Corporate governance of banks and financial stability

Luc Laeven, Lev Ratnovski, 21 July 2014

a

A

Corporate governance is the practice of shareholders exercising control over managers so that they act in shareholders’ interests. In non-financial firms, this maximises firm efficiency. Such efficiency effects also exist in banks. For example, banks that face more active takeover markets are more cost-efficient (Brook et al. 1998).

Topics: Financial markets
Tags: bank regulation, corporate governance, systemic risk

Are banks too large?

Lev Ratnovski, Luc Laeven, Hui Tong, 31 May 2014

a

A

Large banks have grown significantly in size and become more involved in market-based activities since the late 1990s. Figure 1 shows how the balance-sheet size of the world’s largest banks increased two- to four-fold in the ten years prior to the crisis. Figure 2 illustrates how banks shifted from traditional lending towards market-oriented activities.

Topics: Financial markets
Tags: bank capital, bank regulation, bank resolution, banking, BASEL III, economies of scale, regulation, systemic risk, Too big to fail

Spillovers from systemic bank defaults

Mark Mink, Jakob de Haan, 24 May 2014

a

A

Financial-crisis management and prevention policies often focus on mitigating spillovers from the default of systemically important banks. During the recent crisis, governments avoided large bank failures by insuring and purchasing intermediaries’ troubled assets, by providing them with capital injections, and even by outright nationalisations.

Topics: Financial markets
Tags: banking, banks, financial stability, regulation, spillovers, systemic risk

Exploring the transmission channels of contagious bank runs

Martin Brown, Stefan Trautmann, Razvan Vlahu, 10 April 2014

a

A

Financial contagion – the situation in which liquidity or insolvency risk is transmitted from one financial institution to another – is viewed by policymakers and academics as a key source of systemic risk in the banking sector.

Topics: Financial markets
Tags: bank runs, banking, banks, contagion, experimental economics, financial crisis, financial stability, global crisis, systemic risk

The puzzling pervasiveness of dysfunctional banking

Charles W Calomiris interviewed by Romesh Vaitilingam, 21 Mar 2014

Charles Calomiris talks to Romesh Vaitilingam about his recent book, co-authored with Stephen Haber, ‘Fragile by Design: The Political Origins of Banking Crises and Scarce Credit’. They discuss how politics inevitably intrudes into bank regulation and why banking systems are unstable in some countries but not in others. Calomiris also presents his analysis of the political and banking history of the UK and how the well-being of banking systems depends on complex bargains and coalitions between politicians, bankers and other stakeholders. The interview was recorded in London in February 2014.

Listen

Unfortunately the file could not be found.

Open in a pop-up window Open in a pop-up window

Download

Download MP3 File (21.3MB)

a

A

See Also

Calomiris, C W and S H Haber (2014), Fragile by Design: The Political Origins of Banking Crises and Scarce Credit, Princeton University Press.

Transcript

View Transcript

Topics: Financial markets
Tags: bank capital, Bank credit, banking, banks, credit booms, Eurozone crisis, recapitalisation, systemic risk

How much is enough? The case of the Resolution Fund in Europe

Thomas Huertas, María J Nieto, 18 March 2014

a

A

During the crisis, individual institutions such as Hypo Real Estate required public assistance of €100 billion or more.1 So how can a European Resolution Fund of only €55 billion possibly suffice for all banks in the Eurozone?

Topics: EU institutions, Financial markets, International finance
Tags: bail-in, bank resolution, banking, European Resolution Fund, eurozone, Macroprudential policy, microprudential regulation, regulation, systemic risk

The AQR and stress testing the European banking system

Viral Acharya interviewed by Viv Davies, 14 Mar 2014

Viral Acharya talks to Viv Davies about his recent work with Sascha Steffen that, using publicly available data and a series of shortfall measures, estimates the capital shortfalls of EZ banks that will be stress-tested under the proposed Asset Quality Review. They also discuss the difference in accounting rules between US and EZ banks and the future potential for banking union in the Eurozone. The interview was recorded by phone on 25 February 2014.

Listen

Unfortunately the file could not be found.

Open in a pop-up window Open in a pop-up window

Download

Download MP3 File (18.4MB)

a

A

See Also

Acharya, V and S Steffen (2014) "Falling short of expectations? Stress-testing the European banking system", VoxEU.org, 17 January.

Transcript

View Transcript

Topics: Financial markets
Tags: Asset Quality Review, bank capital, banking, banking union, banks, Eurozone crisis, recapitalisation, stress testing, systemic risk

Falling short of expectations? Stress-testing the European banking system

Viral Acharya, Sascha Steffen, 17 January 2014

a

A

The Eurozone is mired in a recession. In 2013, the GDP of the 17 Eurozone countries fell by an average of 0.5%, and the outlook for 2014 shows considerable risks across the region. To stabilise the common currency area and its (partly insolvent) financial system, a Eurozone banking union is being established.

Topics: Financial markets
Tags: Asset Quality Review, bank capital, banking, banking union, banks, Eurozone crisis, recapitalisation, stress testing, systemic risk

Foreign-currency loans and systemic risk in Europe

Pınar Yeşin, 26 November 2013

a

A

Before the onset of the financial crisis, foreign currency loans to the non-banking sector in Europe became remarkably prevalent.

Topics: International finance
Tags: foreign currency loans, international finance, systemic risk

Foreign-currency returns and systemic risks

Victoria Galsband, Thomas Nitschka, 10 March 2013

a

A

Patterns in foreign-currency returns

Topics: International finance
Tags: foreign currency, Forex, systemic risk, uncovered interest-rate parity

Vox eBooks