An Analysis of the Impact of 'Substantially Heightened' Capital Requirements on Large Financial Institutions

By Anil K. Kashyap, Jeremy C. Stein, S. G. Hanson. 2010

335 citations recorded by the source corpus.

View Paper: https://www.semanticscholar.org/paper/3da1aaf0804139dd9a0c1d5c6fc669a11bece2a3

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Citations in the corpus

The unreliability of credit-to-GDP ratio gaps in real-time: Implications for countercyclical capital buffers (2011, unknown): “15In a companion paper, Kashyap, Stein, and Hanson (2010) report estimates in a range of 25 to 45 basis points for a 10 percentage point increase in the capital ratio.”
Optimal Bank Capital (2013, unknown): “Kashyap et al. (2010) find that the long-run steady-state impact on bank loan rates from increases in external equity finance is modest, in the range of 25–45 basis points for a ten percentage point increase in the ratio of capital to bank assets (which would roughly halve leverage).”
The Leverage Ratchet Effect (2017, background): “…not explain resistance to earnings retention or rights offerings, neither of which is subject to market undervaluation of new shares.2 The uniform resistance we see to all these forms of leverage reduction, especially in 1 See for example Bolton and Freixas (2006) and Kashyap et al. (2010, 2011).”
Bank Size, Capital, and Systemic Risk: Some International Evidence (2016, unknown): “Yet others argue that such restrictive regulations would distort the allocation of banks' resources, hurting the efficiency of capital allocation and imposing substantial costs to the real economy (Kashyap et al., 2010b; Aiyar et al., 2014).”
Bank capital (requirements) and credit supply: Evidence from pillar 2 decisions (2016, unknown): “…all, the negative relationship between the required capital ratio and credit supply should be more pronounced for small and risky banks given that in general the cost of capital is lower for larger and safer banks (Gandhi and Lustig (2015), Baker and Wurgler 18 (2015), and Kashyap et al. (2010)).”
Shadow Banking and Bank Capital Regulation (2015, unknown): “6 Leland and Pyle (1977) or Diamond (1984) offer alternative, yet related, rationales for such pooling by banks.”
Benefits and Costs of Bank Capital (2016, background): “Kashyap, Stein, and Hanson (2010) use data for the U.S. and find that the MM theorem describes well the empirical relation between banks’ leverage and the return on equity.”