Too-Big-to-Fail in Banking (eBook)

Impact of G-SIB Designation and Regulation on Relative Equity Valuations

Tom Filip Lesche (Autor)

eBook Download: PDF

2021 | 1st ed. 2021
XIX, 248 Seiten
Springer Fachmedien Wiesbaden (Verlag)
978-3-658-34182-4 (ISBN)

Infos

This book provides a comprehensive summary of the latest academic research on the important topic of too-big-to-fail (TBTF) in banking. It explains TBTF from various perspectives including the range of regulatory measures proposed to counter TBTF, most notably the globally accepted regulation of global-systemically important banks (G-SIBs) and its main tool of capital surcharges. The empirical analysis quantifies the shareholder value of the G-SIB attribution by using quarterly observations from more than 750 global banks between Q2 2008 and Q3 2015. The main finding is that G-SIBs are confronted with a substantial relative valuation discount compared to non-G-SIBs. From the end of 2011 until the end of 2015, a stable discount of 0.6x-0.8x price-to-tangible common equity (P/TCE) is statistically highly significant. The results suggest that the G-SIB designation effect, which positively impacts G-SIBs' share prices because of funding benefits from IGGs, is dominated by the regulatory G-SIB burden effect, which negatively impacts G-SIBs' share prices because of lower profitability due to capital surcharges and other regulatory requirements placed on G-SIBs. The findings re-open the debate about whether breaking up G-SIBs would unlock shareholder value and whether G-SIBs are regulated efficiently.

Dr. Tom Filip Lesche is a venture capitalist investing into financial technology companies. Previously he was an investment banker advising financial institutions on capital markets and M&A transactions.

Produkt-Details

• Erscheint lt. Verlag: 28.6.2021
• Reihe/Serie: Finanzwirtschaft, Banken und Bankmanagement I Finance, Banks and Bank Management
• Reihe/Serie: Finanzwirtschaft, Banken und Bankmanagement I Finance, Banks and Bank Management
• Zusatzinfo: XIX, 248 p. 36 illus.
• Sprache: englisch
• Themenwelt: Wirtschaft ► Betriebswirtschaft / Management ► Finanzierung
• Themenwelt: Betriebswirtschaft / Management ► Spezielle Betriebswirtschaftslehre ► Bankbetriebslehre
• Schlagworte: Banks • Global Systemically Important Bank • Price-to-Book Value Ratio • Regulation • Too-Big-To-Fail • Valuation
• ISBN-10: 3-658-34182-3 / 3658341823
• ISBN-13: 978-3-658-34182-4 / 9783658341824