The University of Bedfordshire
Business School
Department of Accounting and Finance
 
 Australia：ADVANCES IN BANKING  AAF009-3代写
 
ADVANCES IN BANKING
 
AAF009-3
 
Why does U.K. urge its banks to raise more capital?

by
 
SUN HAO & 1200914

A project submitted in partial fulfillment of the requirements for the degree of  BA (Hons) Accounting
 
                                   14/08/2013
 
Why does U.K. urge its banks to raise more capital
 
Introduction
   Andrew Bailey is top Banks regulator in U.K., he told the lawmakers that the banks should hold at least 3% equity against the entire wealth, this requirement is the minimum quantity, especially the people who can not reach the demand should act in a fast speed without decreasing their lending to the individuals and transaction parties. However, things did not operate very smoothly. On June 20, the England’s cautious regulation authority announced that the Barclays and the nationwide building society which is the mutual lender did not meet the criteria, therefore 10 days were given to them in order to achieve that goal. The goal is so accurate and strict, making the whole UK financial society become prudential about that requirement. This action will absolutely change the current financial situation of UK, it can even make sense to the other economic authorities , no matter the ones which are in this country or the others from other countries, such as ,the members of the European Union(Besanko,1996). Therefore there is an urgent need for us to work out why the U.K. banks regulator presses its banks to raise more capital, what are their objectives and how they can achieve them.

Background
   The United Kingdom owes a very big national economy which is measured by the nominal GDP, now it is the sixth-largest economy in the whole world, however, it is the eighth-largest national economy if this is measured by the purchasing power parity. In Europe, the United Kingdom is the third-largest economy measured by GDP in together with the second-largest national economy measured by the purchasing power parity. The national economy of UK has been treated as the strongest economies for its inflation, unemployment rate and the rates of interest, the three figures was in a low condition until the recession’s coming. The unemployment rate in UK reached its highest point at 7.8%, which was much lower than some European countries. In the meantime ,the interest rate has descended to 0.5%.. Nowadays the inflation in UK still keeps a very low level and less changeable, the labor market in UK can also supply lots of jobs to the UK citizens which is more resilient when comparing to the other national economies in Europe. While the individual costing and spending are very large when comparing to other national economies in Europe. There is a report which is published by the famous Moody’s Corporation, it tells people that the debt-to-GDP ratio in UK still keeps increasing in 2013 in together with reaching 93% when the year comes to the end. What’s more, the UK could not keep its credit rating of triple-A because of its difficult financial future. Therefore the UK government need to take some effective measures which can help the UK economy reverse to a good side. For instance,U.K. urges its banks to raise more capital, if this action can be applied smoothly, the U.K. economy is gonna make a progress.
   Furthermore, The UK economy grew by 0.6% in the three months to June. The figure meant the economy has recouped more than half the 7.2% of output lost in the 2008-09 recession. Despite the relatively strong figure, analysts said the outlook for the rest of the year remained uncertain, so that the banking industry should raise more capital to boost the U.K. economy.
 
Literature Review
1. Introduction about the literature review about why a country usually presses the banks to increase its capital.
   There are so many literature which talk about why a country usually presses the banks to increase its capital. Usually people often divide the reasons for U.K. urges its banks to raise more capital into the following parts.Primarily, the BBS news tell people that the aging population in UK are going to put heavy pressure on the sector of public finances. If there is no action can be taken to solve this huge problem, in the meanwhile, the elderly population is increasing with their costs also coming to a high and raising condition. What’s more, the pensions and health care’s use occupy a definitely huge part of the entire cost. Hence the raise of bank’s capital can compensate a portion of leak coming from that cost(Hellmann,2000).
   Besides,the entire quantity of borrowing money fell £2.1billion from 2012, that figure is contrary to the forecast which is made in May. The public sector does not have any borrowing, except for the interventions cost, for example the interventions cost from the pension transfer of the Royal Mail. The borrowing of the public sector has been revised to £116.5 billion. Therefore the country need to seek out some other ways to increase their own capital instead of the positive borrowing from others, perhaps the most effective approach is urging the banks to attract more capital(Flannery,2006).
   The last but not least, some banks in Britain need to keep its stability in finance, hence they turn to raise money. Andrew Bailey who is the incoming deputy governor in the England bank and is going to regulate the entire country’s banks, has warned people that the some banks really should raise their money to be stable.
   The above three points all urge the U.K. banks regulator to curb the "leverage ratio” and keep a new percentage in equity to assets. Furthermore, because of these actions the brilliant future of U.K. economy is around the corner.
2. Studies about the fact that how can the banks regulators press the banks to increase its capital.
   There are so many literature which talk about how can the banks regulators press the banks to increase its capital. Banks can increase their capital in a lot of ways. the organizers of UK banks who are usually the stakeholders or the founders of organizations put their money to the banks, this is the most common approach for banks to raise money. The amount of capital which need to build and operate a bank is different in different countries, the banks get money by the bank’s organizers is also different which varies from 10% to 15%. The organizers can be treated as the investors of the banks, they have very strong interest in operating the lending authority. If the organizers is good at raising capital, the bank can lend out lots of money and it can function in a healthy and reasonable way(Barrell,2009).
   Shareholders help to raise capital.The capital which is poured by the organizers usually makes up over 10% to 15% of the bank’s entire investment. Shareholder refers to people who pour their money to the bank through the public borrowing approach(Berger,1994). The number often varies in shareholders and their investments. Like other categories of the partnership, this relationship between the shareholders and the banks can make the shareholders earn money, such as the profit, from the investment’s operation.
The free markets can lend capital.In fact, the banks still have other ways to raise money. They can borrow it from the UK financial markets.The banks often operate this action in the market which is free for transaction. These kind of free market are capitalist economies which are very useful tool to let people borrow in the free markets, due to the fact that they are the buffer and they can own lots of benefits from them. In the meantime,if the free markets need money, they can turn to the banks for help and borrow the corresponding money from them. However, some shortcomings still appear in the capitalist economies, not only appear in the lenders but also the borrowers(Coval,2009). But at the market’s most difficult time, the lenders may get back the money which borrow from the free market to them or not. The free market usually borrow money from the banks only when they have urgent dilemma, they often can not get the capital very easy. The banks also can not act freely in this kind of action, due to the fact that they can not put their capital into the long-term strategic plans.
 
   The government can offer capital.The banks have anther way to raise money, that is, getting the money from local government. The cities where the local free market is not so effective and can not work well, banks can turn to the government for help, due to the fact that the local government bonds are good source for helping the banks raise money. The governments in countries like China and India,the lending from the government can be definitely effectively tool to collect money because of the financial department in those countries do not be controlled fully. This kind of action can not performed in the free market, it often happens in nations like China and India, but not be so common in the consumerist economies, for instances the countries like the United States.
   The banks usually borrow bonds or other financial products from the governments. At the same time, the governments can lend the bonds and other financial products for safe, owing to the reason that the demand is not always be the dictated by the consumer(Elsinger,2006). In general, most agriculture country’s people can obtain money from the government in a direct way when the main industries of their countries face problems, the money mainly comes from the banks which once had raised money from the government. This is just a transfer of money between the government and banks. In some agricultural countries,the behavior of raising money can be viewed like a transfer of capital.
Other Approaches.The ways of the banks raising money is very various. When the economy comes to a slowdown,some companies which major in finance often suggest the banks about the ways to raise money. They have the aims to tell the banks  how to convince the government to lend money to them and how to cooperate with the free market. There are lots of financial companies like this, for instance , the Morgan Stanley financial company,they can gain a huge amount of money form those banks. What’s more ,sometimes this kind of companies can also help the banks to raise money. The capital which they get from the transaction can be put back to the free market and some other places, in that case can those banks earn more capital. Hence the behavior of raising money can not be viewed as a traditional way.
2. Studies about in which way the banks put the raising currency into use.
   There are so many literature which talk about in which way the banks put the raising currency into use.On one hand, the banks will use the raising money to make a loan to people who need money, they can make the lending rate higher than the borrowing rate, in which way can they make a profit on the raising money, so that they can make full use of the raising capital and even earn more capital with the previous currency. They can also help the underdeveloped sectors develop themselves and indirectly boost the national economy. On the other hand, the banks can invest these money to the financial products, such as the financial derivatives and foreign exchange. They can pour capital into those financial products at their low price level and sell them when the price become very high, in this case can they earn the corresponding margin on this behavior and make a good use of the entire currency. Furthermore , there are also other ways in which the banks use the raising money, for example they can lend the money to the government when the nation comes to a difficult situation.
3. Studies about the impact on the economy which is caused by the bank’s actions.
   There are so many literature which talk about the impact on the economy which is caused by the bank’s actions.The whole country can be deeply affected by the banks action which raise money from so many approaches. The influence can be divided into the following parts, one of that is the investment in the entire nation can be improved to a higher level, this phenomenon can be explained by that the banks have more money to make the loan and lend them to the clients so that they can invest to the sectors or industries which need these money urgently, what’s more , the banks can also make a profit on the lending capital and obtain more money.  By this action the national economy can be boosted in together with the underdeveloped department of the country can gain more focus and real development(Kato,2010).
4. A brief conclusion of the literature review
   The literature review picks out many literature or essays which are related to the action that the banks often need to raise money(Gale,2005). There are some conclusions of this issue, one of them is that, the banks raise money because the aging population in UK are going to put heavy pressure on the sector of public finances, what’s more, the entire quantity of borrowing money in the nation deeply fell, therefore banks should raise more money to boost the national economy. Furthermore,some banks in Britain need to keep its stability in finance, hence they turn to raise money. Banks can increase their capital from shareholders,the free markets ,the local government and other sources(Elliott,2013). Besides, the banks can use their money to make a loan to individuals or enterprises, in together with directly invest to the financial products or lend to the government instead. Finally ,by these actions the national economy can be boosted in together with the underdeveloped department of the country can gain more focus and real development.
 
Research Methodology
   The research philosophy used in this research proposal is ontology. Ontology is concerned with nature of reality. This raises questions of the assumptions researchers have about the way the banking industry operates and the commitment held to particular views. The ontology philosophy can be divided into two aspects, these two aspects all have positive influence to the analysis of business and enterprise’s management. Through the assumption of raising money can do good to the economy of nation and it can also influent the banks themselves in a good manner. This method can help people know the banks functions well.The objectivism tell out the exact method of the previous assumptions, it can help people understand the whole process of the assumption and how to achieve the result of this issue. In this research project , the objectivism can tell us how to motivate the U.K. economy by the banking. In the meanwhile, the view of subjectivism can be defined like that, it derives from the social phenomenon and roots in the perspectives and commitments from people(Avery,1991). It can greatly represent the actors in the society. The subjectivism also refers to the consecutive interaction between the mentioned issue and the other relevant phenomenon in the society. In this article, the raising money of the banks is an action which has consecutive interaction with some other problems, for instance ,how the country can benefit from this action, why a country usually presses the banks to increase its capital. ,which way the banks put the raising currency into use,how the banks regulators press the banks to increase its capital,the reasons for the fact that U.K. urges its banks to raise more capital,the direct or indirect usage of the raising capital,the ways for banks put the raising currency into use. The subjectivism can let us understand the meanings of these actions. 
   What’s more, this research proposal combined the two main research approaches together, it not only use the deduction to make a hypothesis of there is a need for the U.K. banks regulator to urge the banks to raise more capital, but also take advantage of the induction to analyze the collected data and developed theory, such as, what is the targets of the bank’s actions and how can they achieve those goals(Zimmer,1991). This research proposal also make an exactly analysis of how the raising money can make a benefit to themselves even the nation. This article presents the data of increasing rate of U.K.GDP in the latest years in together with the data of equity against total assets rate in the recent years. Through the intensive study of those data, therefore the result can be easily reached out.The combination of the two main research approaches, that is ,objectivism and subjectivism, this action contributes to the quickly analysis of those data.
 
Data Collection and Analysis
1. Present the data of increasing rate of U.K.GDP in the latest years.
Annual GDP growth rate (2003 to present)
Annual GDP growth rate (2003 to present)
Year     GDP Change
2003     4.4%
2004     1.9%
2005     4.4%
2006     1.7%
2007     3.6%
2008     -4.3%
2009     -2.5%
2010     1.7%
2011     1.1%
2012     0.0%
2013Q1     0.3%
2013Q2     0.6%
Source:http://www.google.com.hk/url?q=http://www.tradingeconomics.com/united-kingdom/gdp-growth&sa=U&ei=9EAKUoSlCe2SiAfoyIHYDA&ved=0CCMQFjAD&usg=AFQjCNEbgcJky853P4Ticgp-5iPBSXpLvQ
 
2. Present the data of History of the UK national debt as a proportion of GDP.
History of the UK national debt as a proportion of GDP
 

          Source: Ferguson, Niall, Civilization: The Six Killer Apps of Western Power, Penguin Books, London ,2012.
3. Analyze the above data and reach out findings.
   The data which is showed in the table means that the Annual GDP growth rate has kept a low condition from 2003 to present. The figure even descended to 0.0% in 2012. It shows that the development of economy in England has been very slow so that the national government needs to take some measures to suppress the descending tendency of the economy. Hence the banks should raise their capital and use these capital to save the country’s finance situation.
   The data in the picture describes the history of the UK national debt as a proportion of GDP. The national debt reached to £1,377.4 billion in 2013 Q1 which occupied 90.7% of the entire GDP. The figure is more higher in 1970s and before, the England economy is more developed at that time, therefore the country need to increase the banks capital in order to make up the vacancy in public borrowing.
   In conclusion, the above two data all show that the UK banks need to raise their capital and boost the national economy.
Discussion
1. Discussion about why a country usually presses the banks to increase its capital.
   The increasing of the banks capital have two sides of affects. On one hand ,the whole country can be deeply affected by the banks action which raise money from so many approaches.The investment in the entire nation can be improved to a higher level, what’s more , the banks can also make a profit on the lending capital and obtain more money. By this action the national economy can be boosted in together with the underdeveloped department of the country can gain more focus and real development(Heuvel,,2008).
   However there are also some shortcomings of this acton, one of them is that the banks can not put these currencies into good usage for sure, the direct or indirect investment may not really have so much good performance like people original expectation, neither can the banks make huge profit nor can they even make ends meet. Hence both the advantages and disadvantages are all existing in the process of raising money. Nevertheless, generally speaking, the influence of advantages are stronger than it of the disadvantages, therefore it’s good for the U.K. Regulator to urge the banks to raise money.
2. Discussion about the impact on the economy which is caused by the bank’s actions.
   The economy can benefit a lot from the bank’s raising money, but there are still many faultiness existing in this action. Specifically speaking, the benefits can be described like the following sections, Firstly , the raising money can relieve the pressure coming from the aging population in UK, taking this measure can help the country solve this problem of the elderly population’s increasing cost, pensions and health care(Thakor,1996). Hence the raise of bank’s capital can compensate a portion of leak coming from that cost. Besides,this action can also make for the lacking of the borrowing from the public sector.Therefore the country need to seek out some other ways to increase their own capital instead of the positive borrowing from others, perhaps the most effective approach is urging the banks to attract more capital.The last but not least, the raising capital can help some banks in Britain keep its stability in finance.
   The faultiness existing in this action is that the loan from the banks may not act so effective like it used to expect, owing to the fact that , some banks would like to earn more money instead of carefully checking the exactly details of those enterprises which turn to borrow money from the banks and give the corresponding interest to them. Hence the banks may lend their money to sectors or industries which should be closed in an early time, or just need to stop to invest more capital to it because of its serious pollution and other disadvantages to operate, for instance ,the credit may not flow so smoothly and unhindered in those companies.Nevertheless, generally speaking, the influence of advantages are stronger than it of the disadvantages, therefore it’s good for the U.K. Regulator to urge the banks to raise money.
 
3. Discussion about in which way do the banks raise money.
   The approaches for the U.K. banks to raise money is various. The organizers of UK banks who are usually the stakeholders or the founders of organizations put their money to the banks, this is the most common approach for banks to raise money(Gibson,1995). The organizers can be treated as the investors of the banks, they have very strong interest in operating the lending authority. If the organizers is good at raising capital, the bank can lend out lots of money and it can function in a healthy and reasonable way. What’s more, raising money from the shareholders is also an effective approach.Shareholder refers to people who pour their money to the bank through the public borrowing approach. The number often varies in shareholders and their investments. Like other categories of the partnership, this relationship between the shareholders and the banks can make the shareholders earn money, such as the profit, from the investment’s operation. Besides, the banks can raise the capital from the local free market either. That is to say, they can borrow it from the UK financial markets.The banks often operate this action in the market which is free for transaction. These kind of free market are capitalist economies which are very useful tool to let people borrow in the free markets, due to the fact that they are the buffer and they can own lots of benefits from them(Haubrich,1993). Except the above approaches, the government can also help the banks raise money.The cities where the local free market is not so effective and can not work well, banks can turn to the government for help, due to the fact that the local government bonds are good source for helping the banks raise money. There are other ways for the banks to add up some money. For instance, some financial companies can give their suggestions to the banks so that they can smoothly gain the money from other authorities,such as convince the government to lend money to them and how to cooperate with the free market.Moreover they can also directly raise the capital to the banks by putting back to the free market and some other places, in that case can those banks earn more capital. Hence the behavior of raising money can not be viewed as a traditional way.
4. Discussion about how the banks regulators press the banks to increase its capital.
   There are so many ways for the banks regulators give the pressure to the banks to urge them to raise money. One of them of is that they can issue the regulation to the public, especially the banking industry, the policies can effectively regulate the bank’s behaviors and help them to raise money, the regulation can relate to the lot reject rate, inter bank discount rate and interest rate. What’s more, there are also other ways for the banks regulators to press the banks, they can encourage the banks to raise capital by make effective promotion and make enough advertisements, in together with letting them know the positive function of the action, what’ more, the banks regulator can use the legal approach, that is to say, the banks need to raise money because of the legal restrictions, this is the strictest way for the banks, due to the fact that they can just obey the laws instead of against them, this way can help the banks add money at a fast speed.
Conclusions and Recommendations
1. Conclusions about the reasons for the fact that U.K. urges its banks to raise more capital.
   The reasons for the action that U.K.banks regulator urges the banks to raise more capital can be divided into the following sections. Firstly ,the U.K. Banks may lose lots of money in the field of the bad loans or loans with high-risk in the near future. The bad loans may lie in the sector of commercial property of England and other economies in the Euro zone. What’s more ,the banks may also lose their money on fines, hence they demand more money to face the risk in their banks(Jagtiani,1995). Secondly, the aging population is anther crucial factor for why the banks need to raise money. It has become very heavy pressure for the sector of public finances.If there is no action can be taken to solve this huge problem, in the meanwhile, the elderly population is increasing with their costs also coming to a high and raising condition. What’s more, the pensions and health care’s use occupy a definitely huge part of the entire cost. Furthermore, as the borrowing of the public sector has become lower and lower which has fell £2.1 billion from 2012, that figure is contrary to the forecast which is made in May. The public sector does not have any borrowing, except for the interventions cost, for example the interventions cost from the pension transfer of the Royal Mail. Perhaps the most effective approach is urging the banks to attract more capital. Finally , the lacking of stability in Britain banks is anther significant reason.Andrew Bailey who is the incoming deputy governor in the England bank and is going to regulate the entire country’s banks, has warned people that the some banks really should raise their money to be stable.
2. Conclusions about the financial impact caused by the bank raising capital.
   The impact caused by the bank raising capital is comprised by many parts. Speak to the impact of the nation, the pressure of the aging population can be relieved a lot, the money can make up the vacancy in the increasing cost which is caused by the elderly population, in together with raising the pensions and health care(Giddy,1985). Secondly, the raising of the banks capital can relieve the suppress by the low public borrowing, make sure the banks can still operate in a smooth condition, instead of the positive borrowing from others, perhaps the most effective approach is urging the banks to attract more capital. What’s more, the raising money can also help the banks keep stable and stead in finance.
   The last but not least, the raising capital can help some banks in Britain keep its stability in finance.
   The faultiness existing in this action is that the loan from the banks may not act so effective like it used to expect, owing to the fact that, some banks would like to earn more money instead of carefully checking the exactly details of those enterprises which turn to borrow money from the banks and give the corresponding interest to them(Santos,2012). Hence the banks may lend their money to sectors or industries which should be closed in an early time, or just need to stop to invest more capital to it because of its serious pollution and other disadvantages to operate, for instance ,the credit may not flow so smoothly and unhindered in those companies.Nevertheless, generally speaking, the influence of advantages are stronger than it of the disadvantages, therefore it’s good for the U.K. Regulator to urge the banks to raise money.
3. Recommendations about the ways to raise capital.
   In order to make u the losses of the potential condition, the U.K banks need to add £25 billion in the end of the year of 2013. However the Financial Policy Committee of the Banks of England mentioned that not all the banks in England need to raise the capital, only a part of them need to take this action because of the bad loans in their bank’s system in together with the fines(Barberis,2008).
   Therefore people wonder that how to raise these money, the answer is that the banks are possible to add their money by issuing lots of bonds and selling the shares which are hold in their banks. This announcement is confirmed by the Financial Policy Committee of the Banks of England firstly who is the new financial regulator which aims to keep the stability in England. Due to the U.K. Banks may lose lots of money in the field of the bad loans or  loans with high-risk in the near future. The bad loans may lie in the sector of commercial property of England and other economies in the Euro zone. What’s more ,the banks may also lose their money on fines, hence they demand more money to face the risk in their banks.
   The banks can not require the U.K. government to raise new money for them, therefore they can only raise the capital by bonds issuing and shares selling.
4. Recommendations about the ways for banks put the raising currency into use.
   There are so many ways for the banks to use the raising money. Firstly, they can choose to lend the money to enterprises which can help them broaden the market share and research the new product in together with improve the quality of the existing products, moreover , the banks can use the raising money to make a loan to people who need money, they can make the lending rate higher than the borrowing rate, in which way can they make a profit on the raising money. Secondly, the banks can also lend the money to the government when the local government has came to a dilemma, the capital can be used to help the underdeveloped sectors develop themselves and indirectly boost the national economy. Finally, they can directly invest the capital into the financial products, such as the financial derivatives and foreign exchange. In that way can they gain more profit and margin except only the interest of the loan. The banks can choose the reasonable products and aim to earn some money from them.
References
 
Hellmann, Thomas F., Kevin C. Murdock, and Joseph E. Stiglitz.,2000.Liberalization, Moral Hazard in Banking, and Prudential Regulation: Are Capital Requirements Enough? American Economic Review,pp.90: 147-165.
 
Gale, Douglas, and Onur Ogur.,2005. Are Bank Capital Ratios Too High or Too Low? Incomplete Markets and Optimal Capital Structure, Journal of the European Economic Association,pp3: 690-700.
 
Flannery, Mark J., and Kasturi P. Rangan.,2006. Partial adjustment toward target capital structures.Journal of Financial Economics,pp79: 469-506.
 
Kato, R, S Kobayashi and Y Saita.,2010.Calibrating the level of capital: the way we see it,Bank of Japan Working Papers, no 10-E-6.
 Australia：ADVANCES IN BANKING  AAF009-3代写
Elsinger, H, A Lehar and M Summer.,2006.Using market information for banking system
risk assessment, International Journal of Central Banking, vol 2, no 1, pp 137–65.
Barrell, R, E Davis, T Fic, D Holland, S Kirby and I Liadze.,2009. Optimal regulation of bank
capital and liquidity: how to calibrate new international standards, FSA Occasional Papers,no 38.
Avery, R B and A N Berger.,1991. An Analysis of Risk-Based Capital and Its Relation to Deposit Insurance Reform, Journal of Banking and Finance, pp. 847-874.
Berger, Allen N and Gregory Udell.,1994.Did Risk-Based Capital Allocate Bank Credit and Cause a “Credit Crunch” in the United States? Journal of Money, Credit, and Banking, 26, pp. 585-628.
Besanko, David and George Kanatas.,1996.The Regulation of Bank Capital: Do Capital Standards Promote Bank Safety?Journal of Financial Intermediation, 5, pp. 160-183.
Gibson, Michael S.,1995.Can Bank Health Affect Investment? Evidence from Japan, Journal of Business, 68, pp. 281-308.
Giddy, Ian.,1985.Regulation of Off-Balance Sheet Banking, in The Search for Financial Stability: The Past Fifty Years, Federal Reserve Bank of San Francisco, pp. 165-177.
Haubrich,J and P Wachtel.,1993.Capital Requirements and Shifts in Commercial Bank Portfolios,Federal Reserve Bank of Cleveland Economic Review, 29, pp. 2-15.
Jagtiani, J, A Saunders and G Udell.,1995.The Effect of Bank Capital Requirements on Bank Off-Balance Sheet Financial Innovations, Journal of Banking and Finance, 19, pp. 647-658.
Zimmer, and McCauley.,1991.Bank Cost of Capital and International Competition,Federal Reserve Bank of New York Quarterly Review, Winter, pp. 33-59.39.
Thakor,Anjan V.,1996.Capital Requirements, Monetary Policy, and Aggregate Bank Lending:Theory and Empirical Evidence, Journal of Finance, 51, pp. 279-324.
Elliott, Douglas J. “Higher Bank Capital Requirements Would Come at a Price.” Brookings Institute Internet posting.
http://www.brookings.edu/research/papers/2013/02/20-bank-capital-requirements-elliott
(February 20, 2013).
Coval,Joshua, J. Jurek, E. Stafford.,2009.The Economics of Structured Finance.Journal of Economic Perspectives 23, pp. 3-25.
Heuvel, Skander J.,2008.The Welfare Cost of Bank Capital Requirements,Journal of Monetary Economics, pp. 298-320.
Santos, Andre Oliveira, D. Elliott.,2012.Estimating the Costs of Financial Regulation.” IMF Staff Discussion Note.
Barberis, Nicholas, M. Huang.,2008.Stocks as Lotteries: The Implications of Probability Weighting for Security Prices,American Economic Review 98, pp. 2066-2100.