz.de/10013098136
We study the resolution of global banks by national regulators. Single-point-of-entry (SPOE) resolution, where loss-absorbing capital is shared across jurisdictions, is efficient but may not be implementable. First, when expected transfers across jurisdictions are too asymmetric, national...
Persistent link: https://www.econbiz.de/10012916183
In 1997, the Mexican government reversed long-standing policies and allowed foreign banks to purchase Mexico's largest … the ownership structure of Mexico's banks. For instance, while in 1991 only one percent of bank assets in Mexico were … been as rapid or as far-reaching as in Mexico. In this work we examine some of the important implications of foreign bank …
Persistent link: https://www.econbiz.de/10013088399
. The data on the compliance of domestic and foreign banks with the dollar reserve requirements in Mexico is used to try to …
Persistent link: https://www.econbiz.de/10013238693
Activities of international banks have been at the core of discussions on the causes and effects of the international financial crisis. Yet we know little about the actual magnitudes and mechanisms for transmission of liquidity shocks through international banks, including the reasons for...
Persistent link: https://www.econbiz.de/10013312517
We study risk management in financial institutions using data on hedging of interest rate and foreign exchange risk. We find strong evidence that institutions with higher net worth hedge more, controlling for risk exposures, both across institutions and within institutions over time. For...
Persistent link: https://www.econbiz.de/10012889497
Over the last twenty years, the consensus view of systemic risk in the financial system that emerged in response to the banking crises of the 1930s and before has lost much of its relevance. This view held that the main systemic problem is runs on solvent banks leading to bank panics. But...
Persistent link: https://www.econbiz.de/10012767554
This paper examines how governance and risk management affect risk-taking in banks. It distinguishes between good risks, which are risks that have an ex ante private reward for the bank on a stand-alone basis, and bad risks, which do not have such a reward. A well-governed bank takes the amount...
Persistent link: https://www.econbiz.de/10013051309
This essay shows that government credit-allocation schemes generate incentive conflicts that undermine the quality of bank supervision and eventually produce banking crisis. For political reasons, most countries establish a regulatory culture that embraces three economically contradictory...
Persistent link: https://www.econbiz.de/10012772313
EU financial safety nets are social contracts that assign uncertain benefits and burdens to taxpayers in different member countries. To help national officials to assess their taxpayers' exposures to loss from partner countries, this paper develops a way to estimate how well markets and...
Persistent link: https://www.econbiz.de/10012759547