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How the banking system should continue to develop – and what we’re doing to further the discussion

2 July 2018

How is banking market discipline influenced by risk, and how systemic is it? What role should government play? How does competition affect a firm’s ethics? These were some of the topics discussed at the last Bristol Workshop on Banking and Financial Intermediation, held for the second time, last month.

"The excellent presentations and discussions attracted a large audience," said Lecturer in Finance, Piotr Danisewicz, who co-organised the event. “We had speakers from top European and U.S. institutions, from the University of Oxford and the University of Illinois, to the Bank for International Settlements. It is so important to keep the discussions about banking regulations and practices current, as institutions are still getting to grips with the results of global events, such as the 2008 financial crash.

"London is often seen as the heart of the financial sector in the UK, but Bristol, and the University of Bristol, is uniquely placed to bring together different disciplines and schools of thought, to further much-needed debate. More than 40 attended, which is very encouraging."

  • Alan Morrison, Professor of Law and Finance at Saïd Business School, University of Oxford, presented a paper on the relationship between market discipline and systemic risk.
  • The second presentation of the session by Lamont Black from DePaul University focused on how risky and safe collateral naturally pair with different types of lenders according to how informed the lenders are in states where borrowers are in financial distress.
  • Leonardo Gambacorta from the Bank for International Settlements commenced the second session presenting his work on the effect of taxation on banks’ liability structure.
  • Enrico Sette, a senior advisor in the Department of Economics and Statistics at the Bank of Italy, followed with his work which examines whether composition of bank funding affects bank lending policies.
  • John Thanassoulis from the University of Warwick contributed with presenting a theoretical model assessing the effect of competition on firms’ unethical behaviour.
  • Neeltje van Horen from the Bank of England presented a paper analysing the role of capital regulation in the functioning of repo markets.
  • The final presentation of the workshop was delivered by George Pennacchi, the Fred S. Bailey Professor of Money, Banking, and Finance at the University of Illinois, with a paper dealing with the question of how should governments create liquidity.

"The event provides a great opportunity for experts in their field to come together, and to present their work for comment. We thank all the presenters and the audience for their participation and hope to see them again at a possible future edition of the event."

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