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The paper analyzes the relationship between bank competition and stability, with a specific focus on the Middle East and North Africa. Price competition has a positive effect on bank liquidity, as it induces self-discipline incentives on banks for the choice of bank funding sources and for the holding of liquid assets. On the other hand, price competition may have a potentially negative impact on bank solvency and on the credit quality of the loan portfolio. More competitive banks may be less solvent if the potential increase in the equity base—due to capital adjustments—is not large enough to compensate for the reduction in bank profitability. Also, banks subject to stronger competitive pressures may have a higher rate of nonperforming loans, if the increase in the risk-taking incentives from the lender’s side overcomes the decrease in the credit risk from the borrower’s side. In both cases, country-specific policies for market entry conditions—and for bank regulation and supervision—may significantly affect the sign and the size of the relationship. The paper suggests policy reforms designed to improve market contestability and to increase the quality and independence of prudential supervision.

Banks and banking --- Bank liquidity --- Bank failures --- Financial risk management --- Risk management --- Agricultural banks --- Banking --- Banking industry --- Commercial banks --- Depository institutions --- Finance --- Financial institutions --- Money --- Failure of banks --- Business failures --- Liquidity (Economics) --- State supervision --- Banks and Banking --- Finance: General --- Islamic Banking and Finance --- Industries: Financial Services --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Financial Institutions and Services: Government Policy and Regulation --- Corporation and Securities Law --- Production, Pricing, and Market Structure --- Size Distribution of Firms --- General Financial Markets: General (includes Measurement and Data) --- Bankruptcy --- Liquidation --- Financing Policy --- Financial Risk and Risk Management --- Capital and Ownership Structure --- Value of Firms --- Goodwill --- Other Economic Systems: Public Economics --- Financial Economics --- Financial services law & regulation --- Competition --- Bank solvency --- Credit risk --- Islamic banking --- Financial markets --- Financial sector policy and analysis --- Financial regulation and supervision --- Financial services --- Nonperforming loans --- Islamic countries --- Loans --- Saudi Arabia

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During the global financial and European debt crises, quantitative easing programmes were implemented by central banks to mitigate the intensifying risks of a financial collapse. Quantitative easing is a unconventional form of monetary policy in which a central bank purchases securities on the open market. After a prolonged period of low inflation and growth prospectives, the European Central Bank started an asset purchase programme in 2014. Although the asset purchase programmes ended in 2022, not every aspect of its effects is fully understood yet. This paper focuses on the purchases of corporate bonds under the Corporate Sector Purchase Programme. In particular ineligible bonds, issued by financial corporations, were analysed to investigate whether these bonds, which were not purchased by the European Central Bank, still were affected by the Corporate Sector Purchase Programme. This indirect effect can act through the portfolio rebalancing channel, as investors adjust their portfolio by investing in other securities. The results of the analysis indicate that the announcement of buying corporate bonds by the European Central Bank caused the spreads of the ineligible corporate bonds to decrease. This would suggest that portfolio rebalancing holds. The second part of this study was centred on the magnitude of the changes in spreads after the announcement, however no statistically significant results were found.

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Due to the rising ecological issues the focus towards green bonds has soared. The green bond is developing in a record pace while the rationale and logic behind their issuance remains rather unexplored. In this paper green bond issuer characteristics is discussed with evidence from the Benelux region. The characteristics of firms that choose to issue green bonds are investigated compared to conventional corporate bonds. Based on data retrieved from Eikon/DataStream, Orbis Global and Sustainalytics a sample is obtained with firms issuing green and conventional corporate bonds issued in the Euro currency in the Benelux. A binary regression was performed with 8 potential explanatory variables. The results of the paper show the characteristics and motives that drive firms to issue green bonds or not. The variables that appeared to be significant are profitability, current ratio, leverage, listed and green preference. Thus, profitable high leveraged private firms with low Environmental Social and Governance risk and current ratios have higher probabilities of issuing green bonds. These finding could have great impact on policy making to increase the volume of green bond issuance and so advance the transition to a green economy.

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The paramount global challenge of the 21st century revolves around addressing the pressing environmental emergency. In response to these environmental concerns, the issuance of green bonds has been increasing worldwide. This study analyses the pricing at issuance of green corporate bonds and their conventional counterparts, issued between 2016 and 2022 in the European financial market. The aim of this research is to explore the greenium which is a complex phenomenon researchers have been exploring from different angles, but literature offers very contrasting conclusions. The goal of this paper is to shed light on this topic through a multiple linear regression with the issue price being the dependent variable, and six independent variables. The variables that appeared to be significant are bond type, coupon rate, days to maturity, days from issuance, amount issued and seniority. Results show evidence for a slightly negative green premium and our findings suggest that the origin of the observed green discount lies beyond the characteristics of the bond itself. Various external factors contributing to this occurrence are explored, including green label legislation and greenwashing. As the green bond market continues to evolve, research around the greenium is key to ease the transition towards broader public engagement.

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The emergence of the macroprudential policy initiative has regained financial regulators around the world ample confidence in fighting against banking crisis. The use of macroprudential tools such as the Countercyclical Capital Buffer has provided banks sufficient capital support once the systemic risk materializes. Setup of the macroprudential policy within the European Union is mainly achieved by a national’s Central Bank, the National Authorities such as the Financial Stability Committee or by the Ministry of Finance within a nation’s government. This thesis aims to investigate on a country level the impact of institutional differences on the setup of the macroprudential policy by these authorities. Through data support on a quarterly basis covering all EU member states within 2016-19, it is found with logistic modeling that, both a nation’s Central Bank and the National Authorities play a vital role in the setup of the macroprudential policy; a better policy outcome can be reached when it is the National Authorities setting the Countercyclical Capital Buffer along with the Central Bank in charge of the implementation of the macroprudential policy, or, when it is the same institution taking on all the macroprudential duties; the Government may negatively impact the efficacy of implementing macroprudential measures, especially when it is involved in setting the Countercyclical Capital Buffer.