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Economic and financial debates

Working papers calling for a reflection on issues related to the economics of banking and insurance, and their regulation

Publication Economic and financial debates no. 15:
How to Measure Interconnectedness between Banks, Insurers and Financial Conglomerates?

Financial institutions’ interconnectedness is a key component of systemic risk. However there is still no consensus on its measurement. Using a unique database of network of exposures of French financial institutions, we compare three strategies to...

  • Published on 12/06/2014
  • FR
  • PDF (1.45 MB)
Publication Economic and financial debates no. 14:
Modelling and measuring business risk and the resiliency of retail banks

The paper uses recent developments of the methodology of efficiency frontiers to provide an original modeling of the risk of volatility of banking profits which relies on the estimation of a profit frontier. This methodology allows taking into account...

  • Published on 12/05/2014
  • FR
  • PDF (488.18 KB)
Publication Economic and financial debates no. 13:
Do LTV and DSTI caps make banks more resilient?

This study provides a few responses to the question of the effectiveness of Loan-To-Value (LTV) and Debt Service-To-Income (DSTI) caps to contribute to financial stability. Using a lender’s risk management perspective, the paper provides a new...

  • Published on 06/07/2014
  • FR
  • PDF (466.78 KB)
Publication Economic and financial debates no. 12:
Does the capital structure affect banks’ profitability? Pre- and post financial crisis evidence from significant banks in France

This paper studies the effect of banks’ capitalization on banks’ Return on Equity (ROE). A debate has emerged on the costs for banks of the increase in capital requirements under Basel III. We bring empirical evidence on this issue by analyzing the...

  • Published on 03/07/2014
  • FR
  • PDF (533.72 KB)
Publication Economic and financial debates no. 11:
Regulatory changes and the cost of equity: evidence from French banks

In the paper, we first investigate the impact of an increase in capital requirements on the equity risk (beta) of listed banks in France. We find that an increase in capital ratios reduces banks’ systematic risk. This leads to a decrease in...

  • Published on 03/07/2014
  • FR
  • PDF (398.21 KB)
Publication Economic and financial debates no. 10:
What is the information content of the SRISK measure as a supervisory tool?

The SRISK measure is advertised as measuring the recapitalization needed by a financial institution in the event of a financial crisis. It is computed from the estimated reaction of the institution’s share price ...

  • Published on 02/07/2014
  • FR
  • PDF (313.93 KB)