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High Liquidity Creation and Bank Failures

2015-05-06 Business & Economics
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Release : 2015-05-06
Genre : Business & Economics
Kind : eBook
Book Rating : 807/5 ( reviews)

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Book Synopsis High Liquidity Creation and Bank Failures by : Zuzana Fungacova

Download or read book High Liquidity Creation and Bank Failures written by Zuzana Fungacova. This book was released on 2015-05-06. Available in PDF, EPUB and Kindle. Book excerpt: We formulate the “High Liquidity Creation Hypothesis” (HLCH) that a proliferation in the core activity of bank liquidity creation increases failure probability. We test the HLCH in the context of Russian banking, which provides a natural field experiment due to numerous failures experienced over the past decade. Using Berger and Bouwman’s (2009) liquidity creation measures as a comprehensive proxy for overall bank output, we find that high liquidity creation significantly increases the probability of bank failure; this finding survives multiple robustness checks. Our results suggest that regulatory authorities can mitigate systemic distress and reduce the costs of bank failures to society through early identification of high liquidity creators and enhanced monitoring of their funding and investment activities.

High Liquidity Creation and Bank Failures

2015-05-06 Business & Economics
Download High Liquidity Creation and Bank Failures PDF Online Free

Author :
Release : 2015-05-06
Genre : Business & Economics
Kind : eBook
Book Rating : 100/5 ( reviews)

GET EBOOK


Book Synopsis High Liquidity Creation and Bank Failures by : Zuzana Fungacova

Download or read book High Liquidity Creation and Bank Failures written by Zuzana Fungacova. This book was released on 2015-05-06. Available in PDF, EPUB and Kindle. Book excerpt: We formulate the “High Liquidity Creation Hypothesis” (HLCH) that a proliferation in the core activity of bank liquidity creation increases failure probability. We test the HLCH in the context of Russian banking, which provides a natural field experiment due to numerous failures experienced over the past decade. Using Berger and Bouwman’s (2009) liquidity creation measures as a comprehensive proxy for overall bank output, we find that high liquidity creation significantly increases the probability of bank failure; this finding survives multiple robustness checks. Our results suggest that regulatory authorities can mitigate systemic distress and reduce the costs of bank failures to society through early identification of high liquidity creators and enhanced monitoring of their funding and investment activities.

Bank Liquidity Creation and Financial Crises

2015-11-24 Business & Economics
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Author :
Release : 2015-11-24
Genre : Business & Economics
Kind : eBook
Book Rating : 319/5 ( reviews)

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Book Synopsis Bank Liquidity Creation and Financial Crises by : Allen N. Berger

Download or read book Bank Liquidity Creation and Financial Crises written by Allen N. Berger. This book was released on 2015-11-24. Available in PDF, EPUB and Kindle. Book excerpt: Bank Liquidity Creation and Financial Crises delivers a consistent, logical presentation of bank liquidity creation and addresses questions of research and policy interest that can be easily understood by readers with no advanced or specialized industry knowledge. Authors Allen Berger and Christa Bouwman examine ways to measure bank liquidity creation, how much liquidity banks create in different countries, the effects of monetary policy (including interest rate policy, lender of last resort, and quantitative easing), the effects of capital, the effects of regulatory interventions, the effects of bailouts, and much more. They also analyze bank liquidity creation in the US over the past three decades during both normal times and financial crises. Narrowing the gap between the "academic world" (focused on theories) and the "practitioner world" (dedicated to solving real-world problems), this book is a helpful new tool for evaluating a bank's performance over time and comparing it to its peer group. - Explains that bank liquidity creation is a more comprehensive measure of a bank's output than traditional measures and can also be used to measure bank liquidity - Describes how high levels of bank liquidity creation may cause or predict future financial crises - Addresses questions of research and policy interest related to bank liquidity creation around the world and provides links to websites with data and other materials to address these questions - Includes such hot-button topics as the effects of monetary policy (including interest rate policy, lender of last resort, and quantitative easing), the effects of capital, the effects of regulatory interventions, and the effects of bailouts

Does Excessive Liquidity Creation Trigger Bank Failures?

2013
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Release : 2013
Genre :
Kind : eBook
Book Rating : 641/5 ( reviews)

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Book Synopsis Does Excessive Liquidity Creation Trigger Bank Failures? by : Zuzana Fungác̆ová

Download or read book Does Excessive Liquidity Creation Trigger Bank Failures? written by Zuzana Fungác̆ová. This book was released on 2013. Available in PDF, EPUB and Kindle. Book excerpt:

Does Excessive Liquidity Creation Trigger Bank Failures?

2016
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Author :
Release : 2016
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Kind : eBook
Book Rating : /5 ( reviews)

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Book Synopsis Does Excessive Liquidity Creation Trigger Bank Failures? by : Zuzana Fungáčová

Download or read book Does Excessive Liquidity Creation Trigger Bank Failures? written by Zuzana Fungáčová. This book was released on 2016. Available in PDF, EPUB and Kindle. Book excerpt: This paper introduces the "Excessive Liquidity Creation Hypothesis," whereby a rise in a bank's core liquidity creation activity increases its probability of failure. Russia experienced many bank failures over the past decade, making it an ideal natural field experiment for testing this hypothesis. Using Berger and Bouwman's (2009) liquidity creation measures, we find that excessive liquidity creation significantly increased the probability of bank failure during our observation period (2000?2007). This finding survives multiple robustness checks. Our results further suggest that regulatory authorities can mitigate systemic distress and reduce the costs to society from bank failures through early identification and enhanced monitoring of excessive liquidity creators.

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