This paper analyses the sources and uses of funds of a financial intermediary: banks. A bank's sources and uses of funds are embodied in its statement of financial position. The sources of funds are primarily deposits, borrowed capital and shareholders' funds while the primary uses are loans and...

Microfinance has passed a long way from micro-saving to micro-credit and this journey has created an unforgettable history of developing not only the rural people but also the urban poor too especially women. Though the concept “Microfinance” refers to small financial activities like saving,...

In this paper, we analyze the e ffect of the conversion price of CoCo bonds on equity holders' incentives. First, we use an option-pricing context to show that CoCo bonds can magnify equity holders' incentives to increase the riskiness of assets and decrease incentives to raise new equity in a...

Theory suggests that unhealthy banks exhibit more pronounced flight-to-quality behavior during financial crises and, hence, the infusion of capital through unhealthy banks is less effective in relieving the liquidity shocks of vulnerable borrowers. We test these predictions by investigating how...

We assess the determinants of banks' liquidity holdings using balance sheet data for nearly 7000 banks from 30 OECD countries over a ten-year period. We highlight the role of several bank-specific, institutional and policy variables in shaping banks' liquidity risk management. Our main question...

The interest rate risk is the degree of exposure of a bank's financial condition to adverse movements in interest rates. Changes in interest rates affect a bank's earnings by changing its net interest income and the level of other interest-sensitive income and operating expenses. Changes in...

The paper evaluates the impact of the new bank capital adequacy framework on the bank lending business model. Particularly, the first section compares the standardized approach with the internal rating based approach. The second section analyses the impact of the rating quantification and rating...

The gradual changes of the international and national financial system has increased risks that banks have to face and has required stronger and more accurate instruments to monitor, to measure and to manage credit risks. The Basel Committee on Banking Supervision has developed a new framework...