We show that the impact of government bailouts (liquidity injections) on a representative bank’s risk taking depends on the level of systematic risk of its loans portfolio. In a model where bank’s output follows a geometric Brownian motion and the government guarantees bank’s liabilities,...

We show that the impact of government bailouts (liquidity injections) on a representative bank's risk taking depends on the level of systematic risk of its loans portfolio. In a model where bank's output follows a geometric Brownian motion and the government guarantees bank's liabilities, we...

This paper examines the prospect of revitalizing asset-backed and non-agency mortgage-backed securitization markets rendered nearly dormant in the wake of the 2008 financial crisis. First, it briefly summarizes the background of the debacle and presents historical parallels for context. Then the...

Credit default swaps ("CDSs") were widely blamed as a primary cause of the recent financial crisis; CDSs fomented panic as the price of credit protection spiked and contributed to the Federal Reserve's decision to bail out American International Group. To reduce the likelihood that credit...

The low level participation of the Islamic banks in mudharabah and musharakah financing models has become one of the problems in the development of the industry. This arrangements are unique to Islamic banking and account for its superiority over conventional banking on grounds of ethics and...

There has been large-scale growth in Islamic finance and banking in the last twenty five years and now reaching new levels of sophistication. However, a complete Islamic financial system with its identifiable instruments and markets is still very much at an early stage of evolution. Many...

The twentieth first century has witnessed resurgence in the observance of fundamental Islamic practices around the world. With it's significant potential and competitive form of financial intermediation, Islamic finance and banking has emerged and experiencing rapid expansion. However, it still...

This paper investigates a model of endogenous product differentiation in subprime lending markets. In the subprime literature the discussion surrounds two competing hypotheses about pricing behavior. The opportunity pricing hypothesis suggests that lenders are rent seeking in their pricing...

The continuous regressions in the per capita income of the Sudanese people have triggered many suggestions to ameliorate their productive capabilities. One of them was the facilitations in financing programs through official channels. However, there are many structural impediments that inhibit...

This report presents the findings of a global survey on AI in Financial Services jointly conducted by the Cambridge Centre for Alternative Finance (CCAF) at the University of Cambridge Judge Business School and the World Economic Forum in Q2-Q3 2019. Representing one of the largest global...