May 14, 2015
Credit and credit aggregates, Financial institutions, Financial markets, Financial services, Financial stability, Financial system regulation and policies, International financial markets, Lender of last resort, Monetary policy implementation, Payment clearing and settlement systems
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May 5, 2015
Liquid Markets for a Solid Economy
Senior Deputy Governor Wilkins discusses funding and market liquidity, and announces consultations on the Bank’s market operations and emergency lending frameworks. -
Household Stockholding Behavior During the Great Financial Crisis
Using the Panel Study of Income Dynamics, this paper studies household stock market participation and trading behavior in 2007–09, a period that saw a major stock market downswing. The stock market participation rate fell after the market crash. -
A Wake-Up-Call Theory of Contagion
We propose a novel theory of financial contagion. We study global coordination games of regime change in two regions with an initially uncertain correlation of regional fundamentals. -
Euro Area Government Bonds—Integration and Fragmentation During the Sovereign Debt Crisis
The paper analyzes the integration of euro area sovereign bond markets during the European sovereign debt crisis. It tests for contagion (i.e., an intensification in the transmission of shocks across countries), fragmentation (a reduction in spillovers) and flight-to-quality patterns, exploiting the heteroskedasticity of intraday changes in bond yields for identification. -
April 15, 2015
Release of the Monetary Policy Report
Press conference following the release of the Monetary Policy Report. -
March 26, 2015
Central Bank Credibility and Policy Normalization
Governor Poloz discusses the recent rise in financial market volatility and low long-term borrowing costs, and what they both mean for central bank credibility. -
Funding Liquidity, Market Liquidity and the Cross-Section of Stock Returns
Following theory, we check that funding risk connects illiquidity, volatility and returns in the cross-section of stocks. We show that the illiquidity and volatility of stocks increase with funding shocks, while contemporaneous returns decrease with funding shocks. -
Effects of Funding Portfolios on the Credit Supply of Canadian Banks
This paper studies how banks simultaneously manage the two sides of their balance sheet and its implications for bank risk taking and real economic activity. First, we analyze how changes in funding affect the supply of bank loans. -
Securitization under Asymmetric Information over the Business Cycle
This paper studies the efficiency of financial intermediation through securitization in a model with heterogeneous investment projects and asymmetric information about the quality of securitized assets. I show that when retaining part of the risk, the issuer of securitized assets may credibly signal its quality.