We study loans from banking and non-banking lenders to different groups of borrowers in order to unveil significant differences on how those respond to a shock and evaluate possible alternative explanations for such differences. The objective is to gain insights useful to explain the loan...

We document a significant decline in the level of generalized trust among finance professionals relative to the decline of trust in the general U.S. population. This decline occurs across all subsectors and at all hierarchy levels and is unique to the finance industry. It is related to a lack of...

This paper illustrates channels by which regulations that require banks to hold liquid assets can either increase or decrease a bank's incentive to take risk with its remaining ineligible assets. A greater capacity to respond to liquidity stress increases the potential profits a bank would put...

I study broker-dealers' trading activity in the US corporate bond market. I find evidence of broker-dealer market making when customers both buy and sell a bond in a day, which happens half of the time: as predicted by market making theories with adverse selection or inventory costs, prices go...

This paper documents the long-run effects of an important reform of capital regulation for U.S. insurance companies in 2009. We show that its design effectively eliminates capital requirements for (non-agency) MBS, implying an aggregate capital relief of over $18bn at the time of the reform. By...

This working paper reviews the work of the Financial Stability Oversight Council (FSOC) in terms of identifying potential systemic risk in the nonbank sector under authority from the Dodd-Frank Wall Street Reform Act of 2010. We discuss past efforts by the agencies represented within the FSOC to...

We model the behavior of a hypothetical investor who is interested in U.S. securities but is also interested in compliance with Islamic Investment Guidelines. We apply financial restrictions to 1990-2010 sample of Shariah-recommended REITs. In cumulative performance tests, we find an evidence of...

Stock exchange operators compete for order flow by setting "make" fees for limit orders and "take" fees for market orders. When traders quote continuous prices, they can choose prices that perfectly neutralize any fee division, and traders stream to the exchange with the lowest total fee. The...

We use supervisory data to investigate the ex-ante credit risk taken by different types of lenders in the U.S. syndicated term loan market during the LSAPs period. We fi nd that nonbank lenders, mutual funds and structured-fi nance vehicles, take higher risk when longer-term interest rates...

While both size and complexity are important for the largest U.S. bank holding companies (BHCs), specific types of complexity and their patterns across banks are not well understood. We introduce a range of measures of organizational, business, and geographic complexity. Comparing 2007 with...