Arbeitspapier
Optimal bank transparency
Consider a competitive bank whose illiquid asset portfolio is funded by short-term debt that needs to be refinanced before the asset matures. In this setting, we show that maximal transparency is not socially optimal, and that the existence of social externalities of bank failures reduces further the optimal level of transparency. Moreover, asset risk taking decreases as the level of transparency decreases towards the socially optimal level. As for the sign of the impact of transparency on refinancing risk, it is negative given the asset´s risk, but it is ambiguous if we account for its indirect effect via risk taking.
- ISBN
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978-952-462-792-4
- Language
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Englisch
- Bibliographic citation
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Series: Bank of Finland Research Discussion Papers ; No. 9/2012
- Classification
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Wirtschaft
- Event
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Geistige Schöpfung
- (who)
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Moreno, Diego
Takalo, Tuomas
- Event
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Veröffentlichung
- (who)
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Bank of Finland
- (where)
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Helsinki
- (when)
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2012
- Handle
- Last update
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10.03.2025, 11:43 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Moreno, Diego
- Takalo, Tuomas
- Bank of Finland
Time of origin
- 2012
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