We propose a methodology for measuring the market-implied capital of banks by subtracting from the market value of equity (market capitalization) a credit spread-based correction for the value of shareholders’ default option. We show that without such a correction, the estimated impact of a...

We analyze whether, and if so by how much, stable funding would have contributed to the financial soundness of German banks in the time period between 1995 and 2013, before the Basel III liquidity regulation to address excessive maturity mismatches in the wake of the financial crisis via the Net...

We analyze whether, and if so by how much, stable funding would have contributed to the financial soundness of German banks in the time period between 1995 and 2013, before the Basel III liquidity regulation to address excessive maturity mismatches in the wake of the financial crisis via the Net...

This study presents two tests of the hypothesis that adoption of an internal ratings-based approach to determining minimum capital requirements, proposed as part of the Basel II capital accord, would cause adopting banking organizations to increase their acquisition activity. The study employs...