OECD Journal: Financial Market Trends

Frequency :
Semiannual
ISSN :
1995-2872 (online)
ISSN :
1995-2864 (print)
DOI :
10.1787/19952872
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The twice-yearly journal from OECD providing timely analyses and statistics on financial matters of topical interest and longer-term developments in specific financial sectors. Each issue provides a brief update of trends and prospects in the international and major domestic financial markets along with articles covering such topics as structural and regulatory developments in OECD financial systems, trends in foreign direct investment, trends in privatization, and financial sector statistics covering areas such as bank profitability, insurance, and institutional investors.

Periodically, a small number of articles within one field of financial sector developments – constituting the so-called special focus for the particular issue – may be included.

Now published as part of the OECD Journal package.

 

Latest Articles Hide / Show all Abstracts

Mark Number Date Article Volume and Issue Click to Access
  14 Oct 2014 Non-bank debt financing for SMEs
Iota Kaousar Nassr, Gert Wehinger

Reducing bank dependence in financing small-and medium-sized enterprises (SMEs) that are key contributors to economic growth and job creation should help making them more resilient to financial shocks. Various non-bank debt financing alternatives are available and were the focus of a Roundtable discussion that this article draws on. Revitalising securitisation, tarnished during the crisis, is important, by making it safer, simpler and more transparent, and perhaps also by offering some (initial) government and regulatory support. Similarly, covered bonds can be attractive instruments for SME finance. For mid-sized companies, bond issuance and private placements may also provide useful alternatives. All these instruments can and should be tailored to fit the investors’ needs. There is no "silver bullet" for SME finance which is exceptionally complex due to the diversity of SMEs themselves. Data transparency, standardisation, regulatory support and raising awareness about available financing options should be among the issues to be addressed.

JEL classification: G1, G2, G23, G28

Keywords: SME finance, non-bank finance, (high-quality) securitisation, asset-backed securities (ABS), SME CLO (collateralised loan obligation), (covered) bonds, private placements, European DataWarehouse, Prime Collateralised Securities (PCS) initiative.

Volume 2014 Issue 1 Click to Access: 
    http://oecd.metastore.ingenta.com/content/2714011ec005.pdf
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  • http://www.keepeek.com/Digital-Asset-Management/oecd/finance-and-investment/non-bank-debt-financing-for-smes_fmt-2014-5jxx05svvw34
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  14 Oct 2014 Financing infrastructure – International trends
Raffaele Della Croce, Stefano Gatti

The infrastructure financing market has gone through a process of radical transformation starting from the mid-2000s. Different reasons – including a changed macroeconomic environment, more stringent regulations on financial intermediaries, and a modified appetite for long-term asset investments – have led to a reallocation of flows from the banking sector to the institutional investors sector. This article provides an overview of international trends in infrastructure finance. It proposes a map of the different investment channels that private investors can use to access the infrastructure investment on the equity and debt side, highlighting the historical evolution of these segments in the past few years. Recently designed financial structures, such as different forms of partnership between banks and institutional investors, securitisation models and debt/credit fund vehicles, are also taken into consideration.

JEL classification: E2, G1, G11, G2, G3, H44, H54, H81
Keywords: infrastructure financing, long-term investment, institutional investors, public-private partnerships, bank institutional investors partnerships, syndicated loans, project bonds, securitisation, debt/credit fund vehicles, financial market regulation

Volume 2014 Issue 1 Click to Access: 
    http://oecd.metastore.ingenta.com/content/2714011ec006.pdf
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  • http://www.keepeek.com/Digital-Asset-Management/oecd/finance-and-investment/financing-infrastructure-international-trends_fmt-2014-5jxvpb4jfrf1
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  14 Oct 2014 Problems in the international financial system
Adrian Blundell-Wignall, Caroline Roulet

Since the 1980s OECD investment-saving correlations – as an inverse measure of economic openness – indicate a very wide disparity of openness between the OECD and emerging market economies (EMEs) with an absence of open markets in the latter. Given the increasing weight of EMEs in the world economy this pattern of growth with disparity of openness is ultimately unsustainable. This approach to development is not in the interests of EMEs in the post-crisis global environment. Various studies show how the absence of capital mobility inhibits development though private sector capital expenditure at the firm level. This paper generalises those findings in a panel study, showing that in the period since 2008 the increased presence of capital controls is associated with highly significant negative effects on business investment. It suggests that the world economy could be entering a more dangerous phase of potential instability that is not in the interests of either the advanced or the emerging world. There is scope for better policies to encourage more openness; the OECD Codes of Liberalisation could be an effective tool for managing the reform process.

Volume 2014 Issue 1 Click to Access: 
    http://oecd.metastore.ingenta.com/content/2714011ec004.pdf
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  • http://www.keepeek.com/Digital-Asset-Management/oecd/finance-and-investment/problems-in-the-international-financial-system_fmt-2014-5jxzmkg91s0t
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  14 Oct 2014 Policy responses to the issue of implicit bank debt guarantees
Sebastian Schich, Yesim Aydin

Bank regulatory reform is expected to limit the value of implicit bank debt guarantees, even if not plainly targeting such values. According to the responses from 35 countries to a survey on implicit bank debt guarantees, there is however no one specific policy capable of fully eliminating the market perception that bank debt is "special". A mixture of several different and complementary policy measures is considered more helpful, with recurrent elements including the implementation of internationally agreed capital and liquidity standards, the tightening of micro- and macro-prudential supervision and making bank failure resolution more effective. As regards the overall thrust of bank regulatory reform efforts, most respondents suggest "strengthening banks" and "strengthening the capacity to withdraw the guarantee function" describes best their own efforts. By contrast, labelling certain policy measures as "effectively charging a user fee" is considered problematic as it might make explicit what currently is at most implicit.

Volume 2014 Issue 1 Click to Access: 
    http://oecd.metastore.ingenta.com/content/2714011ec003.pdf
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  • http://www.keepeek.com/Digital-Asset-Management/oecd/finance-and-investment/policy-responses-to-the-issue-of-implicit-bank-debt-guarantees_fmt-2014-5jxzbv3r1x9x
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  14 Oct 2014 Measurement and analysis of implicit guarantees for bank debt
Sebastian Schich, Yesim Aydin

Implicit guarantees of bank debt create economic costs and distortions, which is why policy makers have clearly announced their intention to rein in the value of implicit guarantees. This report identifies key findings from the responses from 35 countries to a survey on implicit guarantees. The survey shows that while authorities have not settled on the best way of measuring such guarantees, it is important to produce estimates of the value of these guarantees to facilitate the task of assessing progress in bank regulatory reform and in reducing the value of these guarantees. Whatever method is used, the value of implicit bank debt guarantees is substantial. In absolute terms, the estimated funding cost advantages can amount to about USD 10 billion on an annual basis for banking sectors in some jurisdictions and, in many cases, they are estimated to represent the equivalent of 1% of domestic GDP; in crisis situations, this value could rise to close to 3% of domestic GDP.

Volume 2014 Issue 1 Click to Access: 
    http://oecd.metastore.ingenta.com/content/2714011ec002.pdf
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  • http://www.keepeek.com/Digital-Asset-Management/oecd/finance-and-investment/measurement-and-analysis-of-implicit-guarantees-for-bank-debt_fmt-2014-5jxzbv3r9rf4
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  14 Oct 2014 Improving the monitoring of the value of implicit guarantees for bank debt
Sebastian Schich, Michiel Bijlsma, Remco Mocking

The value of implicit guarantees has declined from its peak at the height of the financial crisis, which is consistent with progress made regarding the bank regulatory reform agenda, as one would expect that many of the reform measures imply a more limited value of implicit guarantees for bank debt. Implicit guarantees persist however and their value continues to be significant, estimated here to be equivalent to EUR 50 billion of annual funding costs savings for a sample of more than 100 large European banks. This estimated funding cost advantage is a conservative estimate as it only focuses on one type of debt that can be measured in "real-time", that is as data on credit ratings, debt issuance and prices of debt become available. In any case, bank debt continues to be considered "special" by market participants and this observation implies that the substantial economic distortions, including distortions to risk-taking incentives and competition, arising from this situation also persist.

Volume 2014 Issue 1 Click to Access: 
    http://oecd.metastore.ingenta.com/content/2714011ec001.pdf
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  • http://www.keepeek.com/Digital-Asset-Management/oecd/finance-and-investment/improving-the-monitoring-of-the-value-of-implicit-guarantees-for-bank-debt_fmt-2014-5jxzmkgjnt9x
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  20 Mar 2014 SMEs and the credit crunch
Gert Wehinger

After a brief overview of current financing difficulties for SMEs and policy measures to support SME lending during the crisis,this article presents a literature review related to difficulties in SME’s access to finance during the crisis, against a background of a sharp decline in bank profitability and an erosion of bank capital that negatively affected lending. The articles reviewed are classified according to four main issues of interest:the impairment of the bank-credit channel and its economic effects;factors potentially attenuating the effect of a financial squeeze;the role of global banking in mitigating but also transmitting financial shocks; and,looking ahead,issues related to so-called "credit-less recoveries" that should be relevant in guiding policy makers in the current environment of financial deleveraging. All the results hold important implications for policy making given the bail-outs and the large injections ofliquidity by central banks during the crisis.
 


 

Volume 2013 Issue 2 Click to Access: 
    http://oecd.metastore.ingenta.com/content/2713021ec006.pdf
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  • http://www.keepeek.com/Digital-Asset-Management/oecd/finance-and-investment/smes-and-the-credit-crunch_fmt-2013-5jz734p6b8jg
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