Given a C1,1–function f : U → R (where U ⊂ Rn open) we deal with the question of whether or not at a given point x0 ∈ U there exists a local minorant φ of f of class C2 that satisfies φ(x0) = f(x0), Dφ(x0) = Df(x0) and Dφ(x0) ∈ Hf(x0) (the generalized Hessian of f at x0). This question is motivated by the second-order viscosity theory of the PDE, since for nonsmooth functions, an analogous resu...

The classical Schläfli formula, and its “higher” analogs given in [SS03], are relations between the variations of the volumes and “curvatures” of faces of different dimensions of a polyhedra (which can be Euclidean, spherical or hyperbolic) under a first-order deformation. We describe here analogs of those formulas which are vector-valued rather than scalar. Some consequences follow, for instan...

Solvency is a primary concern for regulators of insurance companies, claims paying ability is a primary concern for policyholders, and return on investment is a primary concern for investors. These interests potentially conflict, and the decision-makers for the firm must trade off one concern versus another. Here we examine the efficiency of insurance companies via data envelopment analysis usi...

In this paper, we explore whether markets can create endogenously good collateral in a crisis by analyzing a simple model where a country-specific catastrophic shock is shared between two countries in the presence of solvency constraints. In this model, due to severe solvency constraints, realized catastrophic shocks cannot be covered fully by ex ante arrangements. However, most uninsured shock...

Prof.T.Velnampy Dean, Faculty of Management Studies and Commerce, University of Jaffna. Abstract This study examines the performance of Dialog Axiata PLC and Sri Lanka Telecom PLC by employing both cash flow ratios and traditional financial ratios over the past five years. Using the financial statements from Colombo Stock Exchange (CSE) website, independent sample t-tests were used for the anal...

The underlying stochastic nature of the requirements for the Solvency II regulations has introduced significant challenges if the required calculations are to be performed correctly, without resorting to excessive approximations, within practical timescales. It is generally acknowledged by actuaries within UK life offices that it is currently impossible to correctly fulfil the requirements impo...

We develop a theory of how agency conflicts between the shareholders and debt holders of a financial institution, accounting measurement rules, and prudential capital regulation interact to affect the institution’s capital structure and project choices. We show that, relative to a benchmark historical cost regime in which assets and liabilities on the institution’s balance sheet are measured at...

Granting credits to commercial customers is one of the central activities of a bank. Avoiding incorrect credit decisions and minimizing the required effort are crucial factors for the economic success of a bank. The basic task of credit granting is a correct valuation of the customer, which includes the analysis of his(her) annual account and the estimations of the customer's solvency. The bank...