This paper presents a proposal for a regulatory regime aimed at reducing systemic risk effectively and internationally. Systemic relevance should be internalized with a levy (or tax), the level of which (or tax rate) rises with the systemic relevance of an institution (Pigouvian taxation). The...

This paper presents a proposal for a regulatory regime aimed at reducing systemic risk effectively and internationally. Systemic relevance should be internalized with a levy (or "tax"), the level of which (or "tax rate") rises with the systemic relevance of an institution (Pigouvian taxation)....

Using a theoretical model where financial advising is done by banks, we show one additional explanation for the stockholding puzzle. Thus, we hypothesize that in countries with high level of relationship banking more households invest in riskfree assets

The proposal “Convertible/Bail-inable Dividend Bonds“ aims to reduce limited liability of bank owners: We propose that part (or the whole) dividends of the banks are not paid out cash to the equity holders. The dividends of the banks are given to the supervisory authority, which issues...

The paper analysis the effect of the proposal “Convertible/ Bail-inable Dividend Bonds“ (Doluca, 2023) on inefficient risk-taking behavior of a bank that is acting in a Monopoly. The approach “Convertible/Bail-inable Dividend Bonds “propose that part (or the whole) dividends of the banks...

Before the beginning of the euro-area crisis, fees (premiums) for Credit Default Swaps (CDS) for the same entity (country) but nominated in different currencies were nearly equal. This is still true for non-euro area countries during the crisis; but these differences increased dramatically for...

This paper analyzes by using a simple theoretical model and thereafter testing empirically the differences between Euro- and US-Dollar nominated sovereign bonds of euro-area countries during the euro-crisis and concludes that the probability of collapse of the Euro(-currency) has a significant...

Being a systemically important financial institution may lead to lower financing costs, often referred to as a "borrowing subsidy". Existing studies on determining financing subsidies are limited and have several shortcomings: they either use ordinal scaled ratings to measure the rating bonus of...

The problem of legacy information technologies in conjunction with the excessive risks associated with the implementation of huge information technologies such as Enterprise Resource Planning systems have a potential to lead to bank failures, and thus, financial instability. Hence, using a...

This paper presents a proposal for a regulatory regime aimed at reducing systemic risk effectively and internationally. Systemic relevance should be internalized with a levy (or tax), the level of which (or tax rate) rises with the systemic relevance of an institution (Pigouvian taxation). The...