The Legal Structure of Commercial Banks and Financial Regulation : does organizational form matter for the design of bank regulation?

Regulation? - An Overview of the Thesis .......................................................................1 1. RESEARCH QUESTIONS AND OBJECTIVES ........................................................... 5 2. MOTIVATION ................................................................................................................... 8 3. PLACING THE THESIS WITHIN THE LITERATURE ........................................... 11 4. METHODS........................................................................................................................ 16 5. THESIS STRUCTURE .................................................................................................... 17

Partitioning in the United Kingdom ............................................................................169 1. INTRODUCTION .......................................................................................................... 170 2. SOME ECONOMIC ASPECTS OF BANK RING-FENCING ................................. 177 2.1. What is Bank Ring-Fencing? .................................................................................... 177

Conclusions - the Legal Organization of Banks Matters for Financial Regulation221 1. CONCLUDING REMARKS......................................................................................... 221 2. WHAT HYPOTHESES COULD BE DRAWN FROM THIS THESIS.................... 224 3. SOME LIMITATIONS.................................................................................................. 226 4. WIDER POLICY IMPLICATIONS AND OPPORTUNITIES FOR FUTURE RESEARCH ........................................................................................................................... 227 The Legal Organization of Non-Bank Financial Institutions .............................................. 227 Legal Structure and Regulatory Compliance ...................................................................... 229 The Political Economy of Banking Structural Reforms...................................................... 230 BIBLIOGRAPHY.................................................................................................................. 233 SUMMARY ............................................................................................................................ 266 SAMENVATTING ................................................................................................................ 267

Figure 1. Linkage Between Legal Form and Financial Regulation.....................................8

Figure 2. Liquidation Protection and Creditor Rank .........................................................83

Figure 3. FDIC Bank Claims Priority Structure ..............................................................100

Figure 4. Bank Ownership and Voting Rules....................................................................97

Figure 5. Bank Capital to Total Assets Ratio for Selected Countries .............................117

Figure 6. 8% Total Capital Ratio Under Basel III ...........................................................124

Figure 7. Total Regulatory Capital to RWA Under Basel I and Basel III.......................133

Figure 8. Entity Shielding and MPE Resolution Strategies.............................................165

Figure 9. Subsidiarization as Asset Partitioning..............................................................194

Figure 10. Sibling Structure of a Group Containing a RFB ............................................205

Figure 11. Discouraged Structure I for RFBs..................................................................206

Figure 12. Discouraged Structure II for RFBs ................................................................207