Aufsätze Ökonomik

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Aufsätze Sozialethik


Prof. Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.

Abhandlungen über Johann Heinrich Jung-Stilling

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Size of a bank

There is some dispute as to which characteristics should be used to measure the size of a bank. – The most important size indicator in the literature is usually the total amount of loans granted. However, it may be that an institution has transferred a good portion of its loans to special purpose entities through securitization, which then no longer appear on the bank’s balance sheet. – With regard to liquidity, it is also important to bear in mind that the sale of asset-backed securities can suddenly improve the liquidity ratio. – With regard to the regulatory capital ratio, this ratio is reduced if the institution has completely transferred the risks it has assumed to the market. – Whether and to what extent earnings, headcount, branch network and other (measurable!) factors should be used in determining bank size is probably difficult to decide satisfactorily in general. – See alliances, cross-border, off-balance sheet, bank size, optimal, bank mergers, bank-bust-because-small thesis, assertion strategy, decentralization principle, Gibrat rule, gigabank, size effects, consolidation, correspondent bank relationship, megamania, megamergers, multi-boutique approach, Octopus, Penrose theorem, fact formation, Sifi oligopoly, subsidiarity principle. – Cf. ECB Monthly Bulletin, February 2008, p. 101 (impact of securitization on traditional size indicators).

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
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