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

Brian Golden and Eduardo Maqui
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Brian Golden: Central Bank of Ireland
Eduardo Maqui: Central Bank of Ireland

No 14/RT/18, Research Technical Papers from Central Bank of Ireland

Abstract: 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.

Keywords: International banking; cross-border debt issuance; special purpose entities (SPEs); Irish non-bank financial sector; shadow banking. (search for similar items in EconPapers)
JEL-codes: G01 G15 G21 (search for similar items in EconPapers)
Date: 2018-12
New Economics Papers: this item is included in nep-ban
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:cbi:wpaper:14/rt/18

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