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Most sRNA biogenesis mechanisms involve either RNAseIII cleavage or ping-pong amplification by different Piwi proteins harboring slicer activity. Here, we follow the question why the mechanism of transgene-induced silencing in the ciliate Paramecium needs both Dicer activity and two Ptiwi proteins. This pathway involves primary siRNAs produced from non-translatable transgenes and secondary siRNAs from endogenous remote loci. Our data does not indicate any signatures from ping-pong amplification but Dicer cleavage of long dsRNA. We show that Ptiwi13 and 14 have different preferences for primary and secondary siRNAs but do not load them mutually exclusive. Both Piwis enrich for antisense RNAs and Ptiwi14 loaded siRNAs show a 5′-U signature. Both Ptiwis show in addition a general preference for Uridine-rich sRNAs along the entire sRNA length. Our data indicates both Ptiwis and 2’-O-methylation to contribute to strand selection of Dicer cleaved siRNAs. This unexpected function of two distinct vegetative Piwis extends the increasing knowledge of the diversity of Piwi functions in diverse silencing pathways. As both Ptiwis show differential subcellular localisation, Ptiwi13 in the cytoplasm and Ptiwi14 in the vegetative macronucleus, we conclude that cytosolic and nuclear silencing factors are necessary for efficient chromatin silencing.
The publication of the Liikanen Group's final report in October 2012 was surrounded by high expectations regarding the implementation of the reform plans through the proposed measures that reacted to the financial and sovereign debt crises. The recommendations mainly focused on introducing a mild version of banking separation and the creation of the preconditions for bail-in measures. In this article, we present an overview of the regulatory reforms, to which the financial sector has been subject over the past years in accordance with the concepts laid out in the Liikanen Report. It becomes clear from our assessment that more specific steps have yet to be taken before the agenda is accomplished. In particular, bail-in rules must be implemented more consistently. Beyond the question of the required minimum, the authors develop the notion of a maximum amount of liabilities subject to bail-in. The combination of both components leads to a three-layer structure of bank capital: a bail-in tranche, a deposit-insured bailout tranche, and an intermediate run-endangered mezzanine tranche. The size and treatment of the latter must be put to a political debate that weighs the costs and benefits of a further increase in financial stability beyond that achieved through loss-bearing of the bail-in tranche.
An important prerequisite for the efficiency of bail-in as a regulatory tool is that debt holders are able to bear the cost of a bail-in. Examining European banks’ subordinated debt we caution that households may be investors in bail-in able bonds. Since households do not fulfil the aforementioned prerequisite, we argue that European bank supervisors need to ensure that banks’ bail-in bonds are held by sophisticated investors. Existing EU market regulation insufficiently addresses mis-selling of bail-in instruments.
This paper analyzes the effect of financial constraints on firms' corporate social responsibility. Exploiting heterogeneity in firms' exposure to a monetary policy shock in the U.S., which reduced financial constraints for some firms, I find that firms increase their environmental responsibility. I use facility-level data to account for unobservable time-varying influences on pollution and find that toxic emissions decrease when parent companies are more exposed to the monetary policy shock. I further find that these facilities are also more likely to implement pollution abatement activities. Examining within-parent company heterogeneity I find that pollution abatement investments center on facilities at greater risk of facing additional costs due to environmental regulation. The findings are consistent with the idea that a reduction in financial constraints reduces pollution as it allows firms to implement pollution abatement measures.
Von Februar bis Juni 2015 hat die Europäische Zentralbank (EZB) die Notfall-Liquiditätshilfen (emergency liquidity assistance, ELA) für griechische Banken von 50 auf etwa 90 Milliarden Euro ausgeweitet. Dies hat zu einer Diskussion unter Wissenschaftlern, Politikern und Praktikern geführt, ob diese Liquiditätshilfen rechtmäßig sind. Es wurde der Vorwurf erhoben, die EZB trage bewusst zu einer Konkursverschleppung der bereits insolventen griechischen Banken bei.
Wir nehmen diesen Vorwurf zum Anlass, die Grundsätze des ELA-Programms genauer zu betrachten und die Frage zu diskutieren, ob das Programm in der aktuellen Situation rechtmäßig war. Zunächst beschreiben wir hierfür aus finanzwirtschaftlicher Perspektive die komplexe Beziehung zwischen der Europäischen Union, der EZB und den griechischen Banken. Dabei gehen wir insbesondere auf die wirtschaftspolitischen Grundsätze einer Währungsunion mit einer unvollständigen Fiskalunion (oder Haushaltskonsolidierung) ein. Vor diesem Hintergrund analysieren wir dann die Entscheidung der EZB, weiterhin Liquiditätshilfen an griechische Banken bereitzustellen. Wir kommen zu dem Ergebnis, dass das Vorgehen der EZB nicht als Konkursverschleppung zu bezeichnen ist.
The European Central Bank (ECB) increased the emergency liquidity assistance (ELA) for Greek banks from €50 billion in February 2015 to approximately €90 billion in June 2015. Its actions were accompanied by a discussion among academics, politicians and practitioners regarding the legitimacy of the ELA. Some have even accused the ECB of deliberately delaying the bankruptcy filing of already insolvent Greek banks.
We take the claim regarding insolvency delay as an opportunity to highlight the underlying economics of the ELA program and discuss its legitimacy in the current situation. We start by characterizing the complex interrelationship of the European Union, the ECB and the Greek banks through the lens of financial economics, with a particular focus on the political economy of a monetary union with incomplete fiscal union (or fiscal consolidation). Combining these two issues, we examine the decision of the ECB to continue the provision of ELA to Greek banks. Our conclusions, drawn from the analysis, do not support the claim that the ECB’s actions are consistent with a delayed filing for insolvency.
Als geladener Sachverständiger argumentierte Martin Götz bei der öffentlichen Anhörung des Finanzausschusses des Deutschen Bundestags und in seiner vorliegenden Stellungnahme, dass durch die zügige Umsetzung der Richtlinie 2014/59/EU die Selbstregulierung von Kreditinstituten und Wertpapierfirmen weiter gestärkt wird und das aufsichtsrechtliche Instrumentarium um marktorientierte Mechanismen ausgebaut wird. Er erwartet, dass das Umsetzungsgesetz die Finanzstabilität in Deutschland fördert. Positiv sei insbesondere die Ausgestaltung der Möglichkeit einer verpflichtenden Gläubigerbeteiligung („Bail-in“) im Rahmen der Abwicklung, da der Bail-in nicht nur Fragen der Privathaftung im Abwicklungsfall klärt, sondern auch gute Anreize zur Selbstregulierung von Kreditinstituten setzt. Den Verzicht auf die Umsetzung der in der Abwicklungsrichtlinie enthaltenen staatlichen Stabilisierungsmöglichkeiten bewertet er als positiv und sieht darin einen wichtigen Baustein zur Förderung der Selbstregulierung von Finanzinstituten. Die Verlängerung der Laufzeit des Finanzmarktstabilisierungsfonds sei problematisch, da die explizite Möglichkeit einer staatlichen Hilfe dem Anreiz zur Selbstregulierung von Finanzinstituten entgegensteht.
According to the Bank Recovery and Resolution Directive (BRRD), introduced as a lesson from the recent financial crisis, the losses a failing bank incurred should generally be borne by its investors. Before a minimum bail-in has occurred, government money can only be injected in emergency cas-es to remedy a serious disturbance in the economy and to preserve financial stability. This policy letter argues that in case of the Italian Bank Monte dei Paschi di Siena (MPS), which the Italian gov-ernment currently plans to bail out, a resolution would most likely not cause such a systemic event. A bailout contrary to the existing rules will lead to a mispricing of bank capital and retard the re-structuring of the European banking sector, the authors write. They appeal to the European Central Bank, the Systemic Risk Board and the EU Commission to follow the rules as the test-case MPS will have a direct impact on the credibility of the new BRRD regime and the responsible institutions.
Exploiting heterogeneity in U.S. firms' exposure to an unconventional monetary policy shock that reduced debt financing costs, I identify the impact of financing conditions on firms' toxic emissions. I find robust evidence that lower financing costs reduce toxic emissions and boost investments in emission reduction activities, especially capital-intensive pollution control activities. The effect is stronger for firms in noncompliance with environmental regulation. Examining the ability of regaining regulatory compliance by implementing pollution control activities I find that only capital-intensive activities help firms regaining compliance. These findings underscore the impact of firms' financing conditions for emissions and the environment.
Households buy life insurance as part of their liquidity management. The option to surrender such a policy can serve as a buffer when a household faces a liquidity need. In this study, we investigate empirically which individual and household specific sociodemographic factors influence the surrender behavior of life insurance policyholders. Based on the Socio-Economic Panel (SOEP), an ongoing wide-ranging representative longitudinal study of around 11,000 private households in Germany, we construct a proxy to identify life insurance surrender in the data. We use this proxy to conduct fixed effect regressions and support the results with survival analyses. We find that life events that possibly impose a liquidity shock to the household, such as birth of a child and divorce increase the likelihood to surrender an existing life insurance policy for an average household in the panel. The acquisition of a dwelling and unemployment are further aspects that can foster life insurance surrender. Our results are robust with respect to different models and hold conditioning on region specific trends; they vary however for different age groups. Our analyses contribute to the existing literature supporting the emergency fund hypothesis. The findings obtained in this study can help life insurers and regulators to detect and understand industry specific challenges of the demographic change.
In this note, we first highlight different developments for banks under direct ECB supervision within the SSM that may prompt further investigation by supervisors. We find that banks that were weakly capitalized at the start of direct ECB supervision (1) still face elevated levels of non-performing loans, (2) are less cost-efficient and (3) reduced their share of subordinated debt financing over the last years. We then stress the importance of continuous and ongoing cost-benefit analysis regarding banking supervision in Europe. We also encourage processes to question existing supervisory practices to ensure a lean and efficient banking supervision. Finally, we underline the need of continuous and intensified coordination among regulatory bodies in the Banking Union since the efficacy of European bank supervision rests on its interplay with many different institutions.
This document was requested by the European Parliament's Committee on Economic and Monetary Affairs. It was originally published on the European Parliament’s webpage.
Bank regulators have the discretion to discipline banks by executing enforcement actions to ensure that banks correct deficiencies regarding safe and sound banking principles. We
highlight the trade-offs regarding the execution of enforcement actions for financial stability. Following this we provide an overview of the differences in the legal framework governing supervisors’ execution of enforcement actions in the Banking Union and the United States. After discussing work on the effect of enforcement action on bank behaviour and the real economy, we present data on the evolution of enforcement actions
and monetary penalties by U.S. regulators. We conclude by noting the importance of supervisors to levy efficient monetary penalties and stressing that a division of competences among different regulators should not lead to a loss of efficiency regarding
the execution of enforcement actions.
Households buy life insurance as part of their liquidity management. The option to surrender such a policy can serve as a buffer when a household faces a liquidity need. In this study, we investigate empirically which individual and household specific sociodemographic factors influence the surrender behavior of life insurance policyholders. Based on the Socio-Economic Panel (SOEP), an ongoing wide-ranging representative longitudinal study of around 11,000 private households in Germany, we construct a proxy to identify life insurance surrender in the data. We use this proxy to conduct fixed effect regressions and support the results with survival analyses. We find that life events that possibly impose a liquidity shock to the household, such as birth of a child and divorce increase the likelihood to surrender an existing life insurance policy for an average household in the panel. The acquisition of a dwelling and unemployment are further aspects that can foster life insurance surrender. Our results are robust with respect to different models and hold conditioning on region specific trends; they vary however for different age groups. Our analyses contribute to the existing literature supporting the emergency fund hypothesis. The findings obtained in this study can help life insurers and regulators to detect and understand industry specific challenges of the demographic change.
In the stomach, neoplastic lesions often arise in the setting of precursor conditions such as gastritis, intestinal metaplasia, or adenomatous lesions. Biopsies may, therefore, underestimate disease severity or even miss the diagnosis (sampling error). Endomicroscopy is able to visualize typical features of such pathologies. It enables in vivo microscopy of gastritis with definition of enhanced vascularity and vascular leakage, but the typical cobblestone appearance of the gastric mucosa is preserved. The presence of intestinal metaplasia is confirmed by columnar absorptive cells with brush border and goblet cells within villiform foveolar epithelium. Gastric neoplasia is characterized by crowded glands with intraluminal folding and glandular budding and branching accompanied by increased density of dilated and distorted capillaries. Finally, in gastric cancer, gland and overall mucosal architecture is progressively lost. These features are shown side by side with white-light endoscopic findings. Endomicroscopy is used in such a setting to rapidly screen larger areas (optical biopsies) and subsequently target tissue sampling to areas with highly suspicious microscopic patterns. In experienced hands, it therefore constitutes an important part especially in the presence of neoplastic lesions within noncircumscript gastric premalignant conditions. This article is part of an expert video encyclopedia.