5th DIW Lecture on Money and Finance
Regulation of Sovereign Exposures
The sovereign-bank nexus remains a major vulnerability of the euro area. While the introduction of the Single Supervisory Mechanism and the Single Resolution Mechanism have helped to mitigate the nexus, no progress has been made with respect to the regulation of sovereign exposures. In the talk, Isabel Schnabel explains why the sovereign-bank nexus matters, how sovereign exposures could be regulated (including some empirical simulations), and how this issue is related to other reform streams in the euro area.
Lecture by:
Prof. Dr. Isabel Schnabel
Professor of Financial Economics | Universität Bonn
Member of the German Council of Economic Experts
Discussant:
Dr. Levin Holle
Directorate-General for Financial Market Policy at the Federal Ministry of Finance
Moderator:
Prof. Dr. Dorothea Schäfer
Research Director Financial Markets at DIW Berlin
Isabel Schnabel is Professor of Financial Economics at the University of Bonn. Since 2014, she has been a member of the German Council of Economic Experts, an independent advisory body of the German government. She is also spokesperson of the Cluster of Excellence “ECONtribute: Markets & Public Policy”. Moreover, she is Research Fellow at the Centre for Economic Policy Research (CEPR) in London and at the CESifo in Munich, and Research Affiliate at the Max Planck Institute for Research on Collective Goods in Bonn. She is a member of the Administrative Council and Chair of the Advisory Council of the German Federal Financial Supervisory Authority (BaFin) and Vice Chair of the Advisory Scientific Committee (ASC) of the European Systemic Risk Board (ESRB). Her research focuses on financial stability, banking regulation, international capital flows, and economic history.
The DIW Lectures on Money and Finance bring together representatives of government, legislatures, the financial sector, think tanks, and academia to discuss how policy makers and monetary authorities can create policies and regulations that foster a more sustainable and stable financial system. Together with the speaker, we will debate the following questions: Do sovereign exposures of banks need a new regulation? What regulation do sovereign exposures need? What role should capital requirements have in a potential new regulatory framework? What role could an European safe asset play in this framework? What consequences are expected for banks and sovereigns?
DIW Berlin, Mohrenstraße 58, 10117 Berlin – Elinor Ostrom Hall, First Floor
in Zusammenarbeit mit:
