Search Results - subject:"“too big to fail”"

Fallacies, irrelevant facts, and myths in the discussion of capital regulation: Why bank equity is not socially expensive

Admati, Anat R.; DeMarzo, Peter M.; Hellwig, Martin; … - 2013

We examine the pervasive view that 'equity is expensive' which leads to claims that high capital requirements are costly for society and would affect credit markets adversely. We find that arguments made to support this view are fallacious, irrelevant to the policy debate by confusing private...

Persistent link: https://www.econbiz.de/10010334527

Implicit State Guarantees Exacerbate Problem: Separated Banking System Alone Not a Solution

Klaus, Benjamin; Schäfer, Dorothea - In: DIW Economic Bulletin 3 (2013) 6, pp. 3-14

Many banks are now too big, complex, and closely interconnected to be liquidated. When they run into difficulties, they threaten the entire financial system of their economic area. Five years of financial crisis have not alleviated but exacerbated this problem. The cost of stabilizing banks is...

Persistent link: https://www.econbiz.de/10011128079

Implizite Staatsgarantien verschärfen die Probleme - Trennbankensystem allein ist keine Lösung

Klaus, Benjamin; Schäfer, Dorothea - In: DIW Wochenbericht 80 (2013) 18, pp. 3-15

Many banks are now too big, complex, and closely networked to be wound up. When they get into difficulties, they threaten the entire financial system of their economic area. Five years of financial crisis have not alleviated but exacerbated this problem. The cost of stabilizing banks is...

Persistent link: https://www.econbiz.de/10011128786

Connect them where it hurts. The missing piece of the puzzle

Esposito, Lorenzo - Banca d'Italia - 2013

The crisis has shown that banks that are too big to fail are at the core of the international financial system. These …

Persistent link: https://www.econbiz.de/10011105112

"Too big to fail" or "Too non-traditional to fail"?: The determinants of banks' systemic importance

Moore, Kyle; Zhou, Chen - Volkswirtschaftliche Fakultät, … - 2013

to banks' systemic importance. Therefore, in addition to ``Too big to fail", systemically important financial … systemic importance of financial institutions we find that size is a leading determinant. This confirms the usual "Too big to … fail'' argument. Nevertheless, banks with size above a sufficiently high level have equal systemic importance. In addition …

Persistent link: https://www.econbiz.de/10011109648

The News Content of Bank Rating Changes - Evidence from a Global Event Study

Körner, Finn Marten; Fieberg, Christian; Varmaz, Armin; … - ZenTra - Center for Transnational Studies - 2013

from negative rating information even post-Lehman due to an implicit "too big to fail" subsidy anticipated by equity …

Persistent link: https://www.econbiz.de/10010735750

Financial Sector Reform After the Crisis: Has Anything Happened?

Schnabel, Isabel; Weder, Beatrice; Schaefer, Alexander - Volkswirtschaftslehre-Lehrstühle, Gutenberg School of … - 2013

We analyze the reaction of stock returns and CDS spreads of banks from Europe and the United States to four major regulatory reforms in the aftermath of the subprime crisis, employing an event study analysis. In contrast to the public perception that nothing has happened, we find that financial...

Persistent link: https://www.econbiz.de/10010944711

Bank Bailouts and Market Discipline: How Bailout Expectations Changed During the Financial Crisis

Hett, Florian; Schmidt, Alexander - Volkswirtschaftslehre-Lehrstühle, Gutenberg School of … - 2013

We show that market discipline, defined as the extent to which frm specific risk characteristics are reflected in market prices, eroded during the recent financial crisis in 2008. We design a novel test of changes in market discipline based on the relation between firm specific risk...

Persistent link: https://www.econbiz.de/10010944713

Bank rescues and bailout expectations: The erosion of market discipline during the financial crisis

Hett, Florian; Schmidt, Alexander - Research Center SAFE (Sustainable Architecture for … - 2013

We show that market discipline, defined as the extent to which firm specific risk characteristics are re ected in market prices, eroded during the recent financial crisis in 2008. We design a novel test of changes in market discipline based on the relation between firm specific risk...

Persistent link: https://www.econbiz.de/10010955130

The cost of firms' debt financing

Pianeselli, Daniele; Zaghini, Andrea - Center for Financial Studies - 2013

We provide an assessment of the determinants of the risk premia paid by non-financial corporations on long-term bonds. By looking at 5,500 issues over the period 2005-2012, we find that in recent years the sovereign debt market turbulence has been a major driver of corporate risk. Compared with...

Persistent link: https://www.econbiz.de/10010958710