Browsing by Subject "joukkovelkakirjat"

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  • Verona, Fabio; Martins, Manuel M. F.; Drumond, Inês (2013)
    Bank of Finland Research Discussion Papers 4/2013
    Published in International Journal of Central Banking, Volume 9, Number 3, September 2013, Pages 73-117 ; http://www.ijcb.org/journal/ijcb13q3a3.htm
    Motivated by the U.S. events of the 2000s, we address whether a too low for too long interest rate policy may generate a boom-bust cycle. We simulate anticipated and unanticipated monetary policies in state-of-the-art DSGE models and in a model with bond financing via a shadow banking system, in which the bond spread is calibrated for normal and optimistic times. Our results suggest that the U.S. boom-bust was caused by the combination of (i) interest rates that were too low for too long, (ii) excessive optimism and (iii) a failure of agents to anticipate the extent of the abnormally favourable conditions. Keywords: DSGE model, shadow banking system, too low for too long, boom-bust JEL codes: E32, E44, E52, G24
  • Korhonen, Iikka (1997)
    IDÄNTALOUKSIEN KATSAUKSIA. REVIEW OF ECONOMIES IN TRANSITION 3/1997
    Russia's treasury bill market has taken off in recent years.The volume of outstanding stock has grown manyfold, so that the volume of trading on the secondary market is now enough to ensure liquidity.The yields of treasury bills, which once fluctuated wildly in response to trends in inflation and political uncertainty, have now settled to low enough levels where they may actually help stabilize Russian financial markets.If this, happens, we may soon expect to see increasing investments in production capacity. The T-bill market is mainly regulated by the Central Bank of Russia, which uses treasury bills as an instrument of monetary policy.Meanwhile, the government of the Federation of Russia has increasingly sought to use the T-bill market as a source of revenue.As the Central Bank of Russia will no longer extend direct credit to the government, inflation has naturally fallen.However, if there are to be further cuts in the yields of treasury bills, the government would probably have to curtail its borrowing.For this to happen the government must cut expenditures even further or improve its tax collection systems.
  • Marzo, Massimiliano; Romagnoli, Silvia; Zagaglia, Paolo (2008)
    Bank of Finland Research Discussion Papers 25/2008
    We study the term structure implications of the fiscal theory of price level determination. We introduce the intertemporal budget constraint of the government in a general equilibrium model in continuous time. Fiscal policy is set according to a simple rule whereby taxes react proportionally to real debt. We show how to solve for the prices of real and nominal zero coupon bonds. Keywords: bond pricing, fiscal policy, mathematical methods JEL classification numbers: D9, G12
  • Andersen, Kaare Guttorm; Kauko, Karlo (1996)
    Suomen Pankin keskustelualoitteita 13/1996
    The possibilities to improve households' eligibility for long-term housing loans at fixed interest rates has been a current topic of public discussion.Yet, credit institutions have difficulties in granting such loans, unless they themselves can acquire fixed-rate funding.In many cases, the only feasible way for them to raise such funding is to issue bonds.In a number of countries, such arrangements are already in use. In this paper we present a cross-country study of housing finance by mortgagebacked bonds.The paper describes and analyses mortgage credit markets in Denmark, Sweden and the United States of America with respect to the institutional structure, loans and bonds characteristics, legal framework and the security underlying the system.We have found that all three markets differ and that these differences originate from the respective countries' national characteristics and financial histories.In Sweden and the United States in particular, the public sector has been involved in developing the system. Generally, long-term credit is offered in all three countries through relatively well-functioning, efficient markets. However, certain problems are common to all.First, the number of outstanding bond series is relatively large.Second, in many housing loans, the borrower has the option to repay the debt prematurely.In these cases, the credit institution may have to avoid maturity matching problems by issuing bonds with unknown maturity. We briefly review the history and present circumstances of Finnish bond issuing credit institutions to elucidate why such institutions play a marginal role.Long ago, bond-issuing mortgage institutions were an essential part of the Finnish financial market, but legislative obstacles to their operations almost killed the industry after World War II.The tax system favoured ordinary banks, and bond emissions were restricted by government regulations.Now, these legal obstacles have been abolished.In the light of both foreign and past domestic experience, such institutions have a market niche.Finally, we discuss some of the problems related to setting up a bond- financed mortgage credit market in Finland. Key words: Housing loans, bonds, mortgage banks
  • Keloharju, Matti; Malkamäki, Markku; Nyborg, Kjell G.; Rydqvist, Kristian (2002)
    Suomen Pankin keskustelualoitteita; Bank of Finland. Discussion papers 16/2002
    This paper presents a descriptive analysis of the primary and secondary market for Finnish treasury bonds.The paper focuses on three issues.First, we report basic descriptive statistics such as auction volumes and secondary market yields and volumes.Second, we estimate the revenues earned by primary dealers from the treasury bond market.Third, we analyse the development of the price of the auctioned bonds, relative to other benchmark bonds, around the time of the auction.We find evidence of a price decrease in the auctioned bond series before the auction and a price increase after the auction.This pattern is strongest for 1992-1994 when Treasury funding needs were heavy and secondary market trading volume of treasury bonds was modest. Key words: treasury bond auctions, secondary market JEL classification numbers: D44, G12, G20
  • Taipalus, Katja (2003)
    Suomen Pankki. Rahoitusmarkkinaraportti Kevät
    Sijoitusten uudelleensuuntaaminen on lisännyt joukkovelkakirjalainojen kysyntää. Kysynnän kasvun vaikutukset näkyvät yhä selvemmin jvk- lainojen hinnoissa.
  • Willman, Alpo (1987)
    Tutkimusyksikkö. Monistettuja tutkimuksia 16/1987
    We show that if domestic and foreign bonds are imperfect substitutes for each other and the exchange rate is fixed, then, unlike under the perfect substitutability assumption, uncertainty about monetary policy reactions affects the timing of balance-of-payments crises.
  • Hasan, Iftekhar; Wu, Qiang; Zhang, Hao; Hoi, Chun-Keung (Stan) (2014)
    Bank of Finland Research Discussion Papers 3/2014
    Published in Journal of Financial Economics, 113 (2014) 109-130
    We find that firms with greater tax avoidance incur higher spreads when obtaining bank loans. This finding is robust in a battery of sensitivity analyses and in two quasi-experimental settings including the implementation of Financial Accounting Standards Board Interpretation No. 48 and the revelation of past tax sheltering activity. Firms with greater tax avoidance also incur more stringent non-price loan terms, incur higher at-issue bond spreads, and prefer bank loans over public bonds when obtaining debt financing. Overall, these findings indicate that banks perceive tax avoidance as engendering significant risks. JEL Classification: G21; H26 Keywords: Tax avoidance; Cost of bank loans; Information risk; Agency risk; Audit risk; FIN 48
  • Chang, Roberto; Fernández, Andrés; Gulan, Adam (2016)
    Bank of Finland Research Discussion Papers 22/2016
    Published in Journal of Monetary Economics, Volume 85, 1 January 2017: 90-109 http://dx.doi.org/10.1016/j.jmoneco.2016.10.009
    Corporate sectors in emerging markets have noticeably increased their reliance on foreign financing, presumably reflecting low global interest rates. The evidence also shows a rebalancing from bank loans towards bonds. To study these developments, we develop a dynamic open economy model where these modes of finance are determined endogenously. The model replicates the stylized facts following a drop in world interest rates; in particular, rebalancing towards bonds occurs because bank credit becomes relatively more expensive, reflecting the scarcity of bank equity. More generally, the model is suitable for studying interactions between modes of finance and the macroeconomy.
  • Chang, Roberto; Fernández, Andrés; Gulan, Adam (2017)
    Journal of Monetary Economics January
    BoF DP 22/2016
    Corporate sectors in emerging markets have noticeably increased their reliance on foreign financing, presumably reflecting low global interest rates. The evidence also shows a rebalancing from bank loans towards bonds. To study these developments, we develop a dynamic open economy model where these modes of finance are determined endogenously. The model replicates the stylized facts following a drop in world interest rates in particular, rebalancing towards bonds occurs because bank credit becomes relatively more expensive, reflecting the scarcity of bank equity. More generally, the model is suitable for studying interactions between modes of finance and the macroeconomy.
  • Pylkkönen, Pertti (2008)
    Bank of Finland. Financial market report 1
    Bond guarantors' credit ratings are on watch and risk premia have risen. The price of default protection provided by these bond insurers has also risen considerably.
  • Vauhkonen, Jukka (2005)
    Bank of Finland. Financial market report 2
    The narrowing of interest rate spreads between high- and low-risk bonds has been one of the clearest trends in the international bond markets in recent years. But interest rate spreads widened, at least temporarily, in the spring, triggered by the problems of American auto manufacturers Ford and General Motors.
  • Taipalus, Katja (2005)
    Bank of Finland. Financial market report 3
    The future prospects for both corporate and government bonds raise questions. The reasons are narrow interest rate spreads for corporate bonds and low longterm interest rates for government bonds.
  • Toivanen, Mervi (2009)
    Bank of Finland. Financial market report 1
    The uncertainty caused by the financial crisis continues to hamper the acquisition of long-term funding and raise the price of funding. This has caused problems particularly for monetary financial institutions (MFIs).
  • Martins, Manuel M. F.; Verona, Fabio (2021)
    Finance Research Letters March
    The typical increase of the corporate bond-to-bank ratio during downturns is known to mitigate business cycle recessions. In the three longest and deepest post-war U.S. recessions this ratio didn't increase from their outsets. In this paper we focus on the timing of the corporate bank-to-bond substitution in the Great Recession, simulating counterfactual paths for output growth under plausible notional behaviors of the bond-to-bank ratio. We find that the Great Recession would have been milder and the recovery much stronger if the bank-to-bond substitution had started since the outset of the recession and evolved thereafter as in most U.S. recessions.
  • Fungáčová, Zuzana; Kurronen, Sanna (2010)
    Bofit. Focus/Opinion. Expert view 1/2010
  • Granziera, Eleonora; Sihvonen, Markus (2020)
    Bank of Finland Research Discussion Papers 7/2020
    We propose a model in which sticky expectations concerning short-term interest rates generate joint predictability patterns in bond and currency markets. Using our calibrated model, we quantify the effect of this channel and find that it largely explains why short rates and yield spreads predict bond and currency returns. The model also creates the downward sloping term structure of carry trade returns documented by Lustig et al. (2019), difficult to replicate in a rational expectations framework. Consistent with the model, we find that variables that predict bond and currency returns also predict survey-based expectational errors concerning interest and FX rates. The model explains why monetary policy induces drift patterns in bond and currency markets and predicts that long-term rates are a better gauge of market’s short rate expectations than previously thought.
  • Pessarossi, Pierre; Weill, Laurent (2011)
    BOFIT Discussion Papers 29/2011
    Published in China Economic Review, Volume 26, September 2013, Pages 1-16
    We analyze the determinants of debt choices for Chinese firms between bonds and syndicated loans. This issue helps appraise the weak development of bond market in China. We test if flotation costs, asymmetries of information, and renegotiation and liquidation costs influence the choice of debt in line with former studies in the context of regulatory interference in the bond market. We check the role of central state ownership on debt choice in order to assess to what extent corporate debt choices are politically or economically driven. We test these hypotheses on a dataset of 220 listed Chinese firms over the period 2006 2010. We find evidence in favour of the influence of central government ownership on the financing choices of firms it owns, as central state-owned firms are more likely to issue bonds. We also observe limited support for the premise that this influence is stronger for central state-owned firms located closer to the capital. Furthermore, we identify that these companies tend to borrow uniquely on the bond market rather than tapping both debt markets. We provide evidence in favour of the flotation costs hypothesis, but provide mixed evidence for the information asymmetry hypothesis and rather reject the renegotiation and liquidation hypothesis. All in all, our findings show that financial factors play a much more minor role in corporate debt choices compared to other countries, whereas state ownership remain a key determinant of preferring the bond market.
  • Pylkkönen, Pertti (2004)
    Bank of Finland. Financial market report 4
    Favourable market conditions notwithstanding, the growth of corporate bond issuance in the euro area has been modest. In Finland, the stock of corporate bonds has contracted this year.
  • Pylkkönen, Pertti (2009)
    Bank of Finland. Financial market report 2
    The markets for covered bonds used for financing housing, other real estate and the public sector have recovered as the financial crisis has eased.