Financial stability - Bank of Canada
https://www.bankofcanada.ca/rss-feeds/
Bank of Canada RSS Feedsen2024-03-28T21:57:02+00:00Financial Transaction Taxes: International Experiences, Issues and Feasibility
https://www.bankofcanada.ca/wp-content/uploads/2012/11/boc-review-autumn12-pomeranets.pdf
The financial transaction tax (FTT) is a policy idea with a long history that, in the wake of the global financial crisis, has attracted renewed interest in some quarters. This article examines the evidence of the impact of an FTT on market quality and explores a few of the practical issues surrounding the implementation of an FTT. Proponents argue that an FTT will generate substantial tax revenues and reduce market volatility. The majority of the empirical evidence, however, supports the arguments of opponents of the tax who assert that an FTT reduces volume and liquidity and increases volatility. In addition, there are numerous challenges in implementing an FTT, which may reduce the intended revenues. Whether an FTT is beneficial hinges on its effect on market quality and its ability to raise revenues. However, there are many unanswered questions regarding its design.2012-11-15T07:52:31+00:00enFinancial Transaction Taxes: International Experiences, Issues and Feasibility2012-11-15When Lower Risk Increases Profit: Competition and Control of a Central Counterparty
https://www.bankofcanada.ca/2012/11/working-paper-2012-35/
We model the behavior of dealers in Over-the-Counter (OTC) derivatives markets where a small number of dealers trade with a continuum of heterogeneous clients (hedgers). Imperfect competition and (endogenous) default induce a familiar trade-off between competition and risk.2012-11-09T11:55:55+00:00enWhen Lower Risk Increases Profit: Competition and Control of a Central Counterparty2012-11-09Financial marketsFinancial stabilityFinancial system regulation and policiesWorking Paper 2012-35https://www.bankofcanada.ca/wp-content/uploads/2012/11/wp2012-35.pdfWhen Lower Risk Increases Profit: Competition and Control of a Central CounterpartyJean-Sébastien FontaineHéctor Pérez SaizJoshua SliveNovember 2012GG1G10G18Canadian Bank Balance-Sheet Management: Breakdown by Types of Canadian Financial Institutions
https://www.bankofcanada.ca/2012/09/discussion-paper-2012-7/
The authors document leverage, capital and liquidity ratios of banks in Canada. These ratios are important indicators of different types of risk with respect to a bank’s balance‐sheet management. Particular attention is given to the observations by different types of banks, including small banks that historically received less attention.2012-09-28T13:48:38+00:00enCanadian Bank Balance-Sheet Management: Breakdown by Types of Canadian Financial Institutions2012-09-28Financial institutionsFinancial stabilityFinancial system regulation and policiesDiscussion Paper 2012-7https://www.bankofcanada.ca/wp-content/uploads/2012/09/dp2012-07.pdfCanadian Bank Balance-Sheet Management: Breakdown by Types of Canadian Financial InstitutionsDavid Xiao ChenH. Evren DamarHani SoubraYaz TerajimaSeptember 2012GG2G21G28Does the Buck Stop Here? A Comparison of Withdrawals from Money Market Mutual Funds with Floating and Constant Share Prices
https://www.bankofcanada.ca/2012/08/working-paper-2012-25/
Recent reform proposals call for an elimination of the constant net asset value (NAV) or “buck” in money market mutual funds to reduce the occurrence of runs. Outside the United States, there are several countries that have money market mutual funds with and without constant NAVs.2012-08-27T10:00:33+00:00enDoes the Buck Stop Here? A Comparison of Withdrawals from Money Market Mutual Funds with Floating and Constant Share Prices2012-08-27Financial marketsFinancial stabilityMarket structure and pricingWorking Paper 2012-25https://www.bankofcanada.ca/wp-content/uploads/2012/08/wp2012-25.pdfDoes the Buck Stop Here? A Comparison of Withdrawals from Money Market Mutual Funds with Floating and Constant Share PricesJonathan WitmerAugust 2012FF3F30GG0G01G1G18G2G20An Analysis of Indicators of Balance-Sheet Risks at Canadian Financial Institutions
https://www.bankofcanada.ca/wp-content/uploads/2012/08/review-summer12-chen.pdf
This article examines four indicators of balance-sheet risks—leverage, capital, asset liquidity and funding—among different types of financial institutions in Canada over the past three decades. It also discusses relevant developments in the banking sector that could have contributed to the observed dynamics. The authors find that the various risk indicators decreased during the period for most of the non-Big Six financial institutions, but remained relatively unchanged for the Big Six banks. In addition, the balance-sheet risk indicators became more heterogeneous across financial institutions. The observed overall decline and increased heterogeneity follow certain regulatory changes, such as the introduction of the liquidity guidelines on funding in 1995 and the implementation of bank-specific leverage requirements in 2000. Given that these regulations required more balance-sheet risk management, they have likely contributed to the increased resilience of the banking sector.2012-08-16T08:39:22+00:00enAn Analysis of Indicators of Balance-Sheet Risks at Canadian Financial Institutions2012-08-16The Ex-Ante Versus Ex-Post Effect of Public Guarantees
https://www.bankofcanada.ca/2012/07/working-paper-2012-22/
In October 2006, Dominion Bond Rating Service (DBRS) introduced new ratings for banks that account for the potential of government support. The rating changes are not a reflection of any changes in the respective banks’ credit fundamentals.2012-07-27T12:18:19+00:00enThe Ex-Ante Versus Ex-Post Effect of Public Guarantees2012-07-27Financial institutionsFinancial stabilityFinancial system regulation and policiesWorking Paper 2012-22https://www.bankofcanada.ca/wp-content/uploads/2012/07/wp2012-22.pdfThe Ex-Ante Versus Ex-Post Effect of Public GuaranteesH. Evren DamarReint GroppAdi MordelJuly 2012GG2G21G28G3G32On the Existence and Fragility of Repo Markets
https://www.bankofcanada.ca/2012/06/working-paper-2012-17/
This paper presents a model of an over-the-counter bond market in which bond dealers and cash investors arrange repurchase agreements (repos) endogenously.2012-06-21T11:49:36+00:00enOn the Existence and Fragility of Repo Markets2012-06-21Financial marketsFinancial stabilityPayment clearing and settlement systemsWorking Paper 2012-17https://www.bankofcanada.ca/wp-content/uploads/2012/06/wp2012-17.pdfOn the Existence and Fragility of Repo MarketsHajime TomuraJune 2012GG2G24Inflation Targeting: The Recent International Experience
https://www.bankofcanada.ca/wp-content/uploads/2012/05/boc-review-spring12-lavigne.pdf
In the years since the 2006 renewal of Canada’s inflation-control agreement, monetary policy regimes have faced significant shocks, including the global economic and financial crisis. This article reviews the recent experience with inflation targeting, including the debate about the appropriate role of monetary policy in maintaining financial stability. In the aftermath of the crisis, both […]2012-05-17T10:22:01+00:00enInflation Targeting: The Recent International Experience2012-05-17Understanding Systemic Risk in the Banking Sector: A MacroFinancial Risk Assessment Framework
https://www.bankofcanada.ca/wp-content/uploads/2012/05/boc-review-spring12-gauthier.pdf
The MacroFinancial Risk Assessment Framework (MFRAF) models the interconnections between liquidity and solvency in a financial system, with multiple institutions linked through an interbank network. The MFRAF integrates funding liquidity risk as an endogenous outcome of the interactions between solvency risk and the liquidity profiles of banks, which is a complementary approach to the new […]2012-05-17T10:21:49+00:00enUnderstanding Systemic Risk in the Banking Sector: A MacroFinancial Risk Assessment Framework2012-05-17A Note on Central Counterparties in Repo Markets
https://www.bankofcanada.ca/2012/03/discussion-paper-2012-4/
The author introduces a central counterparty (CCP) into a model of a repo market. Without the CCP, there exist multiple equilibria in the model. In one of the equilibria, a repo market emerges as bond dealers and cash investors choose to arrange repos in an over-the-counter bond market.2012-03-09T09:49:54+00:00enA Note on Central Counterparties in Repo Markets2012-03-09Financial marketsFinancial stabilityPayment clearing and settlement systemsDicussion paper 2012-4https://www.bankofcanada.ca/wp-content/uploads/2012/03/dp2012-04.pdfA Note on Central Counterparties in Repo MarketsHajime TomuraMarch 2012GG2G24