Using an international sample of more than 65,000 rating actions by Fitch, Moody's and S&P, we analyze the effect of the Dodd-Frank Act on credit ratings. We document that (i) rating report content changes significantly after Dodd-Frank and (ii) show, by exploiting within firm-quarter variation,...

Using fund-, firm- and bank-level data we investigate the investments of private equity (PE) funds in the north-western regions of Italy. Both the private equity fund managers and the PE investments are heavily concentrated in this most developed area of the country. The average size of the...

In 2018, the Insurance Distribution Directive (IDD) was fully implemented by all EU member states. It intends to harmonize the insurance market, provide the right incentives for the agents and protect the consumers. But why? The core business of the banking sector makes it necessary for a...

We study the effects of financial sanctions on cross-border credit supply. Using a differences-in-differences approach to analyze eleven sanctions episodes between 2002 and 2015, we find that banks located in Germany reduce their positions in countries with sanctioned entities by 38%. The...

We present a meta-analysis of the impact of higher capital requirements imposed by regulatory reforms on the macroeconomic activity (Basel III). The empirical evidence derived from a unique dataset of 48 primary studies indicates that there is a negative, albeit moderate GDP level effect in...

In the expansionary phase of the economy (1995-2007) and, particularly after the Euro introduction, credit to the business sector increased significantly in Europe. According to surveys of the EC-Flash Eurobarometer (2005), over 77% of SMEs claimed to have appropriate funding levels. A number of...

We study the macroeconomic effects of bank capital requirements in an economy with two banking sectors. Banks are connected through a wholesale funding market. Anticipated banking crises occur endogenously in the form of self-fulfilling wholesale funding rollover crises. Retail bank capital...

How can tax policy improve financial stability? Recent studies point to large potential stability gains from a reform that eliminates the debt bias in corporate taxation. Such a reform reduces bank leverage. This paper emphasizes a novel, complementary channel: bank risk taking. We model the...

We examine insurance against loan default when lenders can screen in primary markets at a heterogeneous cost and learn loan quality over time. In equilibrium, low-cost lenders screen loans but some high-cost lenders insure them. Insured loans are risk-free and liquid in a secondary market, while...

When banks are faced with a funding shortage in money market wholesale funding, they partly substitute by tapping other wholesale funding sources. Using auction-level data on large corporate deposits, we trace these substitution effects and their implications, which go beyond the balance sheets...