1 Much of this literature focuses on developed economies, with relatively little research studying shadow banking in emerging markets, including what many believe to be a This paper provides a unique snapshot of the asset exposures of EU banks to shadow banking entities within the global financial system. banking sector arises in the financial system as a result of regulatory arbitrage by financial institutions. Shining a light on shadow banking by Richard Portes. The paper offers two contributions: 1. Shadow banking can be seen as a form of regulatory arbitrage that provides important financial intermediation functions distinct from those preformed by banks and capital banks [Claessens et al (2012)]. risk and regulatory arbitrage concerns posed by the shadow banking system. A quantitative model of mortgage lending suggests that regulation accounts for roughly 60% of shadow bank growth, while technology accounts for roughly 30%. 559 April 2012 JEL classification: G28, G20, G24, G01. 1 ... regulatory arbitrage. Shadow banking is a broad term that can mean different things. Regulatory arbitrage seems the dominant force • Shadow banks now control riskiest segment • Shadow banks issue large amounts of guarantees on behalf of taxpayers in a Key words: shadow banking, financial regulation Shadow Banking Regulation Tobias Adrian and Adam B. Ashcraft Federal Reserve Bank of New York Staff Reports, no. (*) José María Roldán is Chairman of the Spanish Banking Association. ... Regulatory Arbitrage —this is where capital, liquidity, taxation or information requirements are circumvented to make activities profitable that might otherwise not be. Keywords: Fintech, Shadow Banks, Regulatory Arbitrage, Lending, Mortgages, FHA banking demand.20 If driven exclusively by regulatory arbitrage, shadow banking may not represent a public good. Drawing on a r… They document The FSB issued a background note in April that set out its thinking mainly on the first item and invited views from the public on taking the work forward. Acharya, Schnabl, and Suarez (2010) focus on the economics of ABCP conduits. In the paper, Shadow Banking and Bank Capital Regulation, forthcoming in the Review of Financial Studies, I offer a model of optimal banking regulation in the presence of regulatory arbitrage that can be used to assess this concern. 6 Subsequently, the Task Force The shadow banking system and regulatory arbitrage: the eternal return? Shining a light on shadow banking by Richard Portes. ... in what looks like a classic case of regulatory arbitrage, the increased intensity of banking regulation has prompted activity to migrate to the more lightly regulated non-banking … Shadow Banking—A Framework. Assess role of technology and regulation in recent increase of market disruptors: Focus on largest consumer finance market 1. We wrote OP18 because, as a competition authority, we were concerned that much of the public debate about shadow banking focussed on regulatory arbitrage. At the roots, regulatory arbitrage therefore is a hybrid concept: arbitrage brings in the economic, regulation the legal perspective.