Download or read book The Effects of Regulatory Reform on Competition in the Banking Industry written by Paolo Angelini and published by . This book was released on 2006 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The paper analyzes the evolution of competitive conditions in the Italian banking industry using firm-level balance sheet data for the period 1984-1997. Regulatory reform, large-scale consolidation and competitive pressure from other European countries have changed substantially the banking environment, with potentially offsetting effects on the overall degree of competitiveness. We find that competitive conditions, relatively unchanged until 1992, improved substantially thereafter, as signaled by the decline in estimated mark-ups. Also, we analyze for the first time the long-run impact of the consolidation process on competition, and find no evidence that banks involved in mergers and acquisitions gained market power; at the same time, they exhibit lower than average marginal costs. Finally, after controlling for various factors that may have determined the time pattern of banks' estimated mark-ups, we still detect a significant unexplained drop in our competitive conditions indicators after 1992. Overall, our evidence is consistent with the hypothesis that the deregulation process, culminated with the implementation of the Second Banking Directive in 1993, significantly contributed to improve bank ompetition, and that it may also have been an important determinant of the consolidation process recorded by the Italian credit system during the nineties.
Download or read book Economic Regulation and Its Reform written by Nancy L. Rose and published by University of Chicago Press. This book was released on 2014-08-29 with total page 619 pages. Available in PDF, EPUB and Kindle. Book excerpt: The past thirty years have witnessed a transformation of government economic intervention in broad segments of industry throughout the world. Many industries historically subject to economic price and entry controls have been largely deregulated, including natural gas, trucking, airlines, and commercial banking. However, recent concerns about market power in restructured electricity markets, airline industry instability amid chronic financial stress, and the challenges created by the repeal of the Glass-Steagall Act, which allowed commercial banks to participate in investment banking, have led to calls for renewed market intervention. Economic Regulation and Its Reform collects research by a group of distinguished scholars who explore these and other issues surrounding government economic intervention. Determining the consequences of such intervention requires a careful assessment of the costs and benefits of imperfect regulation. Moreover, government interventions may take a variety of forms, from relatively nonintrusive performance-based regulations to more aggressive antitrust and competition policies and barriers to entry. This volume introduces the key issues surrounding economic regulation, provides an assessment of the economic effects of regulatory reforms over the past three decades, and examines how these insights bear on some of today’s most significant concerns in regulatory policy.
Download or read book Competition and Stability in Banking written by Xavier Vives and published by Princeton University Press. This book was released on 2020-11-03 with total page 344 pages. Available in PDF, EPUB and Kindle. Book excerpt: A distinguished economist examines competition, regulation, and stability in today's global banks Does too much competition in banking hurt society? What policies can best protect and stabilize banking without stifling it? Institutional responses to such questions have evolved over time, from interventionist regulatory control after the Great Depression to the liberalization policies that started in the United States in the 1970s. The global financial crisis of 2007–2009, which originated from an oversupply of credit, once again raised questions about excessive banking competition and what should be done about it. Competition and Stability in Banking addresses the critical relationships between competition, regulation, and stability, and the implications of coordinating banking regulations with competition policies. Xavier Vives argues that while competition is not responsible for fragility in banking, there are trade-offs between competition and stability. Well-designed regulations would alleviate these trade-offs but not eliminate them, and the specificity of competition in banking should be accounted for. Vives argues that regulation and competition policy should be coordinated, with tighter prudential requirements in more competitive situations, but he also shows that supervisory and competition authorities should stand separate from each other, each pursuing its own objective. Vives reviews the theory and empirics of banking competition, drawing on up-to-date analysis that incorporates the characteristics of modern market-based banking, and he looks at regulation, competition policies, and crisis interventions in Europe and the United States, as well as in emerging economies. Focusing on why banking competition policies are necessary, Competition and Stability in Banking examines regulation's impact on the industry's efficiency and effectiveness.
Download or read book Why Regulatory Reform Fails written by Maureen Ann Young and published by . This book was released on 1990 with total page 488 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Regulatory Reform and Competitiveness in Europe Vertical issues written by Giampaolo Galli and published by Edward Elgar Publishing. This book was released on 2000-01-01 with total page 524 pages. Available in PDF, EPUB and Kindle. Book excerpt: The second of two volumes, this text discusses the vertical issues involved in regulatory reform. The contributors describe in detail the regulatory reforms which are needed or have been initiated in nine major industrial sectors, including automobiles, textiles and clothing, retail trade, chemicals, banking, road transport, telecoms, electricity and (scheduled) air transport. They argue that regulatory reform can, more often than not, help improve the competitiveness of companies while generating net growth effects for the European Union as a whole.
Download or read book Economic Effects of Regulatory Policy in Industrial Organization Banking and Finance written by Naoaki Minamihashi and published by . This book was released on 2011 with total page 204 pages. Available in PDF, EPUB and Kindle. Book excerpt: Abstract: This thesis evaluates the effects of regulation on the real economy in Industrial Organization, Banking and Finance. Chapter 1 shows that a regulation designed to promote competition in one market can decrease competition in another market. I build a data set on the construction of fiber-optic networks in Japan from 2005 to 2009. Using linear regressions and probit regressions, I find that when access pricing regulation is more binding, construction of new optical-fiber networks by facilities-based entrants decreases. In Chapter 2, I apply structural estimation techniques to this problem. Although I can learn the immediate effects of usage on investment decisions in reduced-form analysis, it is hard to learn the long-run effects on an oligopoly equilibrium without a dynamic structural model. By modeling competition in building fiber-optic networks as a dynamic game, we can analyze dynamic behavior of firms, and estimate profit and sunk cost. The estimation result shows that unbundling decreases profit from of building fiber lines for new entrants, and new entry decreases as a result. The results of Chapters 1 and 2, suggest that unbundling regulation during periods of new technology diffusion may reduce the price of service but also decrease competition in the infrastructure market. Chapter 3 investigates the mechanism by which bank failures affect the real economy from the lenders' perspective. Using a natural experimental setting of unique bank failures in Japan, this chapter identifies the credit crunch effect of bank failures. The main findings are the following. First, bank failures decrease the investment by client firms by approximately 30%. Second, the high investment growth/level firms deal with unhealthy banks. These choices generate a self-selection bias of 30-80%. Third, there is no evidence that the effect of a bank failure is related to the firms' accessibility to other financial sources. These findings suggest that large bank failures can trigger further recessions, if regulatory authorities do not prevent them.
Download or read book International Regulatory Rivalry in Open Economies written by Doha M. Abdelhamid and published by Ashgate Publishing, Ltd.. This book was released on 2003 with total page 512 pages. Available in PDF, EPUB and Kindle. Book excerpt: This text aims to fill a gap in the literature for a text on the theory and practice of international regulatory competition in the open financial markets of the US and UK.
Download or read book The Impact of Global Competition on United States Banking written by Bonita M. Kolb and published by . This book was released on 1993 with total page 286 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Impact of Regulatory Reforms on Large and Complex Financial Institutions written by Inci Ötker and published by INTERNATIONAL MONETARY FUND. This book was released on 2010-11-03 with total page 39 pages. Available in PDF, EPUB and Kindle. Book excerpt: Financial sector reforms are being considered to address the risks posed by large and complex financial institutions (LCFIs). The vast majority of global finance is intermediated by a handful of these institutions with growing interconnections within and across borders. Common trends that contributed to the recent global crisis included sharp increases in leverage, significant reliance on short-term wholesale funding, growth of off-balance-sheet activities, maturity mismatches, and increased share of revenues from complex products and trading activities. The key objective of the financial sector reforms is to promote a less leveraged, less risky (or better cushioned), and thus a more resilient financial system that supports strong and sustainable economic growth. The recent proposals of the Basel Committee on Banking Supervision (BCBS) on capital standards represent a substantial improvement in the quantity and quality of capital in comparison with the pre-crisis situation. The analysis of this paper suggests that, subject to usual caveats associated with limited data disclosures and availability, phase-in arrangements will allow most banks to move to these higher standards through earnings retention, assuming a modest economic and earnings outlook. It also suggests that should banks generate strong earnings in the coming years, and distribute lower dividends, they could rebuild common equity capital ratios faster than required under the current phase-in periods. The analysis of the paper also suggests that the new capital standards will have a significant impact on investment-banking-type activities, including through tighter requirements for trading book exposures. Investment banking activities will also be affected by a host of other regulatory initiatives, including the new accounting rules and higher standards for securitization, derivatives, and trading businesses, as well as measures to restrain certain activities. Yet, LCFIs with an investment banking focus have flexible business models and can adjust their strategies easily to mitigate the effects of the regulatory reforms, notwithstanding a multitude of regulations affecting their activities. The ultimate effect of the reforms on business models remains to be seen until the regulations take their final shape.
Download or read book Taking Firms and Markets Seriously written by Thomas Bernauer and published by . This book was released on 2010 with total page 26 pages. Available in PDF, EPUB and Kindle. Book excerpt: We argue that accounting for the behavior of firms and markets is important for understanding the extent and form and the effectiveness and efficiency of government regulation, particularly in economic policy. We examine the US banking sector and its regulation in the 1990s to gain insights on how studies along these lines could be constructed. We begin by observing that US bank capitalization exceeds governmental capital adequacy requirements by a substantial margin. This observation suggests that banks must also have reasons other than government intervention for selecting high levels of capital. We focus on the main alternative driving force to government regulation, market discipline, and in particular the effect of bank capital on banks' borrowing costs. We find that better capitalized banks have indeed experienced lower borrowing costs. But we also find that, while competitive pressure can help in mitigating the bank solvency problem, it cannot not fully counter free riding of unhealthy banks on a well-capitalized banking sector. These results show that recent US and international (Basel Accord) regulatory reform efforts, which are designed to increase transparency and enhance competition in the banking sector, can be interpreted as an effort to align market forces and regulation in ways that minimize the need for costly government enforcement or bailouts.
Download or read book Aligning Financial Supervisory Structures with Country Needs written by Jeffrey Carmichael and published by World Bank Publications. This book was released on 2004 with total page 290 pages. Available in PDF, EPUB and Kindle. Book excerpt: This publication contains the proceedings of an international conference on the regulation of financial institutions and supervisory structural reforms, held in Washington D.C., United States in December 2003 and involving participants from 52 countries. It considers case studies of experiences of regulatory reform approaches adopted in a number of countries including Australia, South Africa, Ireland, Sweden, Hungary and Estonia.
Download or read book Banking Deregulation and the New Competition in Financial Services written by S. Kerry Cooper and published by . This book was released on 1986 with total page 396 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Reforming the Bank Regulatory Structure written by Andrew S. Carron and published by . This book was released on 1984 with total page 70 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Economic Regulation and Its Reform written by Nancy L. Rose and published by . This book was released on 2014-01-01 with total page 619 pages. Available in PDF, EPUB and Kindle. Book excerpt: The past thirty years have witnessed a transformation of government economic intervention in broad segments of industry throughout the world. Many industries historically subject to economic price and entry controls have been largely deregulated, including natural gas, trucking, airlines, and commercial banking. However, recent concerns about market power in restructured electricity markets, airline industry instability amid chronic financial stress, and the challenges created by the repeal of the Glass-Steagall Act, which allowed commercial banks to participate in investment banking, have led to calls for renewed market intervention. "Economic Regulation and Its Reform" collects research by a group of distinguished scholars who explore these and other issues surrounding government economic intervention. Determining the consequences of such intervention requires a careful assessment of the costs and benefits of imperfect regulation. Moreover, government interventions may take a variety of forms, from relatively nonintrusive performance-based regulations to more aggressive antitrust and competition policies and barriers to entry. This volume introduces the key issues surrounding economic regulation, provides an assessment of the economic effects of regulatory reforms over the past three decades, and examines how these insights bear on some of today s most significant concerns in regulatory policy."
Download or read book Economic Regulation and Its Reform written by Nancy L. Rose and published by University of Chicago Press. This book was released on 2014-06-30 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The past thirty years have witnessed a transformation of government economic intervention in broad segments of industry throughout the world. Many industries historically subject to economic price and entry controls have been largely deregulated, including natural gas, trucking, airlines, and commercial banking. However, recent concerns about market power in restructured electricity markets, airline industry instability amid chronic financial stress, and the challenges created by the repeal of the Glass-Steagall Act, which allowed commercial banks to participate in investment banking, have led to calls for renewed market intervention. Economic Regulation and Its Reform collects research by a group of distinguished scholars who explore these and other issues surrounding government economic intervention. Determining the consequences of such intervention requires a careful assessment of the costs and benefits of imperfect regulation. Moreover, government interventions may take a variety of forms, from relatively nonintrusive performance-based regulations to more aggressive antitrust and competition policies and barriers to entry. This volume introduces the key issues surrounding economic regulation, provides an assessment of the economic effects of regulatory reforms over the past three decades, and examines how these insights bear on some of today’s most significant concerns in regulatory policy.
Download or read book The Evolution of Banking Regulation Since the Financial Crisis written by Andrea Sironi and published by . This book was released on 2019 with total page 61 pages. Available in PDF, EPUB and Kindle. Book excerpt: Following the 2008 financial crisis a major process of regulatory reform of the banking industry took place with the aim of increasing the resilience of the financial system. More specifically, the regulatory changes introduced after the financial crisis were aimed at pursuing three main objectives: (i) improve the resilience of individual banks, thereby reducing the risk of financial institutions to fail, (ii) improve the resilience of the financial system as a whole, limiting the risk of spillovers to the broader economy that would be triggered by the failure of large financial institutions, and (iii) reduce the risk for taxpayers to bear the cost of future banking crisis. Starting from an exam of the main weaknesses of the banking regulatory framework highlighted by the financial crisis, this paper provides a detailed analysis of the Basel 3 reform, its main goals, timing and technical features. It then examines the more recent revisions of the Basel 3 framework - often called “Basel 4” - and the new requirements associated to bank resolution policies, i.e. the “total loss absorbing capacity” (TLAC) and the “minimum required eligible liabilities” (MREL). These regulatory reforms are then critically discussed, both though the analysis of their impact on the banking industry, and with recourse to the available empirical evidence. This evidence shows that the banking industry did register a significant increase in the amount and quality of equity capital, mostly achieved through capital increases, and in liquidity. This led to a decrease in the probability of future large banks defaults and in the incentive for banks to take on excessive risks. Also, by introducing bail in mechanisms for banks' liabilities, these reforms reduced the likelihood of future crisis being supported by taxpayers via government bail outs. However, a number of threats are still being faced by the banking industry. These include profitability, a necessary condition for a bank to be sustainable over time, the sovereign-banks “doom loop”, and the possibility of future recessions, as banks' safety and soundness is inevitably linked to the state of the economy.
Download or read book Banking Reform written by Great Britain. Treasury and published by The Stationery Office. This book was released on 2013-02-04 with total page 64 pages. Available in PDF, EPUB and Kindle. Book excerpt: Banking reform is the second key pillar of the Government's programme for reform of the financial sector to address the weaknesses exposed by the financial crisis of 2007-09. The first pillar of this programme, reform of financial services regulation, has been legislated in the Financial Services Act that received Royal Assent in December 2012 (2012 Ch. 21, 9780105421122). The Government is now legislating to reform the structure of the UK banking system, through the Financial Services (Banking Reform) Bill (HCB 130, session 2012-13, ISBN 9780215053794) which implements key recommendations of the Independent Commission on Banking, including ring-fencing retail deposits from wholesale banking activities and depositor preference. This document accompanies introduction of the Bill and includes the Government response to the first report of the Parliamentary Commission on Banking Standards (PCBS), which conducted pre-legislative scrutiny on the draft Bill. The response explains where the Government has amended the Bill and includes and impact assessment for the Bill, along with the opinion of the independent Regulatory Policy Committee
