Using Bank for International Settlements (BIS) data on cross-border bank flows across 128 countries and over two decades, we find that heightened bank flows are associated with improved financial stability in a recipient country's bank system. The reductions in marginal expected shortfall (MES)...

We seek to determine the sources and the extent of funding cost differences between Global Systemically Important Banks (G-SIBs) and non-G-SIBs in the U.S. We build on earlier studies that have asserted that G-SIBs have had lower funding costs, and have attributed this to an assumed...

We identify, measure and compare the characteristics of Global Systemically Important Banks (G-SIBs) vis-à-vis banks not chosen by the Financial Stability Board (FSB) to be in the 2011 G-SIB group; investors' responses to banks being classified as a G-SIB and how these responses relate to...

We examine the assertion that ratings from the ratings agencies that explicitly assume governmental support for Global Systemically Important Banks (G-SIBs) translate into lower spreads and a funding cost advantage for those G-SIBs. We analyze whether the market over the past 14 years in fact...

Fair value accounting has been argued as one contributing factor to the recent global financial crisis occurred from 2007 to 2008. However, recent empirical studies find no significant evidence for this role of fair value accounting. One reason for this inconsistency comes from the weaknesses of...

Global systemically important banks (GSIBs) are subject to capital surcharges that increase with systemic importance indicators. We show that U.S. GSIBs lower their surcharges to a large extent by reducing one indicator---the notional amount of over-the-counter derivatives---in the fourth...

The paper examines the basic rationale and features of the proposals adopted to separate specific investment and commercial banking activities (Volcker rule, Vickers and Liikanen proposals). In particular, it focuses on the likely implications of such initiatives for: (i) financial stability and...

We examine the spillover and direct effects of cross-border bank M&As on the systemic risk of banks in the target’s country. We document that higher cross-border bank M&A activity is associated with higher systemic risk for peer banks, while target banks exhibit a decrease in systemic risk...