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It is difficult to design and implement an effective safety net for banks, because overgenerous protection of banks may introduce a risk-enhancing moral hazard and destabilize the very system it is meant to protect. The safety net that policymakers design must provide the right mix of market and...
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This paper shows that banks overstate the value of distressed assets and their regulatory capital during the U.S. mortgage crisis. Banks' balance sheets overvalue real estate-related assets compared to the market value of these assets. Banks with large exposure to mortgage-backed securities also...
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integration. Using bank-level data for 80 countries for 1988-95, the authors examine the extent of foreign ownership in national … because of a different customer base, different bank procedures, and different regulatory and tax regimes. In developing … foreign share of bank ownership does indeed reduce profitability and overhead expenses in domestically owned banks - so the …
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