Showing 1 - 10 of 3,529
This paper presents a dynamic model of a bank's optimal choices of imposing a binding liquidity-coverage-ratio (LCR) constraint. Our baseline balance-sheet dynamics starts with portfolio separation and no LCR constraint. Under a scenario in which regulators prohibit banks from applying...
Persistent link: https://www.econbiz.de/10013076197
Persistent link: https://www.econbiz.de/10009522885
Persistent link: https://www.econbiz.de/10011793716
Especially structured finance instruments were blamed as main reason for the financial crisis 2007, but the understanding for the motivation to originate securitization products is less discovered. Therefor this paper tries to identify main balance sheet characteristics of structured finance...
Persistent link: https://www.econbiz.de/10008907723
Persistent link: https://www.econbiz.de/10003828399
We estimate the cost of capital for the banking industry and find that while the cost of capital soared for banks in the financial crisis, after the passage of the Dodd-Frank Act, the value-weighted cost of capital for banks fell differentially more than did the cost of capital for nonbanks. The...
Persistent link: https://www.econbiz.de/10011868475
Persistent link: https://www.econbiz.de/10001267300
Hub-and-spoke regulation, where a central regulator with legal power over firms delegates monitoring to local supervisors, can improve information collection, but can also lead to agency problems and capture. We document that following the closure of a US bank regulator's field offices, the...
Persistent link: https://www.econbiz.de/10012967849
Bank capital requirements are based on a mix of market values and book values. We investigate the effects of a policy change that ties regulatory capital to the market value of the "available-for-sale" investment securities portfolio for some banking organizations. Our analysis is based on...
Persistent link: https://www.econbiz.de/10012916682
To calculate regulatory capital ratios, banks have to apply adjustments to book equity. These adjustments vary with a bank's solvency position: Low solvency banks report values of Tier 1 regulatory capital that exceed book equity. These banks benefit from regulatory adjustments to inflate...
Persistent link: https://www.econbiz.de/10013063353