The new Hungarian Central Bank Act passed at the end of 2011 delegated macroprudential regulatory powers to the MNB. The essential elements of an effective macro-prudential policy are analytical tools which make it possible to quantify the effects arriving via different systemic risk channels...

Este escrito analiza por qué el tipo de regulación financiera compleja desarrollado en las últimas décadas puede ser una respuesta subóptima a la creciente complejidad del sistema financiero. Los ejemplos de otras disciplinas muestran que la toma de decisiones en un entorno complejo se...

This paper studies the factors that were associated with a bank's early exit from the Troubled Asset Relief Program (TARP) in 2009. Executive pay restrictions were often a rationale cited for early TARP exit, and high levels of CEO pay in 2008 were associated with banks being significantly more...

This paper finds that banks that offered lower opening bids were rewarded with significantly lower warrant repurchase prices in transactions that raised $2.856 billion in 2009. These results were scaled by third-party consultants’ and the Congressional Oversight Panel's estimates of the...

In crisis times, depositors get anxious, can run on banks, and withdraw their deposits. Correlated withdrawals of bank deposits could be mitigated if bank deposits are more diversified, i.e. held by more individuals. This paper examines the link between a broader access to bank deposits prior to...

Pierret (2015) presents empirical analysis of the solvency-liquidity nexus for the banking system, documenting that a shock to the level of banks’ solvency risk is followed by lower short-term debt. Conversely, higher short-term debt Granger-causes higher solvency risk. These results point...

This paper highlights the empirical interaction between solvency and liquidity risks of banks that make them particularly vulnerable to an aggregate crisis. I find that banks lose their access to short-term funding when markets expect they will be insolvent in a crisis. Conversely, the expected...

__Abstract__ In this paper, we develop a new capital adequacy buffer model (CABM) which is sensitive to dynamic economic circumstances. The model, which measures additional bank capital required to compensate for fluctuating credit risk, is a novel combination of the Merton structural model...

The fast innovations existent on financial markets and the internationalization of cash-flows in the last decade led to changes within the banking industry making it unrecognized. The financial innovation within the banking industry, especially the one regarding the off-balance-sheet instruments...

In the context of current debates about the proper form of prudential regulation and proposals for the imposition of liquidity and capital ratios, the paper examines Hyman Minsky’s work as a consultant to government agencies exploring financial regulatory reform in the 1960s. As the...