Possible Unintended Consequences of Basel III and Solvency II

International Monetary Fund

No 2011/187, IMF Working Papers from International Monetary Fund

Abstract: In today's financial system, complex financial institutions are connected through an opaque network of financial exposures. These connections contribute to financial deepening and greater savings allocation efficiency, but are also unstable channels of contagion. Basel III and Solvency II should improve the stability of these connections, but could have unintended consequences for cost of capital, funding patterns, interconnectedness, and risk migration.

Keywords: WP; balance sheet; capital requirement; equity capital; credit risk; Basel III; Solvency II; Cost of Capital; Funding; Interconnectedness; fair value; bank assets; preference shares; conservation buffer; bail-in capital proposal; holding company; unsecured debt; Insurance companies; Solvency; Insurance; Financial statements; Europe; Global (search for similar items in EconPapers)
Pages: 70
Date: 2011-08-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Downloads: (external link)
http://www.imf.org/external/pubs/cat/longres.aspx?sk=25149 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:2011/187

Ordering information: This working paper can be ordered from
http://www.imf.org/external/pubs/pubs/ord_info.htm

Access Statistics for this paper

More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC.
Bibliographic data for series maintained by Akshay Modi ().