Revitalizing Securitization for Small and Medium-Sized Enterprises in Europe
Revitalizing Securitization for Small and Medium-Sized Enterprises in Europe

Author: Mr.Shekhar Aiyar

Publisher: International Monetary Fund

Published: 2015-05-01

Total Pages: 35

ISBN-13: 1484335236

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Small and medium-sized enterprises (SMEs) account for a disproportionate share of output and employment in Europe but are still highly dependent on bank finance, which dried up or became prohibitively expensive during the crisis. Broader access to alternative, long-term finance through securitization would limit their exposure to banking sector difficulties and thus help revive credit. The SDN examines the various impediments to the development of a well-functioning and liquid securitization market in Europe and proposes a comprehensive multi-faceted strategy to support its development through regulatory reforms and infrastructure development together with targeted and time-bound official sector support. This would require (i) greater regulatory differentiation between securities of different quality and underlying asset structures; (ii) harmonized national enforcement and insolvency frameworks and standardized reporting requirements; and (iii) greater capacity of EU authorities to support new issuance. These measures would be underpinned by a pan-European definition of high-quality securitization (HQS) comprising simple, transparent and efficient asset structures receiving preferential regulatory treatment.

Revitalizing Securitization for Small and Medium-sized Enterprises in Europe
Revitalizing Securitization for Small and Medium-sized Enterprises in Europe

Author: Shekhar Aiyar

Publisher:

Published: 2015

Total Pages: 35

ISBN-13: 9781484334836

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Small and medium-sized enterprises (SMEs) account for a disproportionate share of output and employment in Europe but are still highly dependent on bank finance, which dried up or became prohibitively expensive during the crisis. Broader access to alternative, long-term finance through securitization would limit their exposure to banking sector difficulties and thus help revive credit. The SDN examines the various impediments to the development of a well-functioning and liquid securitization market in Europe and proposes a comprehensive multi-faceted strategy to support its development through regulatory reforms and infrastructure development together with targeted and time-bound official sector support. This would require (i) greater regulatory differentiation between securities of different quality and underlying asset structures; (ii) harmonized national enforcement and insolvency frameworks and standardized reporting requirements; and (iii) greater capacity of EU authorities to support new issuance. These measures would be underpinned by a pan-European definition of high-quality securitization (HQS) comprising simple, transparent and efficient asset structures receiving preferential regulatory treatment.

The Handbook of Global Shadow Banking, Volume II
The Handbook of Global Shadow Banking, Volume II

Author: Luc Nijs

Publisher: Springer Nature

Published: 2020-06-30

Total Pages: 759

ISBN-13: 3030348172

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This global handbook provides an up-to-date and comprehensive overview of shadow banking, or market-based finance as it has been recently coined. Engaging in financial intermediary services outside of normal regulatory parameters, the shadow banking sector was arguably a critical factor in causing the 2007-2009 financial crisis. This second volume explores three particular domains of shadow banking. The first domain deals with the macro-economic fundamentals of the respective shadow banking segments: Why do they exist, what problems do they solve and why are some of their embedded risks so persistent? The second domain captures the global dimensions of shadow banking markets, reviewing the particularities and specifics of various shadow banking systems around the world. Volume II concludes with an extensive overview of how the sector has changed since the financial crisis, focusing on regulatory arbitrage, contract imperfection and governance. Closing on unresolved issues and open-ended questions that will no doubt remain prominent in the shadow banking sector for years to come, this handbook is a must-read for professionals and policy-makers within the banking sector, as well as those researching economics and finance.

IMF Research Bulletin, June 2015
IMF Research Bulletin, June 2015

Author: International Monetary Fund. Research Dept.

Publisher: International Monetary Fund

Published: 2015-06-18

Total Pages: 15

ISBN-13: 151350004X

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In the June 2015 issue, the Research Summaries review "Migration: An Attractive Insurance Option in African Countries" (Ahmat Jidoud) and "Investment in Emerging Markets" (Nicolas E. Magud and Sebastian Sosa). The Q&A looks at "Seven Questions on Islamic Finance” (Inutu Lukonga). The Bulletin also includes its regular listings of recent IMF Working Papers and Staff Discussion Notes, as well as information on the "IMF Economic Review." A new IMF eLibrary discussion site on energy and climate change is highlighted, along with new recommendations from IMF Publications.

Securitization: Past, Present and Future
Securitization: Past, Present and Future

Author: Solomon Y Deku

Publisher: Springer

Published: 2017-08-04

Total Pages: 186

ISBN-13: 3319601288

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This book aims to explore if and how securitization changed financial intermediation and lending behaviour by reviewing the pre- and post-financial crisis theoretical and empirical literature. The book’s distinctive feature is bringing the growing post-crisis empirical evidence to the attention of a wider audience by critically appraising it against pre-crisis arguments. With its thought-provoking insights, this book is of particular interest for students, practitioners and academics.

Finance and Investment
Finance and Investment

Author: Colin P. Mayer

Publisher: Oxford University Press

Published: 2018

Total Pages: 425

ISBN-13: 0198815816

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Low growth, low investment, insufficient spend on infrastructure, weak bank lending to the corporate sector, and funding deficiencies of small and medium-sized enterprises are all causes of concern in Europe. To many, they point to fundamental problems in the financing of European companies and in Europe's financial systems. Are these concerns valid and do the structure and performance of the financial system lie at their heart? If so, what should be done to address them, and have the right policy prescriptions been identified to date? A product of the Restarting European Investment Finance research programme, Finance and Investment: The European Case brings together leading researchers to consider the causes of the persistently low level of investment in Europe. It examines the extent to which the financial system is a contributory factor and identifies possible remedies, considering the relation of finance to corporate sector investment, the lending behaviour of banks, the provision of equity financing, and the role of public sector institutions, regulation, and taxation. Finance and Investment provides one of the most comprehensive and thorough analyses of any financial system undertaken to date. It reflects a large body of research using new and existing data sets, employing advanced empirical tools, and exploiting the unique insights provided by the tumultuous events of financial and sovereign debt crises. Together, they comprise an exceptional body of knowledge to advance academic thinking and guide policy formulation.

Innovative Experiences in Access to Finance
Innovative Experiences in Access to Finance

Author: Augusto de la Torre

Publisher: World Bank Publications

Published: 2017-06-23

Total Pages: 484

ISBN-13: 0821376896

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Interest in access to finance and awareness of its importance have increased significantly since the early 2000s. Growing evidence suggests that lack of access to credit prevents many households and firms from financing high-return investment projects, which has an adverse effect on growth and poverty alleviation. Despite the increasing awareness of the importance of access to finance among both researchers and policymakers, there are still some major gaps in our understanding of the main drivers of access, as well as about the impact of different policies in this area. This book aims to fill some of these gaps by discussing recent innovative experiences in broadening access to credit in Latin America. These experiences are consistent with an emerging new view that, while recognizing the central role of the public sector in improving the contractual and informational environment for financial markets, also contends that there might be room for well-designed, restricted interventions in collaboration with the private sector to foster the development of financial markets and broaden access to them. In particular, the book analyzes, among other things, some interesting experiences from Brazil, Chile, Colombia, and Mexico that use different instruments to broaden access to credit in a sustainable way, such as structured finance, factoring, credit guarantees, and correspondent banking. Most of these experiences have led to financial innovation by developing new financial products and coordinating different players in the financial and real sectors to overcome barriers to access to credit. The book provides a first systematic analysis of these innovative experiences, including an analytical framework to understand problems of access to finance and a discussion of the effects and optimal design of public interventions. Finally, the book discusses some open policy questions about the role of the private and public sectors (including state†?owned banks) in broadening access to finance in a sustainable and market-friendly manner.

A Capital Market Union for Europe
A Capital Market Union for Europe

Author: Mr.Ashok Vir Bhatia

Publisher: International Monetary Fund

Published: 2019-09-10

Total Pages: 30

ISBN-13: 1513513699

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This note weighs the merits of a capital market union (CMU) for Europe, identifies major obstacles in its path, and recommends a set of carefully targeted policy actions. European capital markets are relatively small, resulting in strong bank-dependence, and are split sharply along national lines. Results include an uneven playing field in terms of corporate funding costs, the rationing out of collateral-constrained firms, and limited shock absorption. The benefits of integration center on expanding financial choice, ultimately to support capital formation and resilience. Capital market development and integration would support a healthy diversity in European finance. Proceeding methodically, the note identifies three key barriers to greater capital market integration in Europe: transparency, regulatory quality, and insolvency practices. Based on these findings, the note urges three policy priorities, focused on the three barriers. There is no roadblock—such steps should prove feasible without a new grand bargain.

Euro Area Policies
Euro Area Policies

Author: International Monetary Fund. European Dept.

Publisher: International Monetary Fund

Published: 2015-07-27

Total Pages: 56

ISBN-13: 1513557114

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Context. The recovery is strengthening, underpinned by lower oil prices and the ECB’s expanded asset purchase program. But the medium-term outlook remains weak, weighed down by the legacies of insufficient demand, lagging productivity, and weak bank and corporate balance sheets. Policies. A concerted, collective effort is needed to sustain the recovery, avoid overburdening monetary policy, and lift potential growth over the medium term, which would have positive spillovers for the rest of the world: Demand support. Quantitative easing (QE) has boosted confidence and improved financial conditions. The ECB’s clear communication to stay the course on QE until inflation is on a sustained adjustment path will help anchor expectations. Countries should adhere to the SGP, but those with fiscal space should use it to support investment and structural reforms. Balance sheet repair. High non-performing loans (NPLs) in some banks are eroding profitability and discouraging new lending. Complementary policies are needed to incentivize NPL resolution through strengthened prudential supervision, insolvency reforms, and development of distressed debt markets. Asset management companies (AMCs) could help banks to offload NPLs and assist with corporate restructuring. Productivity-enhancing structural reforms. Labor and product market reforms should be combined with faster implementation of the Services Directive, further improvements of insolvency regimes, and a greater push toward a single market in capital, transport, energy, and the digital economy. A capital markets union would help diversify funding sources and reduce reliance on bank lending. Better economic governance. A more effective and simpler governance framework, including a move towards "outcome-based" benchmarking, could help advance structural reforms, while the fiscal framework could be simplified and strengthened.

Securitization and Credit Quality
Securitization and Credit Quality

Author: David Marques-Ibanez

Publisher: International Monetary Fund

Published: 2016-11-15

Total Pages: 41

ISBN-13: 1475554001

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Banks are usually better informed on the loans they originate than other financial intermediaries. As a result, securitized loans might be of lower credit quality than otherwise similar nonsecuritized loans. We assess the effect of securitization activity on loans’ relative credit quality employing a uniquely detailed dataset from the euro-denominated syndicated loan market. We find that, at issuance, banks do not seem to select and securitize loans of lower credit quality. Following securitization, however, the credit quality of borrowers whose loans are securitized deteriorates by more than those in the control group. We find tentative evidence suggesting that poorer performance by securitized loans might be linked to banks’ reduced monitoring incentives.