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Author : Paul S. Calem
Publisher :
ISBN 13 :
Total Pages : 66 pages
Book Rating : 4.3/5 ( download)
Download or read book The Impact of Capital-based Regulation on Bank Risk-taking written by Paul S. Calem and published by . This book was released on 1996 with total page 66 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Stéphanie M. Stolz
Publisher : Springer Science & Business Media
ISBN 13 : 3540485449
Total Pages : 163 pages
Book Rating : 4.5/5 (44 download)
Download or read book Bank Capital and Risk-Taking written by Stéphanie M. Stolz and published by Springer Science & Business Media. This book was released on 2007-06-21 with total page 163 pages. Available in PDF, EPUB and Kindle. Book excerpt: The year-long consultations on Basel II mirror the international popularity of capital requirements as a regulatory instrument. Yet, the impact of capital re quirements on banks' behavior is not fully understood. The aim of this study is to contribute to this understanding by answering the following questions: How do banks adjust capital and risk after an increase in capital requirements? How do banks adjust their regulatory capital buffer over the business cycle? And what is the impact of banks' charter value on the regulatory capital buffer? The research undertaken for this study has benefited from support in terms of ideas, research facilities, and, not least, financial funding. My thanks go first of all to Claudia M. Buch for her constant encouragement, her continuous guidance, and her confidence in my research ideas. My thanks go also to the Kiel Institute for World Economics and its staff for providing a very fertile academic ground for my research and for providing excellent research facilities. In fact, conduct ing this study would not have been possible without the support of my colleagues at the Kiel Institute and elsewhere. In particular, I am grateful to Horst Siebert for providing me the freedom to pursue this topic. My special thanks go to Jorg Breitung, Kai Carstensen, and Dieter Urban for providing input on econometric issues. I am also grateful to Andrea Schertler for the long and productive discus sions I had on various parts of this study.
Author :
Publisher : Lulu.com
ISBN 13 : 9291316695
Total Pages : 294 pages
Book Rating : 4.2/5 (913 download)
Download or read book International Convergence of Capital Measurement and Capital Standards written by and published by Lulu.com. This book was released on 2004 with total page 294 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Stéphanie Stolz
Publisher :
ISBN 13 :
Total Pages : 44 pages
Book Rating : 4.:/5 (318 download)
Download or read book The Relationship Between Bank Capital, Risk-taking, and Capital Regulation written by Stéphanie Stolz and published by . This book was released on 2002 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Michael Wedow
Publisher :
ISBN 13 : 9783832512262
Total Pages : 0 pages
Book Rating : 4.5/5 (122 download)
Download or read book Bank Capital Regulation and Risk Taking written by Michael Wedow and published by . This book was released on 2006 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Banking is one of the most regulated industries. The arguments for an extensive regulation of the banking industry are rooted in the importance of banks in financing economic development and the economic costs associated with financial instability in the banking system. In order to design an adequate regulatory framework that ensures financial stability it is decisive to understand the impact of regulation on banks' risk taking. As a starting point, I review the literature on the various instruments of bank regulation with a particular focus on capital regulation. In chapter 3, I provide the reader with a description of the banking system and the regulatory framework in Germany. Chapter 4 examines the role of banks' capitalization for their lending supply. I find that weak capitalization of banks did not slow down lending supply. In chapter 5, I analyze the impact of minimum capital requirements under Basel 2 on bank lending to emerging markets. The results confirm that bank lending will not be subject to dramatic shifts due to a reform in capital regulation.
Author : Paul H. Kupiec
Publisher : International Monetary Fund
ISBN 13 :
Total Pages : 38 pages
Book Rating : 4.:/5 (318 download)
Download or read book Internal Models-Based Capital Regulation and Bank Risk-Taking Incentives written by Paul H. Kupiec and published by International Monetary Fund. This book was released on 2002-07 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: Advocates for internal model-based capital regulation argue that this approach will reduce costs and remove distortions that are created by rules-based capital regulations. These claims are examined using a Merton-style model of deposit insurance. Analysis shows that internal model-based capital estimates are biased by safety-net-generated funding subsidies that convey to bank shareholders when market and credit risk regulatory capital requirements are set using bank internal model estimates. These subsidies are not uniform across the risk spectrum, and, as a consequence, internal model regulatory capital requirements will cause distortions in bank lending behavior.
Author : Lawrence D. Cluff
Publisher : DIANE Publishing
ISBN 13 : 0788186701
Total Pages : 187 pages
Book Rating : 4.7/5 (881 download)
Download or read book Risk-Based Capital written by Lawrence D. Cluff and published by DIANE Publishing. This book was released on 2000 with total page 187 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Mr.Giovanni Dell'Ariccia
Publisher : International Monetary Fund
ISBN 13 : 1484381130
Total Pages : 41 pages
Book Rating : 4.4/5 (843 download)
Download or read book Bank Leverage and Monetary Policy's Risk-Taking Channel written by Mr.Giovanni Dell'Ariccia and published by International Monetary Fund. This book was released on 2013-06-06 with total page 41 pages. Available in PDF, EPUB and Kindle. Book excerpt: We present evidence of a risk-taking channel of monetary policy for the U.S. banking system. We use confidential data on the internal ratings of U.S. banks on loans to businesses over the period 1997 to 2011 from the Federal Reserve’s survey of terms of business lending. We find that ex-ante risk taking by banks (as measured by the risk rating of the bank’s loan portfolio) is negatively associated with increases in short-term policy interest rates. This relationship is less pronounced for banks with relatively low capital or during periods when banks’ capital erodes, such as episodes of financial and economic distress. These results contribute to the ongoing debate on the role of monetary policy in financial stability and suggest that monetary policy has a bearing on the riskiness of banks and financial stability more generally.
Author : Alistair Milne
Publisher :
ISBN 13 :
Total Pages : 52 pages
Book Rating : 4.:/5 (129 download)
Download or read book Bank Capital Regulation and Incentives for Risk-Taking written by Alistair Milne and published by . This book was released on 2019 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: We analyse the incentive impact of bank capital regulation in a model with endogenous capital, assuming regulators randomly audit banks and require undercapitalised banks either to bear the fixed cost of new issue or to liquidate. Forward looking banks with sufficient franchise value maintain a buffer of capital in excess of the regulatory minimum. In our dynamic setting we show, amongst other results: that incentives for risk taking depend upon this buffer of free capital, not the total level; and that the regulatory capital requirement has no long run effect on bank risk-taking.
Author : Robert L. Hetzel
Publisher : DIANE Publishing
ISBN 13 : 1437919529
Total Pages : 40 pages
Book Rating : 4.4/5 (379 download)
Download or read book Should Increased Regulation of Bank Risk-Taking Come from Regulators Or from the Market? written by Robert L. Hetzel and published by DIANE Publishing. This book was released on 2010 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: The heavy losses in bank asset portfolios do not reflect an inherent failure of markets to monitor risk adequately but rather the perverse incentives of the financial safety net to excessive risk-taking. The unsustainable rise in house prices and their subsequent sharp decline derived from the combination of a public policy to expand home ownership to unrealistic levels and from a financial safety net that encouraged excessive risk-taking by banks. Charts and tables.
Author : Deborah Cohen
Publisher :
ISBN 13 :
Total Pages : 72 pages
Book Rating : 4.3/5 (512 download)
Download or read book The Federal Home Loan Bank System written by Deborah Cohen and published by . This book was released on 1980 with total page 72 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Ouarda Merrouche
Publisher : International Monetary Fund
ISBN 13 : 1455254878
Total Pages : 38 pages
Book Rating : 4.4/5 (552 download)
Download or read book Bank Capital written by Ouarda Merrouche and published by International Monetary Fund. This book was released on 2010-12-01 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: Using a multi-country panel of banks, we study whether better capitalized banks experienced higher stock returns during the financial crisis. We differentiate among various types of capital ratios: the Basel risk-adjusted ratio; the leverage ratio; the Tier I and Tier II ratios; and the tangible equity ratio. We find several results: (i) before the crisis, differences in capital did not have much impact on stock returns; (ii) during the crisis, a stronger capital position was associated with better stock market performance, most markedly for larger banks; (iii) the relationship between stock returns and capital is stronger when capital is measured by the leverage ratio rather than the risk-adjusted capital ratio; (iv) higher quality forms of capital, such as Tier 1 capital and tangible common equity, were more relevant.
Author : Alexandra Girod
Publisher :
ISBN 13 :
Total Pages : 310 pages
Book Rating : 4.:/5 (81 download)
Download or read book Bank Risk Taking and Prudential Regulation written by Alexandra Girod and published by . This book was released on 2011 with total page 310 pages. Available in PDF, EPUB and Kindle. Book excerpt: I aim at studying internal mechanisms the Basel regulation induces on bank's risk taking, particularly impacts of risk sensitive requirements. Actually regulation consists in a capital to asset ratio but also in a regulatory framework structuring its functioning. In a first part I concentrate on the structure. Interactions from risk sensitivity, technicality and delegation to banks of inputs' assessment raise two new challenges. First the high technicality of the current framework, with missing guidance for its implementation, can mislead bank's decision. Second delegated-control and risk sensitivity create a dilemma for banks that encourage them to understate their risk level. Moreover, risk sensitive requirements do not impact the rationale to entail regulatory arbitrages via securitisation process. In a second part I focus on risk sensitive requirements. I define a framework with higher risk / higher returns assets where a risk taking behaviour consists in a choice of a riskier asset. The analysis concludes the risk sensitivity does not prevent from the emergence of risk taking behaviour. The IRB risk weight function displays marginal and cyclical variations that impact bank's optimal risk level. My main result is a pro-cyclical effect in terms of asset's risk level: as the business cycle improves, the bank can exploit the freeing of regulatory capital (regulatory bonus) to foster its value towards the financing of a riskier asset; reverse happens for recession where the regulatory penalty restricts bank's optimal asset's risk level. This pro-cyclical effect is due to the cyclical dependence of risk sensitive requirements.
Author : Sonya Williams-Stanton
Publisher :
ISBN 13 :
Total Pages : 37 pages
Book Rating : 4.:/5 (389 download)
Download or read book The Effects of Risk-based Capital on Wealth and Risk-taking in Banking written by Sonya Williams-Stanton and published by . This book was released on 1997 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Frederik Lundtofte
Publisher :
ISBN 13 :
Total Pages : 44 pages
Book Rating : 4.:/5 (13 download)
Download or read book The Effect of Stricter Capital Regulation on Banks' Risk-Taking written by Frederik Lundtofte and published by . This book was released on 2018 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt: A simple portfolio choice model shows that, when a bank's capital is constrained by regulation, regulatory cost (risk weightings) alters the risk and value calculations for the bank's assets. In particular, we find that banks may respond to stricter regulation by increasing the share of high-risk assets. Our empirical results show that U.S. banks responded to the implementation of the stricter Basel II regulations by increasing the share of high-risk assets in the risky part of their portfolios.
Author : Alistair Milne
Publisher :
ISBN 13 :
Total Pages : 52 pages
Book Rating : 4.:/5 (129 download)
Download or read book Bank Capital and Incentives for Risk-Taking written by Alistair Milne and published by . This book was released on 2019 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: We analyse the incentive impact of bank capital regulation in a model with endogenous capital, assuming regulators randomly audit banks and require undercapitalised banks either to bear the fixed cost of new issue or to liquidate. Forward looking banks with sufficient franchise value maintain a buffer of capital in excess of the regulatory minimum. In our dynamic setting we show, amongst other results: that incentives for risk taking depend upon this buffer of free capital, not the total level; and that the regulatory capital requirement has no long run effect on bank risk-taking.
Author : Nesrine Ayadi
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (13 download)
Download or read book The Role of Capital Regulation on Bank Performance written by Nesrine Ayadi and published by . This book was released on 2014 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper we analyze the impact of capital regulation on performance and the risk-taking of thirty European banks. We used a technique of panel data over the period 2004 to 2009. Results show that capital regulation measured by the ratio capital has a negative and statistically significant risk-taking impact. In addition, regulatory pressure is negatively related to financial performance and positively to bank risk taking. As a result, a negative and statistically significant relationship was confirmed between credit risk and the return on assets. The results of this study show that both mechanisms "minimum capital requirements" and "regulatory pressure" are alternative mechanisms. These mechanisms play a major role in the banks' governance and are the key factors of their performance. Hence, equity strengthening would help solve many of the identified problems and therefore strengthen the stability of the financial system without adversely affecting the banking functioning, their value, their performance or even their shareholders.
