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likelihood to issue equity. In contrast to this view, for an international sample of bank Seasoned Equity Offerings (SEOs), we …
Persistent link: https://www.econbiz.de/10011182990
There is general agreement that banking supervision and resolution have to be organised at the same level. It is often argued, however, that there is no need to tackle deposit insurance because it is politically too sensitive. This note proposes to apply the principles of subsidiarity and...
Persistent link: https://www.econbiz.de/10010927996
-Bond convert into equity once the equity ratio falls below a certain threshold and CoSu-Bond holders take over the bank while …
Persistent link: https://www.econbiz.de/10010957293
We examine bank-level changes in the relationship between earnings and loan loss provisioning, a measure of earnings … management, following the tightening of accounting constraints associated with the SEC's 1998 SunTrust Bank decision. By … exploiting both temporal variation in the regulatory environment and cross-sectional variation in bank ownership structure, we …
Persistent link: https://www.econbiz.de/10011209907
literature. This paper seeks to study the determinants of bank asset quality and profitability using panel data techniques and … contrary to the general perception. Similarly, with regard to rural bank branches, the results reveal that aversion to rural …
Persistent link: https://www.econbiz.de/10011263002
The publication of the second document on bank regulation by the Bank for International Settlements (BIS) paved the way …
Persistent link: https://www.econbiz.de/10010552020
The paper examines a continuous-time delegated monitoring problem between a competitive investor and an impatient bank … monitoring a pool of long-term loans subject to Markovian "contagion." Moral hazard induces a foreclosure bias unless the bank is … compensated with the right incentive-compatible contract. Fees are paid when the bank's performance is on target and liquidation …
Persistent link: https://www.econbiz.de/10010815979
After analyzing the different reasons why the financial system and also the regulatory framework induced procyclicality, this paper reviews the experiences of three countries which have introduced dynamic provisioning as a regulatory tool to limit procyclicality. The case of...
Persistent link: https://www.econbiz.de/10008550310
Contingent capital (cocos) instruments are debt securities that automatically co vert into equity if a predetermined trigger (given in terms of equity price or capit ratio) is breached. The dynamic incentive feature of a properly designed continge capital would encourage effective risk...
Persistent link: https://www.econbiz.de/10011157729
In order to reduce the exchange-rate risk, banks in emerging markets are typically denominating their loans in foreign currencies. However, in the event of a substantial depreciation of the local currency, the payment ability of a foreign-currency borrower may be reduced significantly, exposing...
Persistent link: https://www.econbiz.de/10011039116