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The answer to the question “what is money?” has changed throughout history. During the gold standard era, money was seen as gold or silver (the theory known as bullionism). In the early 20th century, the alternative theory known as chartalism proposed that money was a token chosen by the...
Persistent link: https://www.econbiz.de/10012856162
The Global Financial Crisis has shown that the international financial system is vulnerable to breakdown. The financial trilemma demonstrates that financial stability, international banking and national financial supervision cannot be combined. National supervisors force international banks to...
Persistent link: https://www.econbiz.de/10013084044
This paper uses branching and interstate banking deregulation as a natural experiment to explore the effect of agency cost on the use of bank loan commitments. A simple inventory-based model shows that lower agency cost facilitates more issuance of loan commitments because lower agency cost...
Persistent link: https://www.econbiz.de/10013133134
In a move towards effective management of interest rate risk in Indian banking, in addition to the existing return on Interest Rate Sensitivity under Traditional Gap Analysis, a new return is being introduced to monitor the interest rate risk using Duration Gap Analysis (DGA), called Interest...
Persistent link: https://www.econbiz.de/10013082007
Digitalization and Blockchain have fundamentally transformed the structure of the monetary system. The first wave of cryptocurrencies such as Bitcoin, Ethereum or Ripple have failed to gain relevance in terms of their share in monetary transactions. This was due to systemic deficiencies leading...
Persistent link: https://www.econbiz.de/10012840976
This paper examines relevancy of corporate financial policies and documents similarities and/or differences of how profit maximization goal is viewed by Islamic banking institutions (IBIs). Management of the firm is ultimately responsible for maximizing profits and increasing shareholder value,...
Persistent link: https://www.econbiz.de/10012908843
During the Global Financial Crisis, banks suffered losses on a scale not witnessed since the Great Depression, partly due to two major structural developments in the banking industry; deregulation combined with financial innovation. In the aftermath of the financial crisis, the regulatory...
Persistent link: https://www.econbiz.de/10012864778
Using a large contract-level, high frequency database of bank loan commitments from June 2007 to May 2009, we fi nd that fi rms' takedown behavior regarding credit lines is very di erent depending on the fi rms' creditworthiness. Usage patterns of rms with poor credit quality are more closely...
Persistent link: https://www.econbiz.de/10012976411
This is the fifth in a series of seven papers on interest rates and it covers the monetary policy models, a bank liquidity analysis, the concept of quantitative easing in terms of a bank liquidity analysis, and how a QE policy affects interest rates. The seven papers cover: (1) what are interest...
Persistent link: https://www.econbiz.de/10013039792
The deposit business differs at large versus small banks. We provide a parsimonious model and extensive empirical evidence supporting the idea that much of the variation in deposit-pricing behavior between large and small banks reflects differences in "preferences and technologies." Large banks...
Persistent link: https://www.econbiz.de/10014436996