Risk and Valuation of Collateral Debt Obligations
... market imperfections. First, banks and certain other financial institutions have regulatory capital requirements that make it valuable for them to securitize and sell some portion of their assets, reducing the amount of (expensive) regulatory capital that they must hold. Second, individual bonds or ...
... market imperfections. First, banks and certain other financial institutions have regulatory capital requirements that make it valuable for them to securitize and sell some portion of their assets, reducing the amount of (expensive) regulatory capital that they must hold. Second, individual bonds or ...
NBER WORKING PAPER SERIES TO 2007 Patrick Bajari
... depart from the previous literature by allowing for default to result from either of two latent causes: …nancial incentives making default the action that maximizes lifetime utility and binding household liquidity constraints. The likelihood function of our model takes into account the fact that we ...
... depart from the previous literature by allowing for default to result from either of two latent causes: …nancial incentives making default the action that maximizes lifetime utility and binding household liquidity constraints. The likelihood function of our model takes into account the fact that we ...
A new approach to assessing risks to financial stability
... feedback effects to the real economy (indicated by the dotted line in Chart 2) should financial intermediation be materially impaired. In the quantitative work reported in the July 2006 FSR, the focus was on a summary indicator of system-wide impact — specifically, on the impact on the profits and c ...
... feedback effects to the real economy (indicated by the dotted line in Chart 2) should financial intermediation be materially impaired. In the quantitative work reported in the July 2006 FSR, the focus was on a summary indicator of system-wide impact — specifically, on the impact on the profits and c ...
NBER WORKING PAPER MARKETS AND PLANNING
... purposeof this paper is to focus on one dimension of these linkages- the possibility the planning horizon of the policy maker differs from that of the economic agent. This issue may be of special relevance for the default decisions in the context of country risk. The experience of ...
... purposeof this paper is to focus on one dimension of these linkages- the possibility the planning horizon of the policy maker differs from that of the economic agent. This issue may be of special relevance for the default decisions in the context of country risk. The experience of ...
MOF Risk Model for Operations
... members must be willing to identify risk without fear of retribution or criticism. The identification of a risk means the team faces one less unpleasant surprise. Until a risk is identified, the team cannot prepare for it. Use risk-based scheduling. Maintaining an environment often means making ch ...
... members must be willing to identify risk without fear of retribution or criticism. The identification of a risk means the team faces one less unpleasant surprise. Until a risk is identified, the team cannot prepare for it. Use risk-based scheduling. Maintaining an environment often means making ch ...
Incorporation of financial ratios into prudential definition of assets
... reflects the risks of underlying assets. The segregation also allows for benchmarking the bank against peer institutions and countries and evaluating its overall risk profile. Recent financial crisis highlighted that current asset classification systems differ across countries and institutions. More ...
... reflects the risks of underlying assets. The segregation also allows for benchmarking the bank against peer institutions and countries and evaluating its overall risk profile. Recent financial crisis highlighted that current asset classification systems differ across countries and institutions. More ...
Essays on Adverse Selection and Moral Hazard in Insurance Market
... asymmetric information is stated as the positive relation between the risk levels of those who purchase insurance coverage and the actual risk type revealed after losses occur (see Puelz & Snow, 1994). However, mixed results are reported in different business lines of insurance: the insignificance ...
... asymmetric information is stated as the positive relation between the risk levels of those who purchase insurance coverage and the actual risk type revealed after losses occur (see Puelz & Snow, 1994). However, mixed results are reported in different business lines of insurance: the insignificance ...
Banking Industry Country Risk Assessment
... 6. A BICRA analysis for a country covers rated and unrated financial institutions that take deposits, extend credit, or engage in both activities in a particular country. The analysis incorporates the entire financial system of a country by considering the relationship of the banking industry to the ...
... 6. A BICRA analysis for a country covers rated and unrated financial institutions that take deposits, extend credit, or engage in both activities in a particular country. The analysis incorporates the entire financial system of a country by considering the relationship of the banking industry to the ...
IOSR Journal Of Humanities And Social Science (IOSR-JHSS)
... risks. On the other hand, risk can be classified as business risk and financial risk. Business risk is the risk to the firm of being unable to covet fixed operating cost. It also arises from the nature of a firm’s business which relates to factors affecting the product market. Financial risk is the ...
... risks. On the other hand, risk can be classified as business risk and financial risk. Business risk is the risk to the firm of being unable to covet fixed operating cost. It also arises from the nature of a firm’s business which relates to factors affecting the product market. Financial risk is the ...
RELATIONSHIP BETWEEN MACROECONOMIC VARIABLES AND
... ensure lower inflation rate in the economy and create an insurance pool that will provide a low average lending interest rates which will improve the financial performance of companies in insurance industry as they are negatively correlated with each other. Lower interest rates will help improve the ...
... ensure lower inflation rate in the economy and create an insurance pool that will provide a low average lending interest rates which will improve the financial performance of companies in insurance industry as they are negatively correlated with each other. Lower interest rates will help improve the ...
Lease
... Conventional mortgage • Offered by a lender who assumes all the risk of loss Federal Housing Administration (FHA) mortgage insurance • Offers lenders mortgage insurance on loans having a high loan-to-value ratio • Intent is to encourage loans to home buyers who have very little money available for a ...
... Conventional mortgage • Offered by a lender who assumes all the risk of loss Federal Housing Administration (FHA) mortgage insurance • Offers lenders mortgage insurance on loans having a high loan-to-value ratio • Intent is to encourage loans to home buyers who have very little money available for a ...
Collateral and Credit Issues in Derivatives Pricing
... risk and consider the implications of the analysis for bid-offer spreads. The expected recovery rates on the derivative for the bank and its counterparty are allowed to be different from that on their other liabilities. One controversial issue, related to credit risk, is whether it is necessary for ...
... risk and consider the implications of the analysis for bid-offer spreads. The expected recovery rates on the derivative for the bank and its counterparty are allowed to be different from that on their other liabilities. One controversial issue, related to credit risk, is whether it is necessary for ...
Australia`s Authorised Depository Institutions The Capital–Assets Ratio
... • MV of equity per share: MV of equity ownership shares outstanding / numbers of shares. • BV of equity per share: (Par value of equity + surplus value + retained earnings + loan reserves) / number of shares. • Market to book ratio: MV / BV. Copyright 2007 McGraw-Hill Australia Pty Ltd PPTs t/a Fi ...
... • MV of equity per share: MV of equity ownership shares outstanding / numbers of shares. • BV of equity per share: (Par value of equity + surplus value + retained earnings + loan reserves) / number of shares. • Market to book ratio: MV / BV. Copyright 2007 McGraw-Hill Australia Pty Ltd PPTs t/a Fi ...
Tendency to Choose Big Audit Firms: Case of Indonesia
... Agency theory predicts that the awareness of principal and agent about the existence of moral hazard might be achieved by goal congruence or harmonization. The more complex the agency conflict, the greater the demand on external audit and the quality of audit (Palmrose, 1984; Francis & Wilson, 1988; ...
... Agency theory predicts that the awareness of principal and agent about the existence of moral hazard might be achieved by goal congruence or harmonization. The more complex the agency conflict, the greater the demand on external audit and the quality of audit (Palmrose, 1984; Francis & Wilson, 1988; ...
Reflections on Recent Target Date Glide-Path
... the contribution rate of all investors or for using a real (inflation-indexed) payout annuity as the hurdle in which to measure the resulting trade-off between risk and reward despite the fact that (A) inflation-indexed annuities are uncommon in the marketplace, and (B) individuals tend to behaviora ...
... the contribution rate of all investors or for using a real (inflation-indexed) payout annuity as the hurdle in which to measure the resulting trade-off between risk and reward despite the fact that (A) inflation-indexed annuities are uncommon in the marketplace, and (B) individuals tend to behaviora ...
A Centralised Investment Process: joined up
... Identifying a client’s financial requirements, connecting this requirement to their risk tolerance, building an investment portfolio with appropriate proportions in each asset class and then selecting the right funds to populate this portfolio, all in one seamless process, is the holy grail of inves ...
... Identifying a client’s financial requirements, connecting this requirement to their risk tolerance, building an investment portfolio with appropriate proportions in each asset class and then selecting the right funds to populate this portfolio, all in one seamless process, is the holy grail of inves ...
The Handbook of Mortgage-Backed Securities, 7th Edition
... such loans, often backed by similar underlying collateral types (e.g., residential mortgages), are purchased from originators by an arranger who bundles the underlying loans together into a pool. The arranger could be the Government National Mortgage Association (Ginnie Mae, a federal agency) or on ...
... such loans, often backed by similar underlying collateral types (e.g., residential mortgages), are purchased from originators by an arranger who bundles the underlying loans together into a pool. The arranger could be the Government National Mortgage Association (Ginnie Mae, a federal agency) or on ...
Spring 2013 Advanced Portfolio Management Solutions
... • The greater the number of retired lives, the greater the liquidity requirement, all else being equal • Wonka’s retired employees currently at 25%, so unlikely to create substantial liquidity requirement in the near future, even with 5% annual increases related to Consumer Price Index • The smaller ...
... • The greater the number of retired lives, the greater the liquidity requirement, all else being equal • Wonka’s retired employees currently at 25%, so unlikely to create substantial liquidity requirement in the near future, even with 5% annual increases related to Consumer Price Index • The smaller ...
Practical Applications of Post Modern Portfolio Theory
... unexpected gains are as bad (risky) as unexpected losses. However, the probability of experiencing an unexpected gain is not what a real-life investor considers risk. An unexpected loss is the type of risk investors are concerned about. In other words, making money unexpectedly isn’t risky: Losing m ...
... unexpected gains are as bad (risky) as unexpected losses. However, the probability of experiencing an unexpected gain is not what a real-life investor considers risk. An unexpected loss is the type of risk investors are concerned about. In other words, making money unexpectedly isn’t risky: Losing m ...
Diversification, Pricing, Policy and Credit Union Risk
... management systems make a study of credit union behaviour particularly interesting. Fourth, we use data for Australian credit unions because of the detailed disaggregation of fee-based revenues that is available in the APRA quarterly general returns. In addition to a comprehensive break-down of inte ...
... management systems make a study of credit union behaviour particularly interesting. Fourth, we use data for Australian credit unions because of the detailed disaggregation of fee-based revenues that is available in the APRA quarterly general returns. In addition to a comprehensive break-down of inte ...
Information Asymmetry in Syndicated Loans
... represent a very small percentage of syndicated loans in the U.S. (less than 1%), they are more popular in Europe (11%) and Asia (8%). Since, by definition, privately placed loans deals are structured differently than syndications and involve more informed (about each other) parties, they represent ...
... represent a very small percentage of syndicated loans in the U.S. (less than 1%), they are more popular in Europe (11%) and Asia (8%). Since, by definition, privately placed loans deals are structured differently than syndications and involve more informed (about each other) parties, they represent ...
Draft FRS 104 - Accounting Standards Council
... fair value, a policyholder’s option to surrender an insurance contract for a fixed amount (or for an amount based on a fixed amount and an interest rate), even if the exercise price differs from the carrying amount of the host insurance liability. However, the requirement in FRS 39 does apply to a p ...
... fair value, a policyholder’s option to surrender an insurance contract for a fixed amount (or for an amount based on a fixed amount and an interest rate), even if the exercise price differs from the carrying amount of the host insurance liability. However, the requirement in FRS 39 does apply to a p ...
Choices and Best Practice in Corporate Risk Management Disclosure
... method and gathering other information about the nature and management of their risk exposures. The larger goal of our study was to investigate how both firm-specific and industry-level characteristics work together to shape corporate choices of disclosure method. Our analysis was guided by the reco ...
... method and gathering other information about the nature and management of their risk exposures. The larger goal of our study was to investigate how both firm-specific and industry-level characteristics work together to shape corporate choices of disclosure method. Our analysis was guided by the reco ...
Exploring Racial Disparities in High Cost Lending
... blacks were almost three times more likely to receive a subprime first lien home purchase mortgage than whites, and Hispanics were 2.6 times more likely than whites to receive such loans. There are a variety of explanations for these stark racial disparities in subprime lending, ranging from underly ...
... blacks were almost three times more likely to receive a subprime first lien home purchase mortgage than whites, and Hispanics were 2.6 times more likely than whites to receive such loans. There are a variety of explanations for these stark racial disparities in subprime lending, ranging from underly ...
exp06-Nagel 3988118 en
... Our findings suggest that individual investors’ willingness to bear financial risks is historydependent. Cohorts that have experienced higher stock market returns over the course of their life are more willing to invest in risky assets. From a theoretical perspective, this kind of behavior could be ...
... Our findings suggest that individual investors’ willingness to bear financial risks is historydependent. Cohorts that have experienced higher stock market returns over the course of their life are more willing to invest in risky assets. From a theoretical perspective, this kind of behavior could be ...