Natural Monopoly and Distorted Competition: Evidence from Unbundling Fiber-Optic Networks Staff Working Paper 2012-26 Naoaki Minamihashi Can regulation solve problems arising from a natural monopoly? This paper analyzes whether “unbundling,” referring to regulations that enforce sharing of natural monopolistic infrastructure, prevents entrants from building new infrastructure. Content Type(s): Staff research, Staff working papers Topic(s): Market structure and pricing, Productivity JEL Code(s): K, K2, K23, L, L4, L43, L9, L96
August 16, 2012 An Analysis of Indicators of Balance-Sheet Risks at Canadian Financial Institutions Bank of Canada Review - Summer 2012 David Xiao Chen, H. Evren Damar, Hani Soubra, Yaz Terajima This article examines four indicators of balance-sheet risks—leverage, capital, asset liquidity and funding—among different types of financial institutions in Canada over the past three decades. It also discusses relevant developments in the banking sector that could have contributed to the observed dynamics. The authors find that the various risk indicators decreased during the period for most of the non-Big Six financial institutions, but remained relatively unchanged for the Big Six banks. In addition, the balance-sheet risk indicators became more heterogeneous across financial institutions. The observed overall decline and increased heterogeneity follow certain regulatory changes, such as the introduction of the liquidity guidelines on funding in 1995 and the implementation of bank-specific leverage requirements in 2000. Given that these regulations required more balance-sheet risk management, they have likely contributed to the increased resilience of the banking sector. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Financial institutions, Financial stability, Financial system regulation and policies JEL Code(s): G, G2, G21, G28
August 10, 2012 Weekly Financial Statistics - 10 August 2012 Content Type(s): Publications, Historical: Weekly Financial Statistics
To Link or Not To Link? Netting and Exposures Between Central Counterparties Staff Working Paper 2013-6 Stacey Anderson, Jean-Philippe Dion, Héctor Pérez Saiz This paper provides a framework to compare linked and unlinked CCP configurations in terms of total netting achieved by market participants and the total system default exposures that exist between participants and CCPs. Content Type(s): Staff research, Staff working papers Topic(s): Payment clearing and settlement systems JEL Code(s): G, G1, G18, G2, G23
Market Structure and Cost Pass-Through in Retail Staff Working Paper 2013-5 Gee Hee Hong, Nicholas Li We examine the extent to which vertical and horizontal market structure can together explain incomplete retail pass-through. Content Type(s): Staff research, Staff working papers Topic(s): Inflation and prices, Monetary policy transmission JEL Code(s): E, E3, E30, E31, L, L1, L11, L16
Méthodologie de construction de séries de taux de défaut pour l’industrie canadienne Staff Discussion Paper 2013-2 Ramdane Djoudad, Étienne Bordeleau Default rates are series commonly used in stress testing. In Canada, as in many other countries, there are no historical series available for sectoral default rates on bank loans to firms. Content Type(s): Staff research, Staff discussion papers Topic(s): Econometric and statistical methods, Financial institutions, Financial stability JEL Code(s): C, C1, C13, C18, G, G2, G21, G3, G33
March 6, 2013 Bank of Canada maintains overnight rate target at 1 per cent Media Relations Ottawa, Ontario The Bank of Canada today announced that it is maintaining its target for the overnight rate at 1 per cent. The Bank Rate is correspondingly 1 1/4 per cent and the deposit rate is 3/4 per cent. Content Type(s): Press, Press releases
February 25, 2013 Rebuilding trust in banking is vital to improving the pace of global economic recovery, says Bank of Canada Governor Mark Carney Media Relations London, Ontario While much progress has been made reforming the global financial system, to restore fully trust in banking there remains a fundamental need for financial institutions to rediscover their core values, Bank of Canada Governor Mark Carney said today in a speech at Western University in London, Ontario. The real economy relies on the financial system, […] Content Type(s): Press, Press releases
February 21, 2013 The G-20 Framework for Strong, Sustainable and Balanced Growth: Macroeconomic Coordination Since the Crisis Bank of Canada Review - Winter 2012-2013 Robert Lavigne, Subrata Sarker Since 2009, the G-20 Framework for Strong, Sustainable and Balanced Growth has provided a mechanism for international macroeconomic policy coordination. The Framework has had some successes, including agreement on objectives for fiscal consolidation. However, post-crisis global growth has been neither strong nor balanced. Progress has also been slow in developing credible fiscal consolidation plans in some advanced countries and in increasing exchange rate flexibility in certain emerging economies. A stronger peer review process and enhanced analysis of international spillovers would increase the Framework’s influence on member policies. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Exchange rate regimes, Fiscal policy, International topics, Recent economic and financial developments JEL Code(s): E, E6, E61, F, F5, F53, F55
February 21, 2013 The U.S. Recovery from the Great Recession: A Story of Debt and Deleveraging Bank of Canada Review - Winter 2012-2013 Brady Lavender, Nicolas Parent The U.S. recovery from the Great Recession has been slow relative to other postwar-era recoveries in the United States. Encouraged by loose lending standards in the pre-crisis period, U.S. households took on unsustainable amounts of debt, making them vulnerable to adverse shocks. Subsequently, a considerable drop in asset prices forced households to repair their balance sheets. While there has been progress in household deleveraging, the government sector now needs to delever, which will restrain growth over the next few years. Content Type(s): Publications, Bank of Canada Review articles Topic(s): Business fluctuations and cycles, International topics, Recent economic and financial developments JEL Code(s): E, E2, E21, E6, E60