Incentive-Based Lending Capacity, Competition and Regulation in Banking

Securitization and Lending Competition

We study the e¤ects of securitization on interbank lending competition when banks see private signals of local applicants’ repayment chances. If banks cannot securitize, the outcome is e¢ cient: they lend to their most creditworthy local applicants. With securitization, banks lend also to remote applicants with strong observables in order to lessen the lemons problem they face in selling their ...

Control and Competition: Banking Deregulation and Re-regulation in Indonesia

Policy changes in Indonesian banking from 1983 through 1990 saw the removal of controls on interest rates, lending, and expansion of branch networks, and of barriers to entry. The dismantling of loan subsidy programmes financed by the central bank ran in parallel with these changes. Private banks have been enabled to erode rapidly the market share of the previously dominant, but less efficient ...

Preliminary draft Competition and Regulation in European banking

Bank Competition and Risk-taking in the Iranian Banking Industry

Abstract: The banking industry is one of the main sectors of the economy of any country, that its health is a necessary condition to play a positive role in the economic development of that country. The health of the banking system is assessed by the financial stability criterion, which is evaluated by various risk-taking indexes. On the other hand, the banks risk-taking is affected by various...

Banking Consolidation and Small Business Lending

4 Non-technical summary 5 1 Motivation 7 2 The model setup 9 3 Solving the model 12 3.1 The utility Bellman equations 12 3.2 Solving the Bellman equations 13 3.3 The contract offered 14 3.3.1 The Frankfurt policy 16 3.3.2 The London policy 17 3.4 Constrained optimal contract 18 4 An extension: centralization vs. decentralization 19 4.1 Centralized bank 19 4.2 Decentralized bank 20 4.3 Small ban...