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Full-Text Articles in Macroeconomics
Ireland And Iceland In Crisis C: Iceland’S Landsbanki Icesave, Arwin G. Zeissler, Thomas Piontek, Andrew Metrick
Ireland And Iceland In Crisis C: Iceland’S Landsbanki Icesave, Arwin G. Zeissler, Thomas Piontek, Andrew Metrick
Journal of Financial Crises
At year-end 2005, almost all of the total assets of Iceland’s banking system were concentrated in just three banks (Glitnir, Kaupthing, and Landsbanki). These banks were criticized by certain financial analysts in early 2006 for being overly dependent on wholesale funding, much of it short-term, that could easily disappear if creditors’ confidence in these banks faltered for any reason. Landsbanki, followed later by Kaupthing and then Glitnir, responded to this criticism and replaced part of their wholesale funding by using online accounts to gather deposits from individuals across Europe. In Landsbanki’s case, these new deposits were marketed under the name …
The ‘Security Pacific Letter’: Estimating The Causal Effect Of Securitization On Banks’ Systemic Exposure, Paul-Angelo Dell'isola
The ‘Security Pacific Letter’: Estimating The Causal Effect Of Securitization On Banks’ Systemic Exposure, Paul-Angelo Dell'isola
Dartmouth Undergraduate Journal of Politics, Economics and World Affairs
This paper aims to test the hypothesis of the ‘Safe Asset narrative’
which states that banks became manufacturers of pseudo safe assets to meet
a global shortage of safe assets in the pre-crisis period. In this narrative,
securitization is the mechanism which enables banks to become underwriters
of safe assets. This paper takes this hypothesis to the data and attempts to
estimate the causal effect of securitization on banks’ systemic exposure. In
particular, this paper exploits a regulatory change that occurred in 1987 when
the OCC expanded the scope of assets US national banks could securitize. By
using state-chartered banks …