This course provide the intermediate and advanced background regarding bank empirical issues. Students are expected to learn knowledge on the two major subjects and make good preparation for the advanced courses.

This is an advanced course for global financial system. The aim of this course is to build upon their previous knowledge of financial markets by analyzing the international financial system and evaluating the process of globalization. The integration of global financial markets has been a major feature of the financial services industry over the last decade. Our discussion covers two parts, one is related to international finance with the particular focus on crisis prediction and prevention; the other is related to the global banking issues.
Perquisites:
Because this is an advanced level course, students are required to have background on international economics, banking and corporate finance. This is particularly suitable for students who have some themes or issues in mind.


Evaluations
A. Essay Survey. This is a lecture course. Students need to write down the goals of papers that we are covering.
B. Students are rotated to present the academic papers several times. Then, we discuss the materials in your presentation. Each student is hopefully to read the paper before attending the course.
C. Reports: each student needs to hand in a complete term paper (Word file) around 30 pages.
D. Participation Rate: students need to participate the discussion in the class.

Topic I:
1. Base III:
a. Alaa Guidara, Van Son Lai, Issouf Soumar, Fulbert Tchana Tchana, 2013, “Banks’ capital buffer, risk and performance in the Canadian banking system: Impact of business cycles and regulatory changes”, Journal of Banking & Finance, 37, 3373–3387
b. Adrian F. Rossignolo, Meryem Duygun Fethi, Mohamed Shaban, 2013, “Market crises and Basel capital requirements: Could Basel III have been different? Evidence from Portugal, Ireland, Greece and Spain (PIGS)”, Journal of Banking & Finance, 37, 1323–1339
c. “Systemic risk, Basel III, global financial stability and regulation”, 2012, Journal of Banking & Finance, 36, 3123–3124
d. Andreas Dietrich, Kurt Hess, Gabrielle Wanzenried, “The good and bad news about the new liquidity rules of Basel III in Western European countries”, Journal of Banking & Finance
e. Isabelle Distinguin , Caroline Roulet, Amine Tarazi, 2013, “Bank regulatory capital and liquidity: Evidence from US and European publicly traded banks”, Journal of Banking & Finance, 37, 3295–3317
2. Bank ratings:
a. Gwion Williams, Rasha Alsakka, Owain ap Gwilym, 2013, “The impact of sovereign rating actions on bank ratings in emerging markets”, Journal of Banking & Finance, 37, 563–577
b. Chung-Hua Shen, Yu-Li Huang, 2013, “E?ects of earnings management on bank cost of debt”, Accounting and Finance, 53, 1, 265-300
3. Liquidity
a. Allen, B., K. K. Chan, A. Milne , and S. Thomas (2012), “Basel III: Is the cure worse than the disease? ” International Review of Financial Analysis, 24, 159-166.
b. Angelini, P., L. Clerc, V. Curdia, L. Gambacorta, A. Gerali, A. Locarno, R. Motto, W. Roeger, S. Van den Heuvel, and J. Vl?ek (2011), “BASEL III: Long-term impact on economic performance and fluctuations,” Staff Report, Federal Reserve Bank of New York, No. 485.
c. Distinguin, I., C. Roulet, A. Tarazi (2013), “Bank Regulatory Capital and Liquidity: Evidence from US and European Publicly Traded Banks,” Journal of Banking and Finance, 37, 3295-3317.
d. Haan, L. D. and J. W. van den End (2013), “Bank Liquidity, the Maturity Ladder, and Regulation,” Journal of Banking and Finance, 37, 3930-3950.
e. International Monetary Fund (2012) “Spain: Financial System Stability Assessment,” IMF Country Report No. 12/137.
f. King, M. (2013), “The Basel Ⅲ Net Stable Funding Ratio and Bank Net Interest Margins,” Journal of Banking and Finance, 37, 4144-4156.
g. Wu, D. and H. Hong (2012) , “ The Information Value of Basel III Liquidity Risk Measures,” Working Paper.
h. Yan, M., M. J.B. Hall, P. Turner (2012, “A cost–benefit analysis of Basel III: Some evidence from the UK” International Review of Financial Analysis, 25, 73-82.
4. Financial Structures
a. *A new data base on financial development and structure, Demirguc-Kunt and Levine, World Bank
b. Financial Structure and Economic Growth: Perspectives and Lessons, Demirguc-Kunt and Levine, 2001, in FSEC
c. The Financial Structure Database, 17-80 in FSEC
d. *Bank-Based and Market-Based Financial Systems: Cross-Country Comparisons, Beck, Demirguc-Kunt, Levine and Makasimovic, 189-
e. Financial Structure and Bank Profitability, Demirguc and Huizinga, 243-262
f. Bank based and Market Based, which is better, Levine, 2000
5. Bank’s Earnings Management
a. The World Price of Earnings Opacity, Bhattacharya, Daouk and Welker, Accounting Review, 2003, 78, 641-678
b. *Investor Protection, Prospect Theory, and Earnings Management: An International Comparison of the Banking Industry, Shen and Chih, JBF, 2005, 2675-2697
c. *Banks vs. Non-Bank Firms: Factors and Trends in Earnings Management around the World, Chi, Chih and Shen,
d. Management of the loss reserve accrual and the distribution of earnings in the property-casualty insurance industry, Beavere, McNichols and Nelson, JAE, 2003, 347-376
6. Banking Regulation
a. Financial Regulation and Performance: Cross Country Evidence, Barth, Caprio and Levine,
b. Bank Safety and Soundness and the Structure of Bank Supervision: A Cross-Country Analysis, Barth, Dopico, Nolle and Wilcox,
c. Commercial Banking Structure, Regulation, and Performance: An International Comparison, Barth, Nolle and Rice, 1997, OCC
7. Banking Concentration and Competition
a. Competition, concentration and their relationship: an empirical analysis of the banking industry, Bikker and Haaf, JBF, 2002
b. Bank Concentration and Crises, Beck, Demirguc-Kunt and Levine
c. Bank Concentration: Chile and International Comparisons, Levine, Central Bank of Chile
d. Bank Concentration: Cross-Country Evidence, Demirguc-Kunt and Levine, 2001, World Bank
e. What drives bank competition? Some international evidence, Claessens and Laeven, 2003, World Bank
f. Banking Market Structure, Financial Dependence and Growth: International Evidence from Industry Data, Cetorelli and Gambera, Journal of Finance
8. Loan Loss Provisions
a. Introductory of LLP, 金融市場和金融機構, 沈中華, 2005
b. Managerial Incentive for Income Smoothing Through Bank Loan Loss Provisions, Kanagaretnam, Lobo and Mathiem, 2001
c. Bank Loan Loss provision, A reexamination of Capital Management, Earnings management and Signaling Effects, Amhed, Takeda, Thomas 1998
d. *Do Bank Provision for Bad Loans in Good Times? Empirical Studies for Policy, Cavalo and Majnoni 2001
e. *Determinants of Loan Loss Provision: A Cross Country Comparison, Wall and Hasan, 2001
9. Law and Finance
a. Law and Finance: La Porta, Lopez-de-Silanes, Vishny, JPE, 1998, 106 (6), 1113-1155
b. Law, Finance and Firm Grwoth, Demirguc-Kunt and Maksimovic, Journal of Finance, 1998, LIII,6, 2107-2137
10. Corporate Governance
a. Corporate Ownership Around the World, La Porta, Lopez-de-Silanes, Vishny, JF, 1999, LIV (2), 471-517
b. Corporate Governance and Equity Prices: Gompers , Ishii and Metrick, NBER, 8449, 2001
c. The Separation of Ownership and Control in East Asian Corporations, Claessens, Djankov and Lang, JFE, 2000, 58, 81-112
11. Bank Governance
a. *The Corporate Governance of Banks, Macey and O’Hara, FRBNY, Economic Policy Review, April 2003, 91-107
b. *Is Corporate Governance Different for Bank Holding Companies, Adams and Mehran, FRBNY, Economic Policy Review, April 2003, 123-135
c. Governance and Bank Valuation, Caprio, Laeven and Levine, WB
d. *Bank Charter Values and Capital Levels: An International Comparison, Allen and Rai, JEB, 1996, 48, 269-284
e. Managerial Equity Ownership and Bank Performance: Entrenchment or Size Effects? Hirschey, EL, 1999, 209-213
f. Corporate governance and recent consolidation in the banking industry, Brook, Hendershott and Lee, JCF, 2000, 6, 141-164
g. Bank’s Changing Incentives and Opportunism for risk taking, Galloway, Lee and Roden, 1997, JBF, 21, 50-527
12. Foreign Bank Penetrations
a. *How does Foreign entry affect domestic banking markets, Claessens, Demiguc-Kunt and Huizinga, 2001 JBF, 891-911
b. The Impact of Foreign Bank Entry on domestic banking markets: a note, Hermes and Lensink, 2002
c. Performance of Domestic and Foreign Banks: The case of Korea and the Asian Financial Crisis, Jeon and Miller, 2002
13. Why Do Banks Expand Abroad
a. *To build or buy: an empirical study of the characteristics affecting a bank’s expansion decision, Ruffer and Holcomb, Journal of Economic Business, 2001
14. Banking Relationship
a. Ongena S., Smith, D. C., 2000. What determines the number of bank relationships? Cross-country evidence. Journal of Financial Intermediation 61, 449-475.
b. Ongena S., Smith, D. C., 2001. The duration of bank relationships. Journal of Financial Economics 61, 449-475.
c. Shen, C. H., 2002. Credit-rationing for bad companies in bad years: Evidence from bank loan transaction data. International Journal of Finance and Economics 7, 261-278.
d. Shen, Chung-Hua, and Chien-An, Wang, 2005. Does Banking Relationship Matter to Firm’s Investment and Financial Constraints? Evidence from the Taiwan’s Case. Pacific Basin Finance Journal. 13:2, 163-184
15. Distressed Banks and Distressed Firms
a. Bae, K., J. Kang, and C. Lim, 2002, The Value of Durable Relationship: Evidence from Korean Banking Shocks, Journal of Financial Economics 64, 181-214.
b. Dahiya S., A. Saunders, and A. Srinivasan, 2003, Financial Distress and Bank Lending Relationships, Journal of Finance 58, 1443-1493.
c. Ongena S., D. C. Smith, and D. Michalsen, 2003, Firms and their Distressed Banks: Lessons from the Norwegian Banking Crisis, Journal of Financial Economics 67, 81-112.
d. Shen, Chung-Hua, and Chien-An, Wang, 2005. The Impacts of the Distressed Banks’ (Firms’) Events on Their Client Firms’ (Borrowing Banks’) Stock Prices: Are They Symmetric? Under the first review for Journal of Comparative Economics (SSCI)
16. Bank Group
a. Ferris, S., K. Kim, and P. Kitsabunnarat, 2003, The Costs (and Benefits?) of Diversified Business Groups: The Case of Korean Chaebols, Journal of Banking and Finance, 27:251-273.
b. Hoshi, T., A. Kashyap, and D. Scharfstein, 1991, “Corporate Structure, Liquidity and Investment: Evidence from Japanese Industrial Groups,” The Quarterly Journal of Economics 106, 33-60.
c. Shen, Chung-Hua, and Chien-An, Wang, 2005. The Roles of Banks in Financial Groups: Evidences From Taiwan. Under the first review for Financial Management (SSCI)
17. Banking Crisis
a. Monitoring Banking sector Fragility: A Multivariate Logit Approach with an Application to the 1996-1997 Banking Crisis, Demirguc-Kunt and Detragiache, World Bank Economic Review, 14, 287-307, 2000
b. The determinants of Banking Crises: Evidence from Developing and Developed Countries, Demirguc-Kunt and Detragiache, 1997, WB
c. Banking Crises in Emerging Markets: Presumption and Evidence, Eichengreen and Arteta, 2000
d. Asset Price Crises and Banking Crises: Some Empirical evidence, Vila,
e. Basel III
18. Presentation (term paper)