Finance and Financial Management Commons^™

Spain: Deposit Guarantee Fund Asset Management, Manuel León Hoyos

Journal of Financial Crises

The global oil shock in 1973-74 occurred at a time when Spain was embarking on a liberalization of its financial system that resulted in many new entrants, particularly small- and medium-sized institutions. The banking crisis that followed from 1977-85 affected 52 of the country’s 110 banks, most of them of small- and medium-sized, that comprised over 20% of bank deposits. Spain established the Deposit Guarantee Fund in November 1977 to provide limited deposit insurance, and, in March 1978, established a Banking Corporation to take control of and reorganize troubled banks. However, because the Banking Corporation lacked the legal authority to …

Broad-Based Asset Management Programs, Christian M. Mcnamara, Greg Feldberg, Mallory Dreyer, Andrew Metrick

Journal of Financial Crises

Dealing with high levels of nonperforming assets (NPAs) on bank balance sheets is one of the most challenging aspects of financial crisis management. High levels of NPAs can interfere with both bank profitability and general economic growth by increasing uncertainty about bank solvency and therefore funding costs, tying up resources and attention, and inhibiting new lending. One potential solution to the NPA problem is a centralized, government-driven effort to remove these assets from troubled institutions and then manage and sell them. Though such broad-based asset management (BBAM) programs existed even earlier in history, they appear to have become more common …

Lessons Learned: Robert Hoyt, Esq., Yasemin Esmen

Journal of Financial Crises

Robert Hoyt was General Counsel at the U.S. Department of Treasury between 2006 and 2009. He oversaw legal aspects of policies implemented to manage the crisis, including the rescues of Bear Stearns, AIG, and the U.S. Auto industry, the conservatorship of Fannie Mae and Freddie Mac, and the failure of Lehman Brothers, as well as the creation and implementation of the Troubled Asset Relief Program (TARP.) This Lessons Learned is based on a phone interview with Mr. Hoyt.

The Rescue Of American International Group Module F: The Aig Credit Facility Trust, Alec Buchholtz, Aidan Lawson

Journal of Financial Crises

In September 2008, American International Group, Inc. (AIG) experienced a liquidity crisis. To avoid the insurance giant’s bankruptcy, the Federal Reserve Bank of New York (FRBNY) extended an $85 billion emergency secured credit facility to AIG. In connection with the credit facility, AIG issued 100,000 shares of preferred stock, with voting rights equal to and convertible into 79.9% of the outstanding shares of AIG common stock, to an independent trust (the Trust) set up by the FRBNY. Three trustees held the stock for the sole benefit of the US Treasury, exercised the rights, powers, authorities, discretions, and duties of the …

Monetization Of Fiscal Deficits And Covid-19: A Primer, Aidan Lawson, Greg Feldberg

Journal of Financial Crises

Monetization—also known as “money-financed fiscal programs” or “money-printing”—occurs when a government finances itself by issuing currency or other non-interest-bearing liabilities, such as bank reserves. It poses real risks—potentially excessive inflation and encroachment on central-bank independence—and some paint it as a relic of a bygone era. The onset of the COVID-19 crisis, however, forced governments to spend heavily to combat the considerable economic and public health impacts. As government deficits climbed, monetization re-entered the conversation as a way to avoid the massive debt burdens that some nations may face. This paper describes how monetization works, provides key historical examples, and examines …

Lessons Learned: Edwin (Ted) Truman, Yasemin Sim Esmen

Journal of Financial Crises

Insights on fighting financial crises from Ted Truman, an expert in responding to the international dimensions of financial crises. Topics include the initial US response to the Global Financial Crisis of 2008-2009 and the utiltiy of issuing Special Drawing Rights (SDR).

Basel Iii F: Callable Commercial Paper, Christian M. Mcnamara, Rosalind Bennett, Andrew Metrick

Journal of Financial Crises

One of the Basel Committee on Banking Supervision’s responses to the global financial crisis of 2007-09 was to introduce the Liquidity Coverage Ratio (LCR), a short-term measure that evaluates whether a bank has enough liquidity to meet expected cash outflows during a 30-day stress scenario. One area in which this incentive has already resulted in changed practices is in the market for commercial paper. Banks often provide backup liquidity facilities to the issuers of commercial paper that the issuers can draw upon to repay a maturing issue of commercial paper if they are unable to sell a new issue to …

Basel Iii E: Synthetic Financing By Prime Brokers, Christian M. Mcnamara, Andrew Metrick

Journal of Financial Crises

Hedge funds rely on “prime brokerage” units within banks to provide leverage. With the enhanced capital requirements and new liquidity standards introduced by Basel III driving up the cost to banks of engaging in such financing, prime brokers have begun to offer an alternative means of providing hedge fund clients with leveraged exposure to securities. Known as synthetic financing, this alternative requires the prime broker to enter into derivatives contracts with the clients. Under the Basel III framework, the ability of banks to hedge and net such derivative positions results in capital and liquidity costs for synthetic financing that are …

Basel Iii D: Swiss Finish To Basel Iii, Christian M. Mcnamara, Natalia Tente, Andrew Metrick

Journal of Financial Crises

After the Basel Committee on Banking Supervision (BCBS) introduced the Basel III framework in 2010, individual countries confronted the question of how best to implement the framework given their unique circumstances. Switzerland, with a banking industry that is both heavily concentrated and very large relative to the size of its overall economy, faced a special challenge. It ultimately adopted what is sometimes referred to as the “Swiss Finish” to Basel III—enhanced requirements applicable to Switzerland’s “too-big-to-fail” banks Credit Suisse and UBS that go beyond the base requirements established by the BCBS. Yet the prominent role played by relatively new contingent …

Environmental Governance For Whom? Examining The Political, Institutional, Fiscal, And Legal Determinants Of State Environmental Agency Budget Policy In The Us, Andrew R. Duggan

Theses and Dissertations

Budgets are a prospective tool of governance, and appropriations are a planning vehicle reflecting: bureaucracies’ values, complex interactions, collective preferences, political influences, and available resources. Research spanning 30 years finds that environmental pollution is a key determinant of environmental budgets in the US, though myriad factors, actors, and subsystems are important to consider. Due to federalism and devolution of responsibilities and authorities, environmental governance falls largely to the states. While the dynamics that shape state environmental budget policy have received scholarly interest, theoretically-driven examinations of environmental appropriations remain limited within the public budgeting and environmental policy literature.

Using panel data …

Nonprofits’ Financial Health And Healthy People 2020 California Program Outcomes, Tammie Vanessa Johnson-Lozolla

Walden Dissertations and Doctoral Studies

Nonprofit organizations (NPOs) are essential for implementing U.S. health promotion policies such as the Healthy People 2020 Nutrition and Weight Status 9, 10.4, and 15.1 program goals. Obtaining and sustaining NPO funding are pervasive problems. Prior research has focused primarily on NPO financial measures without taking into consideration a conjoint assessment of program outcomes connected to their primary mission. This study examined the influence of financial, accountability, and transparency measures on a selection of California NPOs whose program goals focused on Healthy People 2020 nutritional outcomes. Using Mohr’s program theory lens, this quantitative study examined financial strategies and administrative components …

A Systematic Public Capital Management And Budgeting Process, Arwiphawee Srithongrung, Juita-Elena (Wie) Yusuf, Kenneth A. Kritz

School of Public Service Faculty Publications

This chapter introduces the readers to a public capital management and budgeting process and its role in generating public infrastructure networks. The main purpose of the chapter is to describe the normative public capital management and budgeting practices that are recommended by the public finance literature. These normative practices are segregated into four main components: (1) long-term capital planning, (2) capital budgeting and financial management, (3) capital project execution and project management, and (4) infrastructure maintenance. Given that the literature recommends specific practices to maximize efficiency in public capital spending, the four main components, combined, are referred to as the …

Summary, Initial Observations, And Getting To A Tentative Theory Of Public Investment Behavior, Arwiphawee Srithongrung, Juita-Elena (Wie) Yusuf

School of Public Service Faculty Publications

This chapter evaluates the 12 countries' capital management practices according to the systematic public capital management and budgeting process described in Chapter 1. The chapter characterizes and classifies the management practices of the twelve countries based on the authors' evaluation using the case study descriptions. The authors offer some initial observations based on comparisons across the case study countries and analysis of relationships between capital management and budgeting practices and political, economic, and public sector variables. The chapter proposes a tentative theory of public investment behavior and offers five propositions regarding the factors driving different practices across the case study …

Small Service Business Strategies To Win Open Federal Competitive Contracts, Mark Anthony Mitchell

Walden Dissertations and Doctoral Studies

Despite policies for U.S. federal agencies to use open competitive procedures that increase small business participation in federal contracting, some small businesses do not win open competitive federal contracts. The purpose of this multiple case study was to explore the strategies some leaders of small businesses in the service industry have used to win open competitive U.S. federal contracts. The conceptual framework for this study was agency theory. The participants in this study were 6 leaders of small businesses in the state of Washington who successfully implemented strategies to win open competitive U.S. federal contracts. Data were collected through face-to-face, …

Regulatory Effects On Traditional Financial Systems Versus Blockchain And Emerging Financial Systems, Samuel Edwin Addo Baidoo

Walden Dissertations and Doctoral Studies

The expansion of the Internet led to disruptive business and consumer processes, as existing regulations do not cover the scope and scale of emerging financial technologies. Using organization economic theory as the foundation, the purpose of this correlational study was to examine and compare the financial regulatory impact on traditional and emerging financial systems across a variety of factors including organizational type, predicted users, operational concerns, reasons for cost increases, and changes in business practices as a result of the regulatory environment. Data were collected through a survey of 227 adult Americans who engage in the financial sector and are …

Incorporating Stakeholder Input Into Financial Decision Making In California School Districts, Leann R. Nowlin

Walden Dissertations and Doctoral Studies

As of June 2013, all California public school districts are required to incorporate stakeholder input into their operational goals and expenditures to increase stakeholder trust. Trust is a belief by one party in a transaction that the other party in the transaction will act in a way that is fair and in the interest of both parties. The problem is that no guidance or direction relative to the methods or extent to which stakeholder input should be gathered and incorporated was provided within the new regulations. Lawmakers and stakeholders had no insight into the effectiveness or level of school district …

The Determinants Of Traffic Citation Revenues On Florida's Clerks Of Court And Comptrollers, Corey A. Hamilton

Walden Dissertations and Doctoral Studies

In the wake of budgetary restraints, many local government organizations are examining existing sources of revenue to exhaust available streams without increasing constituents' financial burden. Some of these revenue streams include nontraditional sources, such as traffic citations, yet little research has explored the implications of revenue generated from fines from traffic citations. Using the theory of resource dependence as the foundation, the purpose of this study was to explore the relationship between the estimated population of the county, the unemployment rate of the county, and the personal income per capita against the number of traffic citations issued and the Florida …

Cyclical Economic Impacts On Aggregated Fiscal Imbalance Levels In The United States, Douglas Arthur Merriman

Walden Dissertations and Doctoral Studies

Cyclical Economic Impacts on Aggregated Fiscal Imbalance Levels in the United States

by

Douglas A. Merriman

MSM, University of Maryland University College, 2004

BS, Central Washington University, 1983

Dissertation Submitted in Partial Fulfillment

of the Requirements for the Degree of

Doctor of Philosophy

Applied Management and Decision Science

Walden University

July 2015

The impacts of cyclical economic volatility on state-level fiscal imbalance levels have gained attention, given that beginning in late 2007, the United States experienced the deepest and longest-lasting recession in its history. The problem addressed by this study was whether there was a statistically significant relationship between certain …

Payroll Fraud: Effects Of Ghost Names On The Government Wage Bill In Ghana, Gilbert Nyaledzigbor

Walden Dissertations and Doctoral Studies

Policy makers believe that there are ghost workers, persons who do not work yet receive salaries, on Ghana's public sector payroll. However, little is known about the factors that create opportunities for ghost workers. The purpose of this quasi-experimental study was to extend Cressy's conceptualization of the fraud triangle theory to test the applicability of Reinikka and Svennson's graft estimation model by using nonprobability quota sampling to select 85 heads of public agencies for participation in a cross-sectional survey. The research questions focused on the relationship between size of government agency, the estimated number of opportunities for ghost workers, and …

International City/County Management Association 1999 Revenue Estimation Survey Revisited, Benjamin Bond

UNLV Theses, Dissertations, Professional Papers, and Capstones

In 1899 the National Municipal League declared that it was the duty of the Mayor to submit to the Council the annual budget of current expenses of the city, for almost as long, the budgeting process has been researched (Hou, 2006). Researching budgets is important and needed but comparatively little attention has been paid to revenue forecasts or to those responsible for the generation of revenue forecasts. Professional public administrators responsible for generating revenue forecasts have largely been overlooked in research. Judging by the lack of scholarly material available in academic journals, it appears the political process in which budget …

Corporate Social Responsibility In The Nigerian Banking Sector, Cecily Joy Adeleke

Walden Dissertations and Doctoral Studies

Corporate social responsibility is presently defined by the World Business Council of Sustainable Development as persistent commitment by businesses to behave ethically and contribute to economic development while also increasing the quality of life of employees, their families, and the community. Guided by Freeman's stakeholder theory, this study examined the relationship between corporate social responsibility and the Nigerian bankers' reported satisfaction with the Nigerian banking sector. Survey data were collected from a convenience sample of 99 Nigerian bankers, including branch managers, zonal managers, tellers, marketers, and investors. A single-stage sampling procedure was used to elicit their satisfaction with the Nigerian …

Three Essays On Local Government Debt, Robert Greer

Theses and Dissertations--Public Policy and Administration

The local government tax-exempt debt market is a growing, and complex, sector of public finance. As local governments turn to debt financing the factors that contribute to interest costs of that debt have become important considerations for local government officials and politicians. Governance at the local level involves a network of overlapping governments some of which share a tax base. This system of overlapping governments that share a tax base are subject to externalities that arise from taxation, expenditures, and debt. These externalities are usually analyzed in terms of tax or expenditure reactions, but there are implications for local government …

Changing And/Or Funding Opeb Promises: A Typology Of Local Government Responses To Gasb 45 And The Realization Of Opeb Liabilities, Juita-Elena Yusuf, Thomas Musumeci

School of Public Service Faculty Publications

GASB Statement No. 45 addresses how governmental units account for employees' other post-employment benefits (OPEB), requiring government employers to replace OPEB reporting on a pay-as-you-go basis with an accounting of the cost of current and future benefits. This requirement and the resulting OPEB liability may prompt government employers to reconsider key questions regarding their OPEB provision. The size of the OPEB liability depends on both the benefit promises made to employees and the assets to fund these promises. We propose a typology that defines four approaches for governments to respond to GASB 45 and their OPEB liabilities. These approaches represent …

U.S. State Employee Pension Systems: An Investigation Into The Causes Of Unfunded Liabilities, Chuck Truesdell

MPA/MPP/MPFM Capstone Projects

Defined benefit retirement plans for state employees have come under fire, both financially and politically, following recent market volatility and subsequent losses in pension investments. Asset losses matched with liabilities that are set years in advance translate to pressures on state policymakers and plan administrators to either find ways to improve the finances of these pension systems or transition to defined contribution plans that put the financial risk on individual employees rather than the state government. Because most states are legally and contractually obligated to pay retiree benefits regardless of the pension system’s financial condition — even to the point …

Credit Default Swaps Regulation And The Use Of Collateralized Mortgage Obligations In U.S. Financial Institutions, Jon Patraic Neill

Walden Dissertations and Doctoral Studies

The fast and easy global movement of capital throughout the financial system, from lenders to borrowers and through intermediaries and financial market participants, has been recognized as a source of instability associated with illiquidity and financial crises. The purpose of this research was to better understand how regulation either enables or constrains capital movement. The theoretical framework comprised 2 contrasting public policymaking models, Arrow's rational-comprehensive model and Kingdon's garbage can model, which were used to derive opposing hypotheses. The research question addressed the nature of the relationship between Credit Default Swaps (CDSs) regulations and the flow of capital into Collateralized …

Preventing State Budget Crises: Managing The Fiscal Volatility Problem, David Gamage

Articles by Maurer Faculty

Forty-nine of the U.S. states have balanced budget requirements, and every state acts as though bound by such constraints. These constraints create fiscal volatility - the states must either cut spending or raise taxes during economic downturns, while doing the opposite during upturns. This paper discusses how states should cope with fiscal volatility on both the levels of ordinary politics and of institutional-design policy. On the level of ordinary politics, the paper applies principles of risk allocation theory to conclude that states should primarily adjust the rates of broad-based taxes as their economies cycle, rather than fluctuating public spending. States …

Growth And Stability Of Local Government Taxes: An Analysis Of The Lexington-Fayette Urban County Government’S Tax Revenue Portfolio, Nathan Phelps

MPA/MPP/MPFM Capstone Projects

Adequate tax revenues are critical for a government to operate and maintain the delivery of services that its citizens depend. The stability of these revenues is necessary for a government to accurately forecast future revenue growth and to ensure that balanced-budget requirements are met. The Lexington-Fayette Urban County Government (LFUCG) depends upon five primary tax sources for nearly 95% of its tax revenue. These taxes comprise the city’s tax revenue portfolio and include the business net profits tax, employee withholdings tax, franchise tax, insurance premiums tax, and the property tax. Each of tax possesses unique characteristics that dictate their susceptibility …

Boulder City, Nevada Revenue Generating Analysis, Mayra A. Castro, Dolores P. Leyva, Arnetta M. Meagher, Wade Zimmerman

UNLV Theses, Dissertations, Professional Papers, and Capstones

Boulder City (City) is unique in the State of Nevada as being a non-gaming city, maintaining a controlled growth ordinance, and steadfastly holding to its “small town” values and character. The City has been facing budgetary challenges as future expenditures are anticipated to continually exceed revenues if current services levels are maintained. Indeed, fiscal reviews indicate the City has been transferring contingency monies between funds to cover overages for the past several fiscal years. This “robbing Peter to pay Paul” methodology may offer a temporary solution to the shortage but may be detrimental as a long term solution.

Clark County School District: Bonds And Debt. Can They Be Divided Equally?, Jocelyn Izumigawa

UNLV Theses, Dissertations, Professional Papers, and Capstones

Clark County School District is one of the largest school districts in the nation with a student population of 203,616 for 1998-1999. Talk of deconsolidating Clark County School District has been proposed by Assembly persons. However, as recent as November 2000, another initiative for deconsolidation and reconfigurations had not been approved by the voters. One of the issues surrounding deconsolidation is the district's bond debt. An equitable division has not been reached should Clark County School District deconsolidate. This paper deals with dividing the bond debt equally among eight districts (identified in an earlier study of deconsolidation) and assessing whether …

Public Finance Of Professional Athletic Facilities: Case Studies In Stadium And Arena Finance, Larry Harala

UNLV Theses, Dissertations, Professional Papers, and Capstones

During the course of the 1990s cities across the country opted to expend public monies at record levels on stadium and arena construction. The focus of this paper will be an examination of whether or not spending public money on private athletic facilities is justifiable. For the purpose of this paper “justifiable” will mean; that the overall economic benefit to the community can be clearly and quantifiably demonstrate to have a net positive economic impact on the community while benefiting all socio-economic elements of the community at large. The types of facilities that this paper will examine are arenas and …