scholarly journals The impact of Basel III on trade finance: the potential unintended consequences of the leverage ratio

2018 ◽  
Vol 20 (2) ◽  
pp. 115-123 ◽  
Author(s):  
Marc Auboin ◽  
Isabella Blengini
Keyword(s):  
Unintended Consequences ◽  
Basel Iii ◽  
Trade Finance ◽  
Leverage Ratio ◽  
The Impact

Credit Risk Measurement, Leverage Ratios, and Basel III

2017 ◽  
pp. 86-116
Keyword(s):  
United States ◽  
The United States ◽  
Basel Iii ◽  
Holding Companies ◽  
Leverage Ratio ◽  
Basel Committee ◽  
Legislative Changes ◽  
Credit Risk Measurement ◽  
The Impact ◽  
The U.S

The Basel III Leverage Ratio, as originally agreed upon in December 2010, has recently undergone revisions and updates – both in relation to those proposed by the Basel Committee on Banking Supervision – as well as proposals introduced in the United States. Whilst recent proposals have been introduced by the Basel Committee to improve, particularly, the denominator component of the Leverage Ratio, new requirements have been introduced in the U.S to upgrade and increase these ratios, and it is those updates which relate to the Basel III Supplementary Leverage Ratio that have primarily generated a lot of interests. This is attributed not only to concerns that many subsidiaries of US Bank Holding Companies (BHCs) will find it cumbersome to meet such requirements, but also to potential or possible increases in regulatory capital arbitrage: a phenomenon which plagued the era of the original 1988 Basel Capital Accord and which also partially provided impetus for the introduction of Basel II. This paper is aimed at providing an analysis of the recent updates which have taken place in respect of the Basel III Leverage Ratio and the Basel III Supplementary Leverage Ratio – both in respect of recent amendments introduced by the Basel Committee and proposals introduced in the United States. As well as highlighting and addressing gaps which exist in the literature relating to liquidity risks, corporate governance and information asymmetries, by way of reference to pre-dominant based dispersed ownership systems and structures, as well as concentrated ownership systems and structures, this paper will also consider the consequences – as well as the impact - which the U.S Leverage ratios could have on Basel III. There are ongoing debates in relation to revision by the Basel Committee, as well as the most recent U.S proposals to update Basel III Leverage ratios and whilst these revisions have been welcomed to a large extent, in view of the need to address Tier One capital requirements and exposure criteria, there is every likelihood, indication, as well as tendency that many global systemically important banks (GSIBS), and particularly their subsidiaries, will resort to capital arbitrage. What is likely to be the impact of the recent proposals in the U.S.? The recent U.S proposals are certainly very encouraging and should also serve as impetus for other jurisdictions to adopt a pro-active approach – particularly where existing ratios or standards appear to be inadequate. This paper also adopts the approach of evaluating the causes and consequences of the most recent updates by the Basel Committee, as well as those revisions which have taken place in the U.S, by attempting to balance the merits of the respective legislative updates and proposals. The value of adopting leverage ratios as a supplementary regulatory tool will also be illustrated by way of reference to the impact of the recent legislative changes on risk taking activities, as well as the need to also supplement capital adequacy requirements with the Basel Leverage ratios and the Basel liquidity standards.

Aviation and the Microbiome

2020 ◽  
Vol 91 (8) ◽  
pp. 651-661
Author(s):  
Joshua T. Davis ◽  
Hilary A. Uyhelji
Keyword(s):  
Psychological Health ◽  
Aviation Safety ◽  
Autism Spectrum ◽  
Unintended Consequences ◽  
Microbial Colonization ◽  
Future Research ◽  
Aerospace Medicine ◽  
Medical Certification ◽  
Physical Disorders ◽  
The Impact

INTRODUCTION: Although the impact of microorganisms on their hosts has been investigated for decades, recent technological advances have permitted high-throughput studies of the collective microbial genomes colonizing a host or habitat, also known as the microbiome. This literature review presents an overview of microbiome research, with an emphasis on topics that have the potential for future applications to aviation safety. In humans, research is beginning to suggest relationships of the microbiome with physical disorders, including type 1 and type 2 diabetes mellitus, cardiovascular disease, and respiratory disease. The microbiome also has been associated with psychological health, including depression, anxiety, and the social complications that arise in autism spectrum disorders. Pharmaceuticals can alter microbiome diversity, and may lead to unintended consequences both short and long-term. As research strengthens understanding of the connections between the microbiota and human health, several potential applications for aerospace medicine and aviation safety emerge. For example, information derived from tests of the microbiota has potential future relevance for medical certification of pilots, accident investigation, and evaluation of fitness for duty in aerospace operations. Moreover, air travel may impact the microbiome of passengers and crew, including potential impacts on the spread of disease nationally and internationally. Construction, maintenance, and cleaning regimens that consider the potential for microbial colonization in airports and cabin environments may promote the health of travelers. Altogether, the mounting knowledge of microbiome effects on health presents several opportunities for future research into how and whether microbiome-based insights could be used to improve aviation safety.Davis JT, Uyhelji HA. Aviation and the microbiome. Aerosp Med Hum Perform. 2020; 91(8):651–661.

Role of Credit Rating in determining Capital structure: Evidence from Non-Financial sector of Pakistan

2020 ◽  
Vol 38 (3) ◽  
Author(s):  
Shoaib Ali ◽  
Imran Yousaf ◽  
Muhammad Naveed
Keyword(s):  
Capital Structure ◽  
Credit Rating ◽  
Least Square ◽  
Annual Data ◽  
Leverage Ratio ◽  
Financial Decisions ◽  
Financial Firms ◽  
High Level ◽  
The Impact ◽  
The Capital Structure

This paper aims to examine the impact of external credit ratings on the financial decisions of the firms in Pakistan.  This study uses the annual data of 70 non-financial firms for the period 2012-2018. It uses ordinary least square (OLS) to estimate the impact of credit rating on capital structure. The results show that rated firm has a high level of leverage. Moreover, Profitability and tanagability are also found to be a significantly negative determinant of the capital structure, whereas, size of the firm has a significant positive relationship with the capital structure of the firm.  Besides, there exists a non-linear relationship between the credit rating and the capital structure. The rated firms have higher leverage as compared to the non-rated firms. The high and low rated firms have a low level of leverage, while mid rated firms have a higher leverage ratio. The finding of the study have practical implications for the manager; they can have easier access to the financial market by just having a credit rating no matter high or low. Policymakers must stress upon the rating agencies to keep improving themselves as their rating severs as the measure to judge the creditworthiness of the firm by both the investors and management as well.

The Impact of the Leverage Ratio on Client Clearing

2018 ◽  
Author(s):  
Gerardo Ferrara ◽  
Jonathan Acosta Smith ◽  
Francesc Rodriguez Tous
Keyword(s):  
Leverage Ratio ◽  
The Impact

scholarly journals How Risky Is That Risk Sharing Agreement? Mean-Variance Tradeoffs and Unintended Consequences of Six Common Risk Sharing Agreements

2021 ◽  
Vol 6 (1) ◽  
pp. 238146832199040
Author(s):  
Gregory S. Zaric
Keyword(s):  
Risk Sharing ◽  
Financial Risk ◽  
Unintended Consequences ◽  
Drug Costs ◽  
New Drugs ◽  
Total Drug ◽  
Number Of Patients ◽  
Clinical Benefits ◽  
The Impact ◽  
Mean Variance

Background. Pharmaceutical risk sharing agreements (RSAs) are commonly used to manage uncertainties in costs and/or clinical benefits when new drugs are added to a formulary. However, existing mathematical models of RSAs ignore the impact of RSAs on clinical and financial risk. Methods. We develop a model in which the number of patients, total drug consumption per patient, and incremental health benefits per patient are uncertain at the time of the introduction of a new drug. We use the model to evaluate the impact of six common RSAs on total drug costs and total net monetary benefit (NMB). Results. We show that, relative to not having an RSA in place, each RSA reduces expected total drug costs and increases expected total NMB. Each RSA also improves two measures of risk by reducing the probability that total drug costs exceed any threshold and reducing the probability of obtaining negative NMB. However, the effects on variance in both NMB and total drug costs are mixed. In some cases, relative to not having an RSA in place, implementing an RSA can increase variability in total drug costs or total NMB. We also show that, for some RSAs, when their parameters are adjusted so that they have the same impact on expected total drug cost, they can be rank-ordered in terms of their impact on variance in drug costs. Conclusions. Although all RSAs reduce expected total drug costs and increase expected total NMB, some RSAs may actually have the undesirable effect of increasing risk. Payers and formulary managers should be aware of these mean-variance tradeoffs and the potentially unintended results of RSAs when designing and negotiating RSAs.

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