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NEWSLETTER of March 8, 2019

 

The following content has been added at finexpert:


Studies > Performance

J.P. Morgan

BLOCKCHAIN AND THE DECENTRALIZATION REVOLUTION: A CFO’S GUIDE TO THE POTENTIAL IMPLICATIONS OF DISTRIBUTED LEDGER TECHNOLOGY

With the advent of blockchain and increased adoption, J.P. Morgan’s Corporate Finance Advisory team, in conjunction with J.P. Morgan’s Digital Investment Banking team and Blockchain Center of Excellence, provides an informed view on the corporate implications of the rapidly changing interplay between finance and blockchain technology. Although the use of blockchain in the enterprise remains mostly in the proof-of-concept stage, CFOs and financial executives should continue to periodically evaluate the latest blockchain developments. >more

Studies > Performance

Deutsche Bank Research

EUROPEAN BANK PROFITS RISE TO POST-CRISIS PEAK DESPITE LOWER REVENUES IN 2018 - CAPITAL RATIOS DOWN FOR THE FIRST TIME

In 2018, net income at the major European banks climbed to its highest level since the financial crisis. Lower administrative expenses and a further fall in loan loss provisions to multi-year lows more than made up for a decline in revenues. Whereas net interest income stabilised, fee and commission income as well as trading income declined. >more

Studies > Corporate Finance

Allen & Overy

NON-BANK LENDING IN THE EUROPEAN UNION

Non-bank lending in the European Union is becoming an ever more significant source of financing for business. In light of its increasing importance to Europe’s economy, policymakers are re-evaluating their approach to this market and considering whether the existing regulatory framework remains appropriate. >more

Studies > Corporate Finance

European Investment Bank

EIB INVESTMENT REPORT 2018/2019: RETOOLING EUROPE’S ECONOMY

The Investment Report, issued annually by the European Investment Bank, provides a comprehensive overview and analysis of investment and the financing of investment in the European Union. It combines the exploration of investment trends with in-depth analysis, focusing especially on the drivers and barriers to investment activity. The report leverages on a unique set of databases and survey data, including EIBIS, an annual survey of 12 500 firms in Europe, which focuses on their assessment of investment and investment finance conditions, and which allows analysis with firm balance sheet information. >more


Research Papers > Corporate Finance

THE ECONOMIC COSTS OF FINANCIAL DISTRESS

Claudia Custodio, Miguel A. Ferreira, and Emilia Garcia-Appendini
2019
We estimate the economic costs of financial distress using local real estate shocks. We identify these effects by exploiting variation in real estate assets and financial leverage across suppliers. We find that clients reduce their reliance on suppliers that are highly levered and own more real estate assets in response to declines in real estate prices. More affected suppliers suffer a 10% larger decline in sales for the same client and year than less affected suppliers. The effect is more pronounced in more competitive industries, for durable and less specific goods, and when switching costs are low. Our results suggest that indirect costs of financial distress are economically important. >more

Research Papers  > Alternative Investments

MEASURING INSTITUTIONAL INVESTORS’ SKILL AT MAKING PRIVATE EQUITY INVESTMENTS

Daniel Cavagnaro, Berk A. Sensoy, Yingdi Wang, and Michael S. Weisbach
2018
Using a large sample of institutional investors’ investments in private equity funds raised between 1991 and 2011, we estimate the extent to which investors’ skill affects their returns. Bootstrap analyses show that the variance of actual performance is higher than would be expected by chance, suggesting that some investors consistently outperform. Extending the Bayesian approach of Korteweg and Sorensen (2017), we estimate that a one standard deviation increase in skill leads to an increase in annual returns of between one and two percentage points. These results are stronger in the earlier part of the sample period and for venture funds. >more