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Full-Text Articles in Law

Ring-Fencing, Steven L. Schwarcz Jan 2013

Ring-Fencing, Steven L. Schwarcz

Faculty Scholarship

“Ring-fencing” is often touted as a regulatory solution to problems in banking, finance, public utilities, and insurance. However, both the precise meaning of ring-fencing, as well as the nature of the problems that ring-fencing regulation purports to solve, are ill defined. This article examines the functions and conceptual foundations of ring-fencing. In a regulatory context, the term can best be understood as legally deconstructing a firm in order to more optimally reallocate and reduce risk. So utilized, ring-fencing can help to protect public-benefit activities performed by private-sector firms, as well as to mitigate systemic risk and the too-big-to-fail problem inherent …


Revisiting Sovereign Bankruptcy, Lee C. Buchheit, Anna Gelpern, Mitu Gulati, Ugo Panizza, Beatrice Weder Di Mauro, Jeromin Zettelmeyer Jan 2013

Revisiting Sovereign Bankruptcy, Lee C. Buchheit, Anna Gelpern, Mitu Gulati, Ugo Panizza, Beatrice Weder Di Mauro, Jeromin Zettelmeyer

Faculty Scholarship

Sovereign debt crises occur regularly and often violently. Yet there is no legally and politically recognized procedure for restructuring the debt of bankrupt sovereigns. Procedures of this type have been periodically debated, but so far been rejected, for two main reasons. First, countries have been reluctant to give up power to supranational rules or institutions, and creditors and debtors have felt that there were sufficient instruments for addressing debt crises at hoc. Second, fears that making debt easier to restructure would raise the costs and reduce the amounts of sovereign borrowing in many countries. This was perceived to be against …


The Role Of The Imf In Future Sovereign Debt Restructurings: Report Of The Annenberg House Expert Group, Douglas G. Baird, Nicole Bollen, Lee C. Buchheit, Mitu Gulati, Anne O. Krueger, Fridrik Mar Balursson, Robert K. Rasmussen, David A. Skeel Jr., Sergei Storchak, Jeromin Settelmeyer Jan 2013

The Role Of The Imf In Future Sovereign Debt Restructurings: Report Of The Annenberg House Expert Group, Douglas G. Baird, Nicole Bollen, Lee C. Buchheit, Mitu Gulati, Anne O. Krueger, Fridrik Mar Balursson, Robert K. Rasmussen, David A. Skeel Jr., Sergei Storchak, Jeromin Settelmeyer

Faculty Scholarship

A meeting of international finance and insolvency experts was held on November 2, 2013 at the Annenberg House in Santa Monica, California. The meeting was co-hosted by the USC Law School and the Annenberg Retreat at Sunnylands. The goal was to solicit the views of experts on the implications of the IMF’s April 26, 2013 paper captioned “Sovereign Debt Restructuring -- Recent Developments and Implications for the Fund’s Legal and Policy Framework”. The April 26 paper may signal a shift in IMF policies in the area of sovereign debt workouts. Although the Expert Group discussed a number of the ideas …


Securitization, Structured Finance, And Covered Bonds, Steven L. Schwarcz Jan 2013

Securitization, Structured Finance, And Covered Bonds, Steven L. Schwarcz

Faculty Scholarship

No abstract provided.


Walking Back From Cyprus, Lee C. Buchheit, Mitu Gulati Jan 2013

Walking Back From Cyprus, Lee C. Buchheit, Mitu Gulati

Faculty Scholarship

Last Friday, the European leaders trespassed on consecrated ground by putting insured depositors in Cypriot banks in harm’s way. They had other options, none of them pleasant but some less ominous than the one they settled on.