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A Peer-reviewed scientific articles/A1 Journal article (refereed), original research
      
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Monitoring the “invisible” hand of market discipline: Capital adequacy revisited, Journal of Banking and Finance January (2015). Hasan, Iftekhar; Siddique, Akhtar; Sun, Xian


Category A Peer-reviewed scientific articles
Sub-category A1 Journal article (refereed), original research
auki Internal authors
All authors as text Hasan, Iftekhar; Siddique, Akhtar; Sun, Xian 
Number of authors
Status Published
Year of publication 2014 
Date 15.01.2015 
Name of article Monitoring the “invisible” hand of market discipline: Capital adequacy revisited 
Name of journal Journal of Banking and Finance
Volume of issue 50 
Number of issue January 
Pages 475–492 
Abstract The recent U.S. financial crisis and governmental bailout of financial institutions have intensified the debate on the need for effectively measuring and monitoring the financial institutions’ risks. This paper contributes to this discussion by introducing a market-based capital measurement that better captures the dynamics of bank risk and returns. Evidence confirms that these market-based capital adequacy metrics are much more sensitive to risk factors and more responsive to economic events than the traditional accounting/regulatory report based capital models, which often underestimate the true capital needs. The CDS premia, another market-bases solvency measure, seems to overreact to declines in capital adequacy.
Free text descriptor in English Capital adequacy, Asset-pricing, Bank risk 
JEL-codes G01; G21; G28 
ISSN / e-ISSN 0378-4266 
auki Internet addresses
Additional information Available online 28 March 2014.
Open Access Not known