Banking reforms, performance and risk in China

We investigate the impact of the banking reform started from 2005 on ownership structures in China on commercial banks’ profitability, efficiency and risk over the period 2000–2012, providing comprehensive evidence on the impact of banking reform in China. We find that banks on average tend to have higher profitability, lower risk and lower efficiency after the reforms, and the results are robust with our difference-in-difference approach. Our results also show that the Big 5 state-owned banks (SOCB) underperform banks with other types of ownership when risk is measured by non-performing loans (NPLs) over the entire study period but tend to have fewer NPLs than other banks during the post-reform period. Our results provide some supporting evidence on the ongoing banking reforms in China, suggesting that attracting strategic foreign investors and listing SOCBs on stock exchanges appear to be effective ways to help SOCBs deal with the problem of NPLs and manage their risk

Convertible bond announcement effects: why is Japan different?

U.S. and Japanese firms dominate global convertible bond issuance. Previous research documents more favorable convertible bond announcement effects in Japan than in the U.S. and other developed countries. Using a global sample of convertible bonds issued from 1982 to 2012, we find that the more favorable announcement effects of Japanese convertibles are driven by their stated uses of proceeds. Japanese convertibles more often include capital expenditure as an intended use, while U.S. firms tend to mention general purposes to motivate their offering. Our findings illustrate the value to firms of being more explicit when disclosing the intended use of proceeds of security offerings

Evidence that financing decisions contributed to the zero-earnings discontinuity

Open Access via the Springer Compact AgreementPeer reviewedPublisher PD

Security design, incentives, and Islamic microfinance : Cross country evidence

Acknowledgement We thank for the support from Institute of Belt and Road Studies, Sun Yat-sen University. All errors are ours.Peer reviewedPostprin

Magnetic quantum phase transition in a metallic Kondo heterostructure

We consider a two-dimensional quantum spin system described by a Heisenberg model that is embedded in a three-dimensional metal. The two systems couple via an antiferromagnetic Kondo interaction. In such a setup, the ground state generically remains metallic down to the lowest temperatures and allows us to study magnetic quantum phase transitions in metallic environments. From the symmetry point of view, translation symmetry is present in two out of three lattice directions such that crystal momentum is only partially conserved. Importantly, the construction provides a route to study, with negative-sign-free auxiliary-field quantum Monte Carlo methods, the physics of local moments in metallic environments. Our large-scale numerical simulations show that as a function of the Kondo coupling, the system has two metallic phases. In the limit of strong Kondo coupling, a paramagnetic heavy-fermion phase emerges. Here, the spin degree of freedom is screened by means of the formation of a composite quasiparticle that participates in the Luttinger count. At weak Kondo coupling, magnetic order is present. This phase is characterized by Landau-damped Goldstone modes. Furthermore, the aforementioned composite quasiparticle remains intact across the quantum phase transition.Comment: 19 pages, 15 figure

Marginal Fermi liquid at magnetic quantum criticality from dimensional confinement

Metallic quantum criticality is frequently discussed as a source for non-Fermi liquid behavior, but controlled theoretical treatments are scarce. Here we identify and study a novel magnetic quantum critical point in a two-dimensional antiferromagnet coupled to a three-dimensional environment of conduction electrons. Using sign-problem-free quantum Monte Carlo simulations and an effective field-theory analysis, we demonstrate that the quantum critical point is characterized by marginal Fermi liquid behavior. In particular, we compute the electrical resistivity for transport across the magnetic layer, which is shown to display a linear temperature dependence at criticality. Experimental realizations in Kondo heterostructures are discussed.Comment: 6 pages, 4 figure; Supplement: 12 pages, 12 figure

Nanostructures on fused silica surfaces produced by ion beam sputtering with Al co-deposition

The ion beam sputtering (IBS) of smooth mono-elemental Si with impurity co-deposition is extended to a pre-rippled binary compound surface of fused silica (SiO2). The dependence of the rms roughness and the deposited amount of Al on the distance from the Al source under Ar+ IBS with Al co-deposition was investigated on smooth SiO2, pre-rippled SiO2, and smooth Si surfaces, using atomic force microscopy and X-ray photoelectron spectroscopy. Although the amounts of Al deposited on these three surfaces all decreased with increasing distance from the Al target, the morphology and rms roughness of the smooth Si surface did not demonstrate a strong distance dependence. In contrast to smooth Si, the rms roughness of both the smooth and pre-rippled SiO2 surfaces exhibited a similar distance evolution trend of increasing, decreasing, and final stabilization at the distance where the results were similar to those obtained without Al co-deposition. However, the pre-rippled SiO2 surfaces showed a stronger modulation of rms roughness than the smooth surfaces. At the incidence angles of 60° and 70°, dot-decorated ripples and roof-tiles were formed on the smooth SiO2 surfaces, respectively, whereas nanostructures of closely aligned grains and blazed facets were generated on the pre-rippled SiO2, respectively. The combination of impurity co-deposition with pre-rippled surfaces was found to facilitate the formation of novel types of nanostructures and morphological growth. The initial ripples act as a template to guide the preferential deposition of Al on the tops of the ripples or the ripple sides facing the Al wedge, but not in the valleys between the ripples, leading to 2D grains and quasi-blazed grating, which offer significant promise in optical applications. The rms roughness enhancement is attributed not to AlSi, but to AlOxFy compounds originating mainly from the Al source

Can parents protect their children? Risk comparison analysis between affiliates of multi- and single-bank holding companies

We find that multi-bank holding companies (MBHCs) in the U.S. have lower insolvency risk than single-bank holding companies (SBHCs) at the parent level, but have significantly higher insolvency risk than the latter at the subsidiary level. Our results suggest that MBHC parents tend to benefit from the internal capital market while allowing for more risk-taking at the individual levels. We further find that the higher risk for MBHC affiliates is because of the organizational and geographic complexity at the MBHC parent level. Our results highlight the importance of government regulation on banks at both parent and subsidiary levels

Who acquires whom among stand-alone commercial banks and bank holding company affiliates?

This paper presents the difference in the likelihood of being targets or acquirers among stand-alone banks, single-bank holding company (SBHC) affiliates and multi-bank holding company (MBHC) affiliates. Using a sample of U.S. commercial bank data from 1997 to 2012, we find that MBHC affiliates exhibit a greater likelihood of being targets than do stand-alone commercial banks, while stand-alone banks have a greater probability of becoming targets than do SBHC affiliates. Our findings show that MBHC affiliates tend to have a greater likelihood of being acquirers than do SBHC affiliates, which again have a greater probability of being acquirers than do stand-alone banks. Those banks that acquire another bank within the same MBHC structure tend to be smaller and more financially constrained than those banks acquiring outside the same MBHC structure, whereas targets that are acquired by another bank within the same MBHC structure tend to be smaller, higher profitability and capital than targets that are acquired by banks from outside the MBHC structure. Our results suggest that the MBHC parent attempts to discipline distressed, poorly performing and smaller affiliates by involving them in mergers and acquisitions

A global dataset of spatiotemporally seamless daily mean land surface temperatures: generation, validation, and analysis

Daily mean land surface temperatures (LSTs) acquired from polar orbiters are crucial for various applications such as global and regional climate change analysis. However, thermal sensors from polar orbiters can only sample the surface effectively with very limited times per day under cloud-free conditions. These limitations have produced a systematic sampling bias (ΔT$_{sb}$) on the daily mean LST (T$_{dm}$) estimated with the traditional method, which uses the averages of clear-sky LST observations directly as the T$_{dm}$. Several methods have been proposed for the estimation of the T$_{dm}$, yet they are becoming less capable of generating spatiotemporally seamless T$_{dm}$ across the globe. Based on MODIS and reanalysis data, here we propose an improved annual and diurnal temperature cycle-based framework (termed the IADTC framework) to generate global spatiotemporally seamless T$_{dm}$ products ranging from 2003 to 2019 (named the GADTC products). The validations show that the IADTC framework reduces the systematic ΔT$_{sb}$ significantly. When validated only with in situ data, the assessments show that the mean absolute errors (MAEs) of the IADTC framework are 1.4 and 1.1 K for SURFRAD and FLUXNET data, respectively, and the mean biases are both close to zero. Direct comparisons between the GADTC products and in situ measurements indicate that the MAEs are 2.2 and 3.1 K for the SURFRAD and FLUXNET datasets, respectively, and the mean biases are −1.6 and −1.5 K for these two datasets, respectively. By taking the GADTC products as references, further analysis reveals that the T$_{dm}$ estimated with the traditional averaging method yields a positive systematic ΔT$_{sb}$ of greater than 2.0 K in low-latitude and midlatitude regions while of a relatively small value in high-latitude regions. Although the global-mean LST trend (2003 to 2019) calculated with the traditional method and the IADTC framework is relatively close (both between 0.025 to 0.029 K yr$^{–1}$), regional discrepancies in LST trend do occur – the pixel-based MAE in LST trend between these two methods reaches 0.012 K yr$^{–1}$. We consider the IADTC framework can guide the further optimization of T$_{dm}$ estimation across the globe, and the generated GADTC products should be valuable in various applications such as global and regional warming analysis