How 'special' are international banks sponsoring Irish-resident SPEs?

This paper focuses on cross-border debt issuance linking banks and shadow banking entities, providing new evidence associated with the characteristics of international banks sponsoring Irish-resident SPEs. Our empirical results show that banks sponsoring Irish-resident SPEs are larger and finanancially weaker across a range of indicators compared to other banks. We analyse how these indicators evolve following debt issuance through Irish-resident SPEs, where the impact is concentrated in the short term and largely dissipates after a year. This contrasts with the impact of debt issuance elsewhere, which is sustained beyond a year. However, a key purpose of banks issuing debt through Irish-resident SPEs may be to access debt markets elsewhere. We observe banks markedly increasing their issuance volumes in debt markets elsewhere after issuing debt through Irish-resident SPEs.