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This paper investigates the impact of IT standardization on bank performance based on a panel of 457 German savings banks over the period from 1996 to 2006. We measure IT standardization as the fraction of IT expenses for centralized services over banks' total IT expenses. Bank efficiency, in turn, is measured by traditional accounting performance indicators as well as by cost and profit efficiencies that are estimated by a stochastic frontier approach. Our results suggest that IT standardization is conducive to cost efficiency. The relation is positive and robust for small and medium-sized banks but vanishes for very large banks. Furthermore, our study confirms the often cited computer paradox by showing that total IT expenditures negatively impact cost efficiency and have no influence on bank profits. To the best of our knowledge, this paper is first to empirically explore whether IT standardization enhances efficiency by employing genuine data of banks' IT expenditures. JEL Classification: C23, G21 Keywords: IT standardization, cost and profit efficiency, savings banks
We show that banks that are facing relatively high locally non-diversifiable risks in their home region expand more across states than banks that do not face such risks following branching deregulation in the 1990s and 2000s. These banks with high locally non-diversifiable risks also benefit relatively more from deregulation in terms of higher bank stability. Further, these banks expand more into counties where risks are relatively high and positively correlated with risks in their home region, suggesting that they do not only diversify but also build on their expertise in local risks when they expand into new regions.
This paper tests whether an increase in insured deposits causes banks to become more risky. We use variation introduced by the U.S. Emergency Economic Stabilization Act in October 2008, which increased the deposit insurance coverage from $100,000 to $250,000 per depositor and bank. For some banks, the amount of insured deposits increased significantly; for others, it was a minor change. Our analysis shows that the more affected banks increase their investments in risky commercial real estate loans and become more risky relative to unaffected banks following the change. This effect is most distinct for affected banks that are low capitalized.
In the wake of the recent financial crisis, significant regulatory actions have been taken aimed at limiting risks emanating from trading in bank business models. Prominent reform proposals are the Volcker Rule in the U.S., the Vickers Report in the UK, and, based on the Liikanen proposal, the Barnier proposal in the EU. A major element of these reforms is to separate “classical” commercial banking activities from securities trading activities, notably from proprietary trading. While the reforms are at different stages of implementation, there is a strong ongoing discussion on what possible economic consequences are to be expected. The goal of this paper is to look at the alternative approaches of these reform proposals and to assess their likely consequences for bank business models, risk-taking and financial stability. Our conclusions can be summarized as follows: First, the focus on a prohibition of only proprietary trading, as envisaged in the current EU proposal, is inadequate. It does not necessarily reduce risk-taking and it likely crowds out desired trading activities, thereby negatively affecting financial stability. Second, there is potentially a better solution to limit excessive trading risk at banks in terms of potential welfare consequences: Trading separation into legally distinct or ring-fenced entities within the existing banking organizations. This kind of separation limits cross-subsidies between banking and proprietary trading and diminishes contagion risk, while still allowing for synergies across banking, non-proprietary trading and proprietary trading.
We document that natural disasters significantly weaken the stability of banks with business activities in affected regions, as reflected in lower z-scores, higher probabilities of default, higher non-performing assets ratios, higher foreclosure ratios, lower returns on assets and lower bank equity ratios. The effects are economically relevant and suggest that insurance payments and public aid programs do not sufficiently protect bank borrowers against financial difficulties. We also find that the adverse effects on bank stability dissolve after some years if no further disasters occur in the meantime.
In the wake of the recent financial crisis, significant regulatory actions have been taken aimed at limiting risks emanating from banks’ trading activities. The goal of this paper is to look at the alternative reforms in the US, the UK and the EU, specifically with respect to the role of proprietary trading. Our conclusions can be summarized as follows: First, the focus on a prohibition of proprietary trading, as reflected in the Volcker Rule in the US and in the current proposal of the European Commission (Barnier proposal), is inadequate. It does not necessarily reduce risk-taking and it is likely to crowd out desired trading activities, thereby possibly affecting financial stability negatively. Second, trading separation into legally distinct or ring-fenced entities within the existing banking organizations, as suggested under the Vickers Report for the UK and the Liikanen proposal for the EU, is a more effective solution. Separation limits cross-subsidies between banking and proprietary trading and diminishes contagion risk, while still allowing for synergies and risk management across banking, non-proprietary trading and proprietary trading.
This paper explores how banks adjust their risk-based capital ratios and asset allocations following an exogenous shock to their asset quality caused by Hurricane Katrina in 2005. We find that independent banks based in the disaster areas increase their risk-based capital ratios after the hurricane, while those part of a bank holding company do not. The effect on independent banks mainly comes from the subgroup of high-capitalized banks. These banks increase their holdings in government securities and reduce loans to non-financial firms. Hence, banks that become more stable achieve this at the cost of reduced lending.
Purpose: In the clinical routine, detection of focal cortical dysplasia (FCD) by visual inspection is challenging. Still, information about the presence and location of FCD is highly relevant for prognostication and treatment decisions. Therefore, this study aimed to develop, describe and test a method for the calculation of synthetic anatomies using multiparametric quantitative MRI (qMRI) data and surface-based analysis, which allows for an improved visualization of FCD.
Materials and Methods: Quantitative T1-, T2- and PD-maps and conventional clinical datasets of patients with FCD and epilepsy were acquired. Tissue segmentation and delineation of the border between white matter and cortex was performed. In order to detect blurring at this border, a surface-based calculation of the standard deviation of each quantitative parameter (T1, T2, and PD) was performed across the cortex and the neighboring white matter for each cortical vertex. The resulting standard deviations combined with measures of the cortical thickness were used to enhance the signal of conventional FLAIR-datasets. The resulting synthetically enhanced FLAIR-anatomies were compared with conventional MRI-data utilizing regions of interest based analysis techniques.
Results: The synthetically enhanced FLAIR-anatomies showed higher signal levels than conventional FLAIR-data at the FCD sites (p = 0.005). In addition, the enhanced FLAIR-anatomies exhibited higher signal levels at the FCD sites than in the corresponding contralateral regions (p = 0.005). However, false positive findings occurred, so careful comparison with conventional datasets is mandatory.
Conclusion: Synthetically enhanced FLAIR-anatomies resulting from surface-based multiparametric qMRI-analyses have the potential to improve the visualization of FCD and, accordingly, the treatment of the respective patients.
Cortical changes in epilepsy patients with focal cortical dysplasia: new insights with T2 mapping
(2020)
Background: In epilepsy patients with focal cortical dysplasia (FCD) as the epileptogenic focus, global cortical signal changes are generally not visible on conventional MRI. However, epileptic seizures or antiepileptic medication might affect normal-appearing cerebral cortex and lead to subtle damage. Purpose: To investigate cortical properties outside FCD regions with T2-relaxometry. Study Type: Prospective study. Subjects: Sixteen patients with epilepsy and FCD and 16 age-/sex-matched healthy controls. Field Strength/Sequence: 3T, fast spin-echo T2-mapping, fluid-attenuated inversion recovery (FLAIR), and synthetic T1-weighted magnetization-prepared rapid acquisition of gradient-echoes (MP-RAGE) datasets derived from T1-maps. Assessment: Reconstruction of the white matter and cortical surfaces based on MP-RAGE structural images was performed to extract cortical T2 values, excluding lesion areas. Three independent raters confirmed that morphological cortical/juxtacortical changes in the conventional FLAIR datasets outside the FCD areas were definitely absent for all patients. Averaged global cortical T2 values were compared between groups. Furthermore, group comparisons of regional cortical T2 values were performed using a surface-based approach. Tests for correlations with clinical parameters were carried out. Statistical Tests: General linear model analysis, permutation simulations, paired and unpaired t-tests, and Pearson correlations. Results: Cortical T2 values were increased outside FCD regions in patients (83.4 ± 2.1 msec, control group 81.4 ± 2.1 msec, P = 0.01). T2 increases were widespread, affecting mainly frontal, but also parietal and temporal regions of both hemispheres. Significant correlations were not observed (P ≥ 0.55) between cortical T2 values in the patient group and the number of seizures in the last 3 months or the number of anticonvulsive drugs in the medical history. Data Conclusion: Widespread increases in cortical T2 in FCD-associated epilepsy patients were found, suggesting that structural epilepsy in patients with FCD is not only a symptom of a focal cerebral lesion, but also leads to global cortical damage not visible on conventional MRI. Evidence Level: 21. Technical efficacy Stage: 3 J. MAGN. RESON. IMAGING 2020;52:1783–1789.
Magnetic resonance imaging (MRI) is the gold standard imaging technique for diagnosis and monitoring of many neurological diseases. However, the application of conventional MRI in clinical routine is mainly limited to the visual detection of macroscopic tissue pathology since mixed tissue contrasts depending on hardware and protocol parameters hamper its application for the assessment of subtle or diffuse impairment of the structural tissue integrity. Multiparametric quantitative (q)MRI determines tissue parameters quantitatively, enabling the detection of microstructural processes related to tissue remodeling in aging and neurological diseases. In contrast to measuring tissue atrophy via structural imaging, multiparametric qMRI allows for investigating biologically distinct microstructural processes, which precede changes of the tissue volume. This facilitates a more comprehensive characterization of tissue alterations by revealing early impairment of the microstructural integrity and specific disease-related patterns. So far, qMRI techniques have been employed in a wide range of neurological diseases, including in particular conditions with inflammatory, cerebrovascular and neurodegenerative pathology. Numerous studies suggest that qMRI might add valuable information, including the detection of microstructural tissue damage in areas appearing normal on conventional MRI and unveiling the microstructural correlates of clinical manifestations. This review will give an overview of current qMRI techniques, the most relevant tissue parameters and potential applications in neurological diseases, such as early (differential) diagnosis, monitoring of disease progression, and evaluating effects of therapeutic interventions.
