Up to a point, banks and markets both foster economic growth. Beyond that limit, expanded bank lending or market-based financing no longer adds to real growth. But when it comes to moderating business cycle fluctuations, banks and markets differ considerably in their effects. In normal...

Bank capital ratios have increased steadily since the financial crisis. For a sample of 94 large banks from advanced and emerging economies, retained earnings account for the bulk of their higher risk-weighted capital ratios, with reductions in risk weights playing a lesser role. On average,...

Despite their importance in macroeconomic and financial stability analysis, residential property data are not easily available on a comparable basis. The BIS currently publishes more than 300 price series for 55 countries, among which it has selected one representative series for each country....

This paper presents an analysis on how the expected development of pension funds in Italy will contribute toenhance corporate governance. The existing evidence on this issue comes mainly from the Anglo Saxon countries but it does notshow unequivocal effectiveness of activism on firm performance....

Sovereign spreads can be broken up into two components=the expected loss from default and the risk premium, with the latter reflecting how investors price the risk of unexpected losses. We show that the risk premium is often the larger part of the spread.

Securitisation can transform ordinarily illiquid or risky assets into more liquid or less risky ones. Despite the recent rapid growth of securitisation, the Latin American market remains in its infancy, as reflected in the size and type of assets involved in transactions. Because of its...

We propose a new approach to measuring sovereign default risk. We use sovereign credit ratings and historical default rates provided by credit rating agencies to construct a measure of ratings-implied expected loss. We compare our measure of expected loss from sovereign defaults with stand-alone...