How ‘special’ are international banks sponsoring Irish-resident SPEs?

Brian Golden and Eduardo Maqui

Finance Research Letters, 2023, vol. 52, issue C

Abstract: This paper extends the literature on cross-border bank debt issuance to non-bank financial intermediation, namely special purpose entities (SPEs). Using a novel dataset for Ireland, the empirical analysis suggests that international banks sponsoring Irish-resident SPEs are financially weaker across a range of bank-level characteristics. Our findings also indicate that banks sustain higher risk profiles and achieve greater access to other debt markets after issuing cross-border debt through SPEs. This non-bank financial intermediation channel enables banks to expand their debt financing more broadly, whilst potentially amplifying the international transmission of risks.

Keywords: International banking; Cross-border debt issuance; Non-bank financial intermediation; Special Purpose Entities (SPEs) (search for similar items in EconPapers)
JEL-codes: G01 G15 G21 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:52:y:2023:i:c:s1544612322006262

DOI: 10.1016/j.frl.2022.103449

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