Date: Friday 4 October 2019, 8:30am - 6:15pm  

Venue: LSE, Pankhurst House, 9th floor, 1 Clement's Inn, London, WC2A 2AZ
 

Keynote speaker: Ralph Koijen (Professor of Finance and Fama Faculty Fellow, University of Chicago Booth School of Business and CEPR)

Non-bank financial intermediation comprises almost half of the global financial sector. Since the crisis, UK private non-financial corporations have also substituted funding from banks for tradable securities. Alongside these changes, the share of electronic trading in financial markets has increased substantially over the last decades.

Therefore, the resilience of the non-bank financial sector and the evolving market infrastructure is crucial for the financial system to play its crucial role of providing funding to the real economy. Their resilience will also ensure that the financial system overall absorbs, rather than amplifies, stresses.

In order to assess the financial stability implications of these recent developments, it is important for academics and policy makers to improve their understanding of risks arising from the behaviour of non-bank financial institutions and the evolution of the supporting market infrastructure, and how to deal with those risks.

The Paul Woolley Centre at the London School of Economics in partnership with the Bank of England, the CEPR, and the Brevan Howard Centre at Imperial College are keen to attract theoretical and empirical papers that enhance the understanding of the following themes:

Theme 1- Non bank financial institutions and their impact on financial markets

  • Contracts, incentives and portfolio choices of non-banks
  • Effects of non-banks on asset markets in equilibrium
  • Effects of non-banks on the real economy
  • Policy interventions and macro-prudential tools for non-banks
 

Theme 2- Financial market infrastructure

  • Trading activity and liquidity in dealer-intermediated markets
  • Costs and benefits of high-frequency trading
  • Systemic risk in derivative markets
  • Dark pool markets
  • Fintech
 

The programme can be downloaded here.

 

Slides are available for download below.

Keynote lecture

The Low Rate Environment and the Fragility of Market Risk Insurance
Presented by: Ralph Koijen, Professor of Finance and Fama Faculty Fellow, University of Chicago and CEPR (slides)

Session 1: Central Clearing

 

Central Counterparty and the Design of Collateral Requirements
Presented by: Jessie Wang, Arizona State University (slides)
Discussant: Wenqian Huang, Bank for International Settlements (slides)

The Cost of Clearing Fragmentation
Presented by: Evangelos Benos, Bank of England
Discussant: Ansgar Walther, Imperial College

Session 2: Collateral and Credit Provision

 

Re-use of collateral: leverage, volatility, and welfare
Presented by: Michael Grill, European Central Bank (slides)
Discussant: Georgy Chabakauri, London School of Economics (slides)

 

Corporate Credit Provision
Presented by: Nina Boyarchenko, New York FED and CEPR (slides)
Discussant: Saleem Bahaj, Bank of England (slides)

Session 3: Fire Sales

Similar Investors
Presented by: Diane Pierret, Luxembourg School of Finance, University of Luxembourg (slides)
Discussant: Wolf Wagner, Rotterdam School of Management and CEPR 

Mitigating Fire Sales with Contracts: Theory and Evidence
Presented by: Guillaume Vuillemey, HEC Paris and CEPR (slides)
Discussant: Peter Kondor, London School of Economics and CEPR (slides)

Session 4: Liquidity Creation and Regulation

Dealer Funding and Market Liquidity
Presented by: John Kuong, INSEAD (slides)
Discussant: Jing Zeng, Frankfurt School of Finance and Management (slides)

Inefficient Liquidity Creation
Presented by: Paul Schempp, University of Cologne (slides)
Discussant: Egemen Eren, Bank for International Settlements (slides)
 

The conference is paired with Management Science. Authors of presented papers have the option to submit to Management Science with an expedited reviewing process. Papers can be submitted from 5 October 2019 to 31 January 2020.

 

Programme committee: Franklin Allen (Imperial and CEPR), Marco Bardoscia (BoE), Alina Barnett (BoE), Thummim Cho (LSE), Sinem Hacioglu Hoke (BoE), Arjun Mahalingam (BoE), Martin Oehmke (LSE and CEPR), Lukasz Rachel (BoE), Katrin Tinn (Imperial), Dimitri Vayanos (LSE and CEPR), Ansgar Walther (Imperial), Nora Wegner (BoE) and Kathy Yuan (LSE and CEPR).