Bad incentives or weak controls?

Author(s):

Gilad Livne

Industry:
Banking

The recent loss of £1.5 billion at UBS as a result of allegedly unauthorised trading raises the question as to the possible causes of this failure. Is this attributable to wrong pay incentives, failure of supervision and internal control, or is it a result of corporate culture?

Dr Gilad Livne, Senior Lecturer in Accounting and Finance, explains further based on his latest research.

Updated: 10/02/2017
Comments:
Views: 13,617

Competition and dynamics of takeover contests

Author(s):

Sonia Falconieri

Topic:
Finance
Industry:
Banking

This paper investigates the impact of competition on the outcomes of takeovers. The researchers use a bargaining model with alternating offers where calling an auction represents an outside option for each bidder at each stage of the game.

The model aims then to answer three main questions: who wins the takeover? When? How?

Updated: 01/01/2015
Comments: 6
Views: 6,619

Supervisory effectiveness and bank risk

Author(s):

Manthos Delis

 et al.

The banking crisis that began in 2007 led to many questions about the banking sector and the risks taken by those within the industry.

Inspired by past research from Jackson (2007), Jackson and Roe (2009) and Coffee (2007), the focus of this paper is on the role of banking supervision in controlling bank risk.

Does effective supervision rather than the mere adoption of regulation hold the key in deterring excessive bank risk? Read the full report to find out more.

Updated: 28/12/2014
Comments: 24
Views: 6,583

Why do foreign banks stay in London?

Author(s):

Andrew Clare

Industry:
Banking

In recent light of the Independent Banking Commission's new report on reforming the banking sector, there is a new worry that some of the world's largest investment banks will leave London for countries that offer better incentives and benefits. However, a Cass research team has found that financial institutions may find there are different benefits to continuing operations in London.

Updated: 05/01/2015
Comments: 12
Views: 10,388

Optimal hedging with higher moments

Author(s):

Chris Brooks

 et al.
Industry:
Banking

A utility-based framework for the determination of optimal hedge ratios that can allow for the impact of higher moments on hedging decisions.

Updated: 18/12/2014
Comments: 1
Views: 7,857

Banning short sales and market quality: the UK's Experience

Author(s):

Ian Marsh

Industry:
Banking

We study the effects that the ban on short sales of shares in financial firms introduced in late 2008 and removed early 2009 had on the microstructure and the quality of UK equity markets. We show that the ban did nothing to affect order flows: financial stocks were being more aggressively sold off than their peers pre-ban and this situation persisted through the ban period.

Updated: 01/01/2015
Comments: 14
Views: 7,306

High frequency information content in end-user foreign exchange order flows

Author(s):

Ian Marsh

 et al.

This paper considers the impact of foreign exchange order flows on contemporaneous and future stock market returns using a new database of customer order flows in the €-$ exchange rate market as seen by a leading European bank.

Updated: 22/09/2011
Comments:
Views: 5,905

The dark side of alternative asset markets: networks, performance and risk taking

Hedge Fund network ties can lead to inferior performance and increased risks.

Updated: 03/11/2011
Comments:
Views: 7,046

Carry on speculating on the volatility of foreign exchange

Author(s):

Lucio Sarno

 et al.
Industry:
Banking

This article presents evidence of a new carry trade strategy - this time speculating on the volatility of foreign exchange.

Updated: 24/10/2011
Comments:
Views: 6,168