Regulatory influence on market conditions in the banking union : the cases of macro-prudential instruments and the bail-in tool

This paper looks into the specific influence that the European banking union will have on (future) bank client relationships. It shows that the intended regulatory influence on market conditions in principle serves as a 
This paper looks into the specific influence that the European banking union will have on (future) bank client relationships. It shows that the intended regulatory influence on market conditions in principle serves as a powerful governance tool to achieve financial stability objectives. 
From this vantage, it analyzes macro-prudential instruments with a particular view to mortgage lending markets – the latter have been critical in the emergence of many modern financial crises. In gauging the impact of the new European supervisory framework, it finds that the ECB will lack influence on key macro-prudential tools to push through more rigid supervisory policies vis-à-vis forbearing national authorities. 
Furthermore, this paper points out that the current design of the European bail-in tool supplies resolution authorities with undue discretion. This feature which also afflicts the SRM imperils the key policy objective to re-instill market discipline on banks’ debt financing operations. The latter is also called into question because the nested regulatory technique that aims at preventing bail-outs unintendedly opens additional maneuvering space for political decision makers.
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Metadaten
Author:Tobias Tröger
URN:urn:nbn:de:hebis:30:3-371458
URL:http://www.imfs-frankfurt.de/fileadmin/user_upload/IMFS_WP/IMFS_WP_93.pdf
Parent Title (English):Working paper series / Institute for Monetary and Financial Stability ; 93
Series (Serial Number):Working Paper Series : Institute for Monetary and Financial Stability (93)
Publisher:Johann Wolfgang Goethe-Univ., Inst. for Monetary and Financial Stability
Place of publication:Frankfurt am Main
Document Type:Working Paper
Language:English
Date of Publication (online):2015/06/02
Date of first Publication:2015/06/02
Publishing Institution:Universitätsbibliothek Johann Christian Senckenberg
Release Date:2015/07/27
Tag:bail-in; banking union; macro-prudential supervision; market discipline; real estate lending
Pagenumber:22
HeBIS PPN:362914915
Institutes:Wirtschaftswissenschaften
Institute for Monetary and Financial Stability (IMFS)
Center for Financial Studies (CFS)
Sustainable Architecture for Finance in Europe (SAFE)
Dewey Decimal Classification:330 Wirtschaft
JEL-Classification:E44 Financial Markets and the Macroeconomy
G01 Financial Crises (Updated!)
G18 Government Policy and Regulation
G21 Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
G28 Government Policy and Regulation
K22 Corporation and Securities Law
K23 Regulated Industries and Administrative Law
Sammlungen:Universitätspublikationen
Licence (German):License LogoDeutsches Urheberrecht

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