The Financial Services Reform Act 2001: Impact on Systemic risk in Australia
AbstractThe rise of conglomerate banks and their interrelated balance sheets, pose new challenges to theories of financial regulation. We measure the impact of recent legislative changes in Australia upon systemic risk, for banking and near banking sectors, and demonstrate a significant reduction post the legislation. This is consistent with a major legislative goal, to promote global competitiveness, because it implies a reduction in the cost of equity capital. In addition, we find no evidence in support of the HIH collapse increasing systemic risk in the overall financial sector but a relatively small effect was detected in the banking sector.
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Bibliographic InfoPaper provided by Henley Business School, Reading University in its series ICMA Centre Discussion Papers in Finance with number icma-dp2005-12.
Length: 30 pages
Date of creation: Aug 2005
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Ris; Banks; Disclosure; Regulation; Entropy;
Find related papers by JEL classification:
- C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
- C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
- D8 - Microeconomics - - Information, Knowledge, and Uncertainty
- G2 - Financial Economics - - Financial Institutions and Services
- M4 - Business Administration and Business Economics; Marketing; Accounting - - Accounting
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