Disclosure, Transparency, and Market Discipline PDF Download

Author: Xavier Freixas
Publisher:
ISBN:
Category :
Languages : en
Pages :

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Author: Elena Bundaleska
Publisher: LAP Lambert Academic Publishing
ISBN: 9783846514917
Category :
Languages : en
Pages : 316

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Book Description
Developing disclosure rules and requirements means more than just addressing the relevant needs for information. In order to be efficient they need to achieve true business benefits for the ones that disclose the information and for the ones that are supposed to use the information. By being given numerous reporting and disclosure obligations, banks are exposed to significant costs, due to which they are pressured to redistribute the resources, falling short on the business i.e. income driving side. Knowing this, is there an economic and other justification for Pillar 3 of Basel II? Is it a time for new and improved disclosure solution that will not increase the quantity of the existing disclosure requirements, but will assure transparency in the operations of the banks, will provide for sufficient information, and what's most important, will not require additional resources?

Author: C. E. V. Borio
Publisher: MIT Press
ISBN: 9780262025751
Category : Business & Economics
Languages : en
Pages : 472

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Book Description
Leading academics and policymakers address the theory of market discipline and consider evidence across different industries and countries. The effectiveness of market discipline -- the strong built-in incentives that encourage banks and financial systems to operate soundly and efficiently -- commands much attention today, particularly in light of recent accounting scandals. As government discipline, in the form of regulation, seems to grows less effective as the banking industry and financial markets grow more complex, the role of market discipline becomes increasingly important. In this collection, which grew out of a conference cosponsored by the Federal Reserve Bank of Chicago and the Bank for International Settlements in Basel, Switzerland, a diverse group of academics and policymakers address different aspects of the ability of market discipline to affect corporate behavior and performance. A major purpose of the book is to develop evidence on how market discipline operates across non-government regulated industries and in different countries, how successful it has been, and how it may transfer to a regulated industry. The chapters examine such topics as the theory of market discipline, evidence of market discipline in banking and other industries, evidence of market discipline for countries, the current state of corporate governance, and the interaction of market discipline and public policy.

Author: Cristina Palfi
Publisher:
ISBN:
Category :
Languages : en
Pages : 10

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One of the latest important changes in the banking system, as a result of the globalization, is the implementation of the Basle II Accord, designed to enhance risk management for banks, thus strengthening financial stability, as well. Its third pillar is aimed at making effective use of market discipline by developing a more detailed set of disclosure requirements to the supervisory authority and to the public. The increase in transparency diminishes informational asymmetry and thus risks may be more easily assessed. Banking supervisory authorities, as users of banks' financial statements, have a strong interest in promoting sound and high quality accounting standards, as well as transparent and comparable financial statements that would strengthen market discipline and enhance financial stability. That's why the Basle Committee strongly supports efforts to harmonise accounting practice internationally, so that it could strengthen and make more transparent the link between measurement standards, public reporting and prudential requirements.

Author: François Guillemin
Publisher:
ISBN:
Category :
Languages : en
Pages : 32

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This paper investigates the role of bank voluntary disclosure, as a source of information about risk, in the interbank market. Using data on the 179 largest Russian banks over the period of 2004-2013 we test whether the ability to attract interbank loans is sensitive to various transparency indices such as those disclosing bank risks, board composition, or even corporate event details. We show that larger but riskier banks - at least in terms of credit risk - behave more transparently and disclose more. The article is also the first to provide evidence that the ability to attract funds in the interbank market is positively correlated with the degree of transparency. This result is stable for various aspects of disclosure.

Author: Daniel Bar Aharon
Publisher: BRILL
ISBN: 9004549072
Category : Law
Languages : en
Pages : 71

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In Financial Transparency & Information Asymmetry: A critical perspective of EU disclosure regime, Daniel Bar Aharon offers an interdisciplinary critical analysis addressing the inherent limitations mandated disclosure have on market discipline.

Author: Ursel Baumann
Publisher:
ISBN:
Category :
Languages : en
Pages :

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Book Description
A paper presented at the October 2003 conference quot;Beyond Pillar 3 in International Banking Regulation: Disclosure and Market Discipline of Financial Firms,quot; cosponsored by the Federal Reserve Bank of New York and the Jerome A. Chazen Institute of International Business at Columbia Business School.

Author: Ari Hyytinen
Publisher:
ISBN:
Category :
Languages : en
Pages : 34

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Book Description
Transparency regulation aims at reducing financial fragility by strengthening market discipline.There are however two elementary properties of banking that may render such regulation inefficient at best and detrimental at worst.First, an extensive financial safety net may eliminate the disciplinary effect of transparency regulation.Second, achieving transparency is costly for banks, as it dilutes their charter values, and hence it also reduces their private costs of risk-taking.We consider both the direct costs of complying with disclosure requirements and the indirect transparency costs stemming from imperfect property rights governing information and specify the conditions under which transparency regulation can (and cannot) reduce financial fragility. Key words: information disclosure, market discpline, bank transparency, deposit insurance, financial safety net.

Author: World Bank
Publisher: World Bank Publications
ISBN: 1464814961
Category : Business & Economics
Languages : en
Pages : 281

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Book Description
Over a decade has passed since the collapse of the U.S. investment bank, Lehman Brothers, marked the onset of the largest global economic crisis since the Great Depression. The crisis revealed major shortcomings in market discipline, regulation and supervision, and reopened important policy debates on financial regulation. Since the onset of the crisis, emphasis has been placed on better regulation of banking systems and on enhancing the tools available to supervisory agencies to oversee banks and intervene speedily in case of distress. Drawing on ten years of data and analysis, Global Financial Development Report 2019/2020 provides evidence on the regulatory remedies adopted to prevent future financial troubles, and sheds light on important policy concerns. To what extent are regulatory reforms designed with high-income countries in mind appropriate for developing countries? What has been the impact of reforms on market discipline and bank capital? How should countries balance the political and social demands for a safety net for users of the financial system with potentially severe moral hazard consequences? Are higher capital requirements damaging to the flow of credit? How should capital regulation be designed to improve stability and access? The report provides a synthesis of what we know, as well as areas where more evidence is still needed. Global Financial Development Report 2019/2020 is the fifth in a World Bank series. The accompanying website tracks financial systems in more than 200 economies before, during, and after the global financial crisis (http://www.worldbank.org/en/publication/gfdr) and provides information on how banking systems are regulated and supervised around the world (http://www.worldbank.org/en/research/brief/BRSS).

Author: Pedro de Araujo
Publisher:
ISBN:
Category :
Languages : en
Pages :

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Book Description
Financial regulators are challenged with finding the most efficient and effective ways to monitor banks given an expanding and complex international financial system. Market discipline has grown in importance as a way to discourage banks from taking on unnecessary risk (Barth et al., 2004; Nier & Baumann, 2006). One of the main drivers of market discipline is information disclosure. While the literature on market discipline is expansive, there are no known studies on the impact of individual information disclosure requirements on market discipline. Our study investigates which specific disclosure requirements influence financial investors to discipline banks and which do not. We find that more than half of the information disclosure requirements potentially reduce or have no impact on market discipline practices while the remaining requirements may enhance financial investors' response to bank risk.