Under which conditions do usability constraints for regulatory capital buffers emerge? To answer this question, we build a non-linear structural banking sector model with a minimum capital requirement that banks are not allowed to breach, and a capital buffer requirement (CBR) that banks can...

Wie lassen sich Infrastrukturprojekte finanzieren, ohne Haushalte und Unternehmen zu überlasten? Während viele Ökonomen und Berater für die Mobilisierung von privatem Kapital plädieren, schlagen Patrick Kaczmarczyk und Tom Krebs ein Modell öffentlicher Beteiligungsgesellschaften vor, das...

This working paper assesses the economic impact of EIF-supported equity investments in the Lower Mid-Market (LMM) segment across Europe between 2007 and 2023. Using advanced causal inference techniques, the study compares over 1,700 investee firms with a matched control group to isolate the...

We examine the evolution of equity capital in the U.S. banking industry over the past 35 years. Earnings are the major driver of increases in equity capital in the banking industry. While common stock issuance is frequent, amounts issued are generally small and do not contribute meaningfully to...

This working paper assesses the economic impact of EIF-supported equity investments in the Lower Mid-Market (LMM) segment across Europe between 2007 and 2023. Using advanced causal inference techniques, the study compares over 1,700 investee firms with a matched control group to isolate the...

We investigate the effect of female directors on the firm cost of equity capital.We employ several analytical techniques, including univariate analysis, Ordinary Least Square regressions, and propensity score matching methodology. Our sample consists of US public firms from 2004-2018.We find...

This study investigates whether, and to what extent, dividend-paying firms follow pecking order behavior when altering their capital structure. Using a panel of 3173 U.S. firms from 1960 to 2020 (49,424 firm-year observations), we examine four financing activities: equity and debt issuance under...

This paper attempts to develop a framework for implementing the Countercyclical Capital Buffer (CCyB) in Mongolia's banking sector by identifying early warning indicators of systemic risk and examining the impact of capital adequacy on bank lending. Using quarterly data from 2000 to 2024, the...

Conventional measures of bank solvency fail to account for the unique liquidity risks posed by deposits. Using public regulatory data, we develop a novel measure, economic capital, that jointly quantifies the impact of credit, liquidity, and market risk on bank solvency. We validate that...

This study advances the understanding of cleantech commercialisation by adopting a market validation approach to analyse equity capital’s role in navigating the ‘Valley of Death’. Focusing on the three core financial milestones – revenue generation, profitability and retained earnings...

To what extent can private firms' external equity substitute for debt financing in a banking crisis? To answer this question, I use firm-level data and firm-bank linkages to estimate the causal effect of an imported lending cut from a large German bank on firms' capital structure and real...

We use confidential loan-level data from the European Central Bank to investigate how changes in the countercyclical capital buffer requirement in Germany affect lending to firms. We find evidence showing that tightening the countercyclical capital buffer leads German banks to reduce the volume...

Purpose - This study examines the relationship between board gender diversity and the cost of equity among publicly traded Brazilian companies. Design/methodology/approach - The sample includes Brazilian firms listed on B3 from 2010 to 2023. This study estimated linear and nonlinear regression...

This paper proposes a novel yet intuitive method for the calibration of the CCyB through the cycle in the euro area, including the positive neutral CCyB rate. The paper implements the Risk-to-Buffer framework by Couaillier and Scalone (2024) in both a DSGE and macro time series setting and...

This paper presents the first causal evidence on how banks adjust their voluntary capital buffers (the capital headroom above the required level) in response to changes in capital requirements. Using granular euro area data and exploiting the threshold-based assignment of Other Systemically...

This paper examines the relationship between capital requirements, capital ratios and bank competitiveness - measured as profit efficiency. Using data envelopment analysis techniques, profit efficiency scores were estimated for a sample of listed significant institutions directly supervised by...

This study aimed to examine the impact of the cost of equity on the sensitivity of investment to cash flows by utilizing cross-sectional time series data (Panel Data). The sample consisted of 25 industrial companies listed on the Amman Stock Exchange (ASE) from 2010 to 2020, encompassing a total...

Wie lassen sich Infrastrukturprojekte finanzieren, ohne Haushalte und Unternehmen zu überlasten? Während viele Ökonomen und Berater für die Mobilisierung von privatem Kapital plädieren, schlagen Patrick Kaczmarczyk und Tom Krebs ein Modell öffentlicher Beteiligungsgesellschaften vor, das...

Growing experience since the global financial crisis suggests that there is benefit to both advanced and emerging economies from having releasable capital buffers. Building such buffers in normal times enables policymakers to support lending in the face of shocks irrespective of whether stress...

This paper finds that an additional percentage point in the ratio of Common Equity Tier 1 (CET1) capital to risk-weighted assets is associated with an increase in the Weighted Average Cost of Capital (WACC) of Chilean banks by a maximum of only 11.7 basis points. This result is found by...

In einer panel-ökonometrischen Studie von 6 international operierenden Banken über 37 Quartale untersuchen wir vier verschiedene Digitalisierungsmaßnahmen hinsichtlich ihres Effekts auf den Return on Equity. Ein Fixed-Effects-Modell mit einem R² von 36% zeigt auf, dass der RoE bei Vorliegen...

The aim of this study is to assess the potential to introduce a positive neutral rate for the countercyclical capital buffer (nCCyB) at 0.5%, 1%, 1.5% and 2% in 20 EU countries over the period 2014Q4 up to 2023Q3. Prudential data at country-level was used to estimate the level of banks'...

Purpose - This research investigates the effect of audit report lag on the cost of equity capital. We argue that an extended audit report lag reduces the value of information and raises concerns for investors, resulting in an increased cost of equity capital. Design/methodology/approach - We...

Using granular data from the European corporate credit register, we examine how increases in macroprudential capital buffer requirements since the pandemic have affected bank lending behaviour in the euro area. Our findings reveal that, for the average bank, the buffer requirement increases did...

There are concerns that while stringent capital policy may enhance banks' resilience, it may also have other unintended economic repercussions. This study contributes to this debate by investigating whether regulatory bank capital induces a trade-off between bank stability and economic growth...

This research investigates how investor base affects the cost of equity capital (COE) in Indian companies, particularly in market conditions with weak investor protection and increased ownership concentration by promoters and families. Using ordinary least squares (OLS), panel fixed effects, and...