Non-bank Financial Sector and Financial Stability

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Conference Event:
October 4, 2019

Event Location:
London School of Economics, London, Great Britain

Keynote speaker(s):
Ralph Koijen (University of Chicago Booth School of Business and CEPR)

London School of Economics

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

Link Conference: Non-bank Financial Sector and Financial Stability