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Author : Jun Zhu
Publisher :
ISBN 13 :
Total Pages : 121 pages
Book Rating : 4.:/5 (785 download)
Download or read book Three Essays in Financial Intermediation and Securitization written by Jun Zhu and published by . This book was released on 2011 with total page 121 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Didier Cossin
Publisher :
ISBN 13 :
Total Pages : 412 pages
Book Rating : 4.:/5 (296 download)
Download or read book Three Essays on Financial Intermediation written by Didier Cossin and published by . This book was released on 1993 with total page 412 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Johanna Krenz
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (115 download)
Download or read book Three Essays on Financial Intermediation in the Open Economy written by Johanna Krenz and published by . This book was released on 2018 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Alexander Galetovic P.
Publisher :
ISBN 13 :
Total Pages : 202 pages
Book Rating : 4.:/5 (31 download)
Download or read book Three Essays on Financial Intermediation and Long-run Growth written by Alexander Galetovic P. and published by . This book was released on 1994 with total page 202 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Roberto Liebscher
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (111 download)
Download or read book Three Essays on Financial Intermediation written by Roberto Liebscher and published by . This book was released on 2017 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Stefan Pohl
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (14 download)
Download or read book Three Essays on Empirical Financial Intermediation written by Stefan Pohl and published by . This book was released on 2023 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:
![Download Three Essays on Financial Intermediation [cumulative Dissertation] PDF Online Free](https://books.google.com/books/content/images/frontcover/vNR1zwEACAAJ?fife=w200-h370)
Author : Roberto Liebscher
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (119 download)
Download or read book Three Essays on Financial Intermediation [cumulative Dissertation] written by Roberto Liebscher and published by . This book was released on 2019 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Adi Mordel
Publisher :
ISBN 13 :
Total Pages : 262 pages
Book Rating : 4.:/5 (643 download)
Download or read book Three Essays on Securitization written by Adi Mordel and published by . This book was released on 2010 with total page 262 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Ranajoy Ray Chaudhuri
Publisher :
ISBN 13 :
Total Pages : 117 pages
Book Rating : 4.:/5 (812 download)
Download or read book Three Essays on Financial Intermediation and Growth written by Ranajoy Ray Chaudhuri and published by . This book was released on 2012 with total page 117 pages. Available in PDF, EPUB and Kindle. Book excerpt: Abstract: My dissertation explores the impact of financial development, as well as regulatory changes in the financial sector, on economic growth. Recent literature on growth has often focused on the importance of financial intermediation and institutional quality. Advocates of financial development say that the development of the banking sector and stock markets increase the financing available to firms, raising productivity. The "institutions hypothesis" proponents suggest that institutions jointly determine the growth rate and the policy choice, while policies themselves bear no causal connection to growth. Such hypothesis is difficult to test empirically because the change in institutional quality is, with a few historic exceptions, very slow. For the most part, therefore, a country's economic performance can end up being attributed to a random cause. Using a cross-country data set and numerous financial indicators, institutional quality variables and growth measures, I find that this is not true of financial development. Financial variables have a significant effect on growth that is distinct from that of institutions like private property and rule of law. I also consider this issue in the context of the fifty U.S. states. States differ with respect to financial indicators like the number of banks, assets, equity, loans and deposits. They also vary in terms of their regulatory environments. States like Delaware, Texas and Nevada have very high scores for economic freedom; Mississippi, New Mexico and West Virginia have very low ones. The results again underscore the importance of financial deepening in order to achieve economic growth. Taking up from this point, the final essay studies the impact of U.S. banking deregulation on growth. Many states relaxed restrictions on intra-state bank branching beginning in the early 1960s, both by allowing bank holding companies to convert subsidiaries into branches and by permitting statewide de novo branching. This increased competition in the banking sector forced banks to become more efficient. The existing literature suggests that one of the channels through which this worked was bank lending. Different industries have varying degrees of dependence on external financing, and industries that have greater dependence should grow faster in the post-deregulation period. Using a panel data set, I find this not to be the case for the U.S.; industries that borrow less from banks actually grew at a faster rate after deregulation. This could reflect commercial banks losing market share to other sources of external financing, the general decline in the U.S. manufacturing sector and the terms of trade moving in favor of agriculture. I also consider the effect of deregulation on various banking indicators and find the strongest impact to be on the number of commercial banks operating in the state. Contrary to existing research, these regulatory changes slowed down growth in the number of bank branches and offices, as well as other measures of bank performance like assets, equity, loans and deposits. This suggests that the gains from deregulation are short-lived, and also indicate unprofitable smaller banks shuttering their operations and the emergence of credit unions and other alternatives to commercial banks.
Author : Yuteng Cheng (Ph.D.)
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (135 download)
Download or read book Essays on Banking and Financial Intermediation written by Yuteng Cheng (Ph.D.) and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Chapter 1 uses a mix of theory and data to study the unintended consequences of mandatory retention rules in securitization. The Dodd-Frank Act and the EU Securitization Regulation both impose a 5% mandatory retention requirement in securitization to motivate financial intermediaries to screen and monitor their borrowers more carefully. To better understand the impact of the policy, this chapter studies two related research questions. First, can mandatory retention have unintended consequences? Second, is the current level of retention optimal? To answer those questions, I propose a novel trade-off model in which retention strengthens monitoring but may also encourage banks to shift risk. I go on to provide empirical evidence supporting this unintended consequence: in the data, banks shifted toward riskier portfolios after the implementation of the retention rules embedded in Dodd-Frank. Furthermore, the model provides clear testable predictions about policy and corresponding consequences. I show in the data that stricter retention rules caused banks to monitor and shift risk simultaneously. According to the model prediction, such a simultaneous increase can only occur when the retention level is above optimal, which suggests that the current rate of 5% in the US is too high. Chapter 2Chapter 2 studies the source of fragility of OTC-natured interbank markets. Most research on the fragility of interbank markets -in the sense of multiplicity of equilibria driven by adverse selection-relies on a competitive market structure. By contrast, this chapter accounts for the OTC market nature and the market power of some players. Under adverse selection alone, markets are not fragile; that is, the equilibrium is unique. However, when adverse selection is combined with moral hazard on the borrowers' side, multiple equilibria arise again, and the bad equilibrium exhibits troubled banks gambling for resurrection. An interest rate floor eliminates the bad equilibrium. More generally, policies to reduce fragility should address moral hazard rather than adverse selection. Chapter 3Chapter 3 studies the contracting differences between corporate loans that are sold in the secondary market and that are securitized in the CLO market. With secondary loan sales and CLO markets being the two markets for corporate loan commoditization, empirical studies find that banks add additional restrictive covenants to loans sold and looser covenants to loans securitized. Why is it so? This chapter builds a theoretical model to explain such contracting differences in these two markets. The key mechanism is that the bank alleviates the borrowers' moral hazard problem via public monitoring and charges higher interest rates due to the relaxing of incentives provided. Those high interest rates facilitate loan sales because the information problem embedded in loan sales is lessened. In contrast, adverse selection is less severe in securitization since the bank retains the information-sensitive tranche.
Author : Igor Salitskiy
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (881 download)
Download or read book Essays on Financial Intermediation written by Igor Salitskiy and published by . This book was released on 2014 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation consists of three studies. In the first study I This paper extends the costly state verification model from Townsend (1979) to a dynamic and hierarchical setting with an investor, a financial intermediary, and an entrepreneur. Such a hierarchy is natural in a setting where the intermediary has special monitoring skills. This setting yields a theory of seniority and dynamic control: it explains why investors are usually given the highest priority on projects' assets, financial intermediaries have middle priority and entrepreneurs have the lowest priority; it also explains why more cash flow and control rights are allocated to financial intermediaries if a project's performance is bad and to entrepreneurs if it is good. I show that the optimal contracts can be replicated with debt and equity. If the project requires a series of investments until it can be sold to outsiders, the entrepreneur sells preferred stock (a combination of debt and equity) each time additional financing is needed. If the project generates a series of positive payoffs, the entrepreneur sells a combination of short-term and long-term debt. In the second study I I study optimal government interventions during asset fire sales by banks. Fire sales happen when a large portion of banks receive liquidity shocks. This depletes bank balance sheets directly and indirectly because these assets are used as collateral. The government can respond by buying distressed assets or buying stock from banks. Stock purchases do not deprive banks of collateral, but may have a lower effect on asset prices. The optimal policy depends on the elasticity of asset prices to asset supply and the amount of assets held by banks. Calibration to the recent financial crisis is provided. In the third study conducted with Attila Ambrus and Eric Chaney we use ransom prices and time to ransom for over 10,000 captives rescued from two Barbary strongholds to investigate the empirical relevance of dynamic bargaining models with one-sided asymmetric information in ransoming settings. We observe both multiple negotiations that were ex ante similar from the uninformed party's (seller's) point of view, and information that only the buyer knew. Through reduced-form analysis, we test some common qualitative predictions of dynamic bargaining models. We also structurally estimate the model in Cramton (1991) to compare negotiations in different Barbary strongholds. Our estimates suggest that the historical bargaining institutions were remarkably efficient, despite the presence of substantial asymmetric information.
Author : Yuteng Cheng (Ph.D.)
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (136 download)
Download or read book Essays on Banking and Financial Intermediation written by Yuteng Cheng (Ph.D.) and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Chapter 1 uses a mix of theory and data to study the unintended consequences of mandatory retention rules in securitization. The Dodd-Frank Act and the EU Securitization Regulation both impose a 5% mandatory retention requirement in securitization to motivate financial intermediaries to screen and monitor their borrowers more carefully. To better understand the impact of the policy, this chapter studies two related research questions. First, can mandatory retention have unintended consequences? Second, is the current level of retention optimal? To answer those questions, I propose a novel trade-off model in which retention strengthens monitoring but may also encourage banks to shift risk. I go on to provide empirical evidence supporting this unintended consequence: in the data, banks shifted toward riskier portfolios after the implementation of the retention rules embedded in Dodd-Frank. Furthermore, the model provides clear testable predictions about policy and corresponding consequences. I show in the data that stricter retention rules caused banks to monitor and shift risk simultaneously. According to the model prediction, such a simultaneous increase can only occur when the retention level is above optimal, which suggests that the current rate of 5% in the US is too high. Chapter 2Chapter 2 studies the source of fragility of OTC-natured interbank markets. Most research on the fragility of interbank markets -in the sense of multiplicity of equilibria driven by adverse selection-relies on a competitive market structure. By contrast, this chapter accounts for the OTC market nature and the market power of some players. Under adverse selection alone, markets are not fragile; that is, the equilibrium is unique. However, when adverse selection is combined with moral hazard on the borrowers' side, multiple equilibria arise again, and the bad equilibrium exhibits troubled banks gambling for resurrection. An interest rate floor eliminates the bad equilibrium. More generally, policies to reduce fragility should address moral hazard rather than adverse selection. Chapter 3Chapter 3 studies the contracting differences between corporate loans that are sold in the secondary market and that are securitized in the CLO market. With secondary loan sales and CLO markets being the two markets for corporate loan commoditization, empirical studies find that banks add additional restrictive covenants to loans sold and looser covenants to loans securitized. Why is it so? This chapter builds a theoretical model to explain such contracting differences in these two markets. The key mechanism is that the bank alleviates the borrowers' moral hazard problem via public monitoring and charges higher interest rates due to the relaxing of incentives provided. Those high interest rates facilitate loan sales because the information problem embedded in loan sales is lessened. In contrast, adverse selection is less severe in securitization since the bank retains the information-sensitive tranche.
Author : Luis Arturo Lopez
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (11 download)
Download or read book Essays on Brokers, Financial Intermediaries, and Securitized Mortgages written by Luis Arturo Lopez and published by . This book was released on 2019 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Although the economic literature documents theoretical agency models that align the incentives between the agents and principals, there are countless anecdotes where the theoretical models do not hold in practice. This dissertation examines the behaviors of brokers and intermediaries in various sectors of the real estate market. The first two chapters focus on real estate brokers in the housing market while the latter two focus on financial intermediaries in the securitized mortgage market. The purpose is to draw lessons or policy implications. In Chapter 1, for instance, I find that homes owned by real estate agents sell at a premium of 2.7 percent (or $4,900) above the sale price of clients' homes. Homes of relatives sell at a premium of 1.3 percent (or $2,360). While prior literature attributes the price disparity to the agents' exploitation of information asymmetry about the market, I argue that the disparity likely derives from the contract rigidity in listing agreements. I show that real estate agents enjoy a low cost to breach contracts and can, therefore, enter or exit the market more easily than clients to obtain desirable prices. The policy implication is that reducing the agents' advantage requires increasing the households' power to breach listing agreements but at the trade-off of reducing the willingness of agents to participate in the market.In Chapter 2, using use artificial intelligence, I identify financial steering activity that is fostered by real estate agents representing sellers. Examining data that allows me to observe private information exchanges between listing and buyer agents, I find that over 13 percent of the homes sold had bidding constraints requiring financed buyers to obtain a pre-qualification letter from an affiliated lender even if pre-qualified with another lender. I also find that while steering decreases the transaction costs sellers experience by screening buyers (as agents representing sellers often proclaim), it decreases the equilibrium price of the average home by about 1 percent (or $1,900). Financial steering also displaces financed buyers (especially African Americans and Hispanics) while it favors cash or corporate investors. These findings present a trade-off that policymakers encounter when designing and enforcing anti-steering or pro-competition regulations in financial markets. In Chapter 3, I empirically examine the monitoring role of trustees in the securitization market for commercial mortgages. Using a natural experiment around mergers that result in servicers (i.e., agents) and trustees (i.e., monitors) falling under the same institutional umbrella, I present evidence that affiliation is associated with a decrease in the servicers' effort made on behalf of investors (i.e., principals). I also find that a servicer-trustee affiliation causes distortions to the cash flows to bondholders and a decrease in the average recovery rate of a delinquent commercial mortgage by up to $0.07 per dollar of outstanding debt, accounting for an economic impact of about $4.53 billion in market-wide liquidation losses. The policy implication is that third-party oversight plays an imperative role in aligning incentives.Finally, in Chapter 4, I examine how affiliation to senior bondholders can influence servicing decisions on delinquent loans in non-agency residential mortgage-backed securities. Making use of a natural experiment involving mergers and acquisitions that resulted in servicers owning investors who in turn have ownership of the bonds the servicers manage, I find that affiliation improves the chances that a loan is liquidated through a non-foreclosure avenue by about 33 percent relative to foreclosure. Moreover, analyzing investment-grade bond holdings, I find no evidence of senior investors responding negatively to servicer-investor affiliations in the RMBS market. Overall, these results suggest that exposing servicers to senior bond holdings through an affiliation with their own investors significantly improves the servicers' behavior.
Author : Solomon Y Deku
Publisher : Springer
ISBN 13 : 3319601288
Total Pages : 186 pages
Book Rating : 4.3/5 (196 download)
Download or read book Securitization: Past, Present and Future written by Solomon Y Deku and published by Springer. This book was released on 2017-08-04 with total page 186 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book aims to explore if and how securitization changed financial intermediation and lending behaviour by reviewing the pre- and post-financial crisis theoretical and empirical literature. The book’s distinctive feature is bringing the growing post-crisis empirical evidence to the attention of a wider audience by critically appraising it against pre-crisis arguments. With its thought-provoking insights, this book is of particular interest for students, practitioners and academics.
Author : Marc S. Schaffer
Publisher :
ISBN 13 :
Total Pages : 130 pages
Book Rating : 4.:/5 (828 download)
Download or read book Traditional and Market-based Financial Intermediaries written by Marc S. Schaffer and published by . This book was released on 2012 with total page 130 pages. Available in PDF, EPUB and Kindle. Book excerpt: In the wake of our country's greatest financial crisis since the Great Depression, the need to better understand the risks and behaviors associated with financial intermediaries has become apparent. In particular, the literature distinguishes between traditional or depository based financial intermediaries and their market based or non depository counterparts. This dissertation focuses on understanding the behavioral differences across these two groups by examining their equity based risk differences, their stock market delisting differences, and lastly how these firms react to economic policy uncertainty. The first essay uses an equity based approach to quantify the average firm level risk that is associated with these intermediary groups. While these intermediaries, at times, demonstrate similar risk behaviors, the market based financial intermediaries display a distinct ten year period of greater risk beginning in 1994. Since the 1980s there has been a trend of increasing financial market instability that is commonly attributed to increasing competition, securitization, and deregulation. Using a historical decomposition approach, I analyze which of these factors best explains the changing relative risk behaviors across the traditional and market based intermediaries. The most important factor in driving these behaviors was deregulation, with competition also having a significant impact. The second essay examines the stock market survival behavior of each of these respective groups and the role that risk plays in explaining delisting due to firm failure, as well as merger and acquisition activity. Using survival analysis, the delisting behavior of these intermediaries is examined where the market based firms are more likely to delist relative to the traditional firms due to both firm failure and M and A activity. Additionally, idiosyncratic risk is found to have a statistically significant impact in driving these behaviors. The last essay focuses on how each of these intermediary groups alters their balance sheet in the face of economic uncertainty. Specifically, I examine how the debt financing behavior of these firms reacts to an economic policy uncertainty shock using a macroeconomic approach. The key results, from the impulse response and variance decomposition analysis, indicate that market based financial intermediaries tend to have faster responses to policy uncertainty relative to traditional intermediaries, however the small traditional financial intermediaries have the largest response.
Author : Bert Scholtens
Publisher :
ISBN 13 : 9783902109156
Total Pages : 59 pages
Book Rating : 4.1/5 (91 download)
Download or read book The Theory of Financial Intermediation written by Bert Scholtens and published by . This book was released on 2003 with total page 59 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Steven Drucker
Publisher :
ISBN 13 :
Total Pages : 304 pages
Book Rating : 4.:/5 (255 download)
Download or read book Essays in Financial Intermediation written by Steven Drucker and published by . This book was released on 2005 with total page 304 pages. Available in PDF, EPUB and Kindle. Book excerpt:
