Foley-Fisher, Nathan
[VerfasserIn]
;
Narajabad, Borghan
[Sonstige Person, Familie und Körperschaft];
Verani, Stephane
[Sonstige Person, Familie und Körperschaft]National Bureau of Economic Research
Securities Lending as Wholesale Funding
: Evidence from the U.S. Life Insurance Industry
Erschienen:
Cambridge, Mass: National Bureau of Economic Research, October 2016
Erschienen in:NBER working paper series ; no. w22774
Umfang:
1 Online-Ressource
Sprache:
Englisch
DOI:
10.3386/w22774
Identifikator:
Reproduktionsnotiz:
Hardcopy version available to institutional subscribers
Entstehung:
Anmerkungen:
Mode of access: World Wide Web
System requirements: Adobe [Acrobat] Reader required for PDF files
Beschreibung:
The existing literature assumes that securities lenders primarily respond to demand from securities borrowers and reinvest their cash collateral in short-term markets. We offer compelling evidence for a supply channel, using new data matching U.S. life insurers' individual bond lending and reinvestment decisions to the universe of securities lending transactions. We show that an insurer's decision to lend a bond is positively correlated with liquidity transformation in its lending program, even after controlling for demand for that bond. We discuss how using securities lending cash collateral as a source of wholesale funding might impair securities markets in times of stress