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Fair value reclassifications of financial assets during the financial crisis

Bischof, Jannis; Brüggemann, Ulf; Daske, Holger - 2012

abandoning fair value recognition for selected financial assets. Using a comprehensive global sample of publicly listed IFRS … reclassifying banks do not fully comply with the accompanying IFRS 7 requirements. These banks experience a significant increase in … bid-ask spreads in the long run. -- Bank Regulation ; Fair Value Accounting ; Financial Crisis ; IAS 39 ; IFRS 7 …

Persistent link: https://www.econbiz.de/10009487337

The IFRS Option to Reclassify Financial Assets out of Fair Value in 2008 : The Roles Played by Regulatory Capital and Too-Important-To-Fail Status

Fiechter, Peter - 2019

Amendment of IAS 39 by the IASB in 2008 provided an option to reclassify investments from fair value to historical cost. Whereas this option was available to all firms, it was particularly relevant to banks. We predict that “too important to fail” (TITF) banks took less advantage of this...

Persistent link: https://www.econbiz.de/10012901923

Fair Value Accounting and Financial Contagion : An Analysis of Marking Up

Tang, Chao - 2019

This paper examines how fair value accounting can create financial contagion among banks and therefore increase bank regulators' costs of protecting insured depositors. Prior research mainly focuses on the economic consequences of marking down, whereas I contribute to the literature by providing...

Persistent link: https://www.econbiz.de/10012890042

Fair Value Accounting, Transparency, and Financial Stability

Mahieux, Lucas - 2019

Prudential regulation of financial institutions relies on asset values measured based on accounting standards. This paper examines how this regulation affects financial institutions' incentives to use Level 2 versus Level 3 fair value reporting and how their endogenous choice affects systemic...

Persistent link: https://www.econbiz.de/10012902423

The Role of Fair Value Accounting in the Global Financial Crisis : Evidence from U.S. Global Systemically Important Banks

Song, Guoxiang - 2014

Fair value accounting has been argued as one contributing factor to the recent global financial crisis occurred from 2007 to 2008. However, recent empirical studies find no significant evidence for this role of fair value accounting. One reason for this inconsistency comes from the weaknesses of...

Persistent link: https://www.econbiz.de/10013063697

Usefulness of Fair Values for Predicting Banks’ Future Earnings : Evidence from Other Comprehensive Income and Its Components

Bratten, Brian - 2016

This paper examines whether fair value adjustments included in other comprehensive income (OCI) can predict future performance in banks. We also examine whether the reliability of these fair value estimates affects their predictive value. Using a sample of bank holding companies, we find that...

Persistent link: https://www.econbiz.de/10013007857

Are Fair Value Options Created Equal? A Study of SFAS 159 and Earnings Volatility

Couch, Robert B. - 2014

The fair value option (FVO) embedded in both SFAS 159 and IAS 39 was introduced to allow firms to reduce earnings volatility induced from mixed-measurement accounting. Fiechter (2011) finds a reduction in earnings volatility among IAS 39 FVO adopters. In contrast, we find that earnings...

Persistent link: https://www.econbiz.de/10013059635

Evaluating the Impact of Fair Value Accounting on Financial Institutions : Implications for Accounting Standards Setting and Bank Supervision

Shaffer, Sanders - 2012

Recent standard-setting activity related to fair value accounting has injected new life into questions of whether fair value provides information useful for decision-making, and whether there might be unintended consequences on financial stability. This discussion paper provides insight into...

Persistent link: https://www.econbiz.de/10013110584

Fair Value Accounting for Financial Instruments : Some Implications for Bank Regulation

Landsman, Wayne R. - 2013

I identify issues that bank regulators need to consider if fair value accounting is used for determining bank regulatory capital and when making regulatory decisions. In financial reporting, US and international accounting standard setters have issued several disclosure and measurement and...

Persistent link: https://www.econbiz.de/10014026538

Accounting for financial instruments in the banking industry : conclusions from a simulation model

Gebhardt, Günther; Reichardt, Rolf; Wittenbrink, Carsten - 2003 - Revised: November 2003

The paper analyses the effects of three sets of accounting rules for financial instruments - Old IAS before IAS 39 became effective, Current IAS or US GAAP, and the Full Fair Value (FFV) model proposed by the Joint Working Group (JWG) - on the financial statements of banks. We develop a...

Persistent link: https://www.econbiz.de/10009765358