QUALITATIVE EASING AND RISK TRANSFER FROM CORPORATIONS TO CENTRAL BANKS

Roberto Moro Visconti, Maria Cristina Quirici

Risultato della ricerca: Contributo in rivistaArticolo in rivistapeer review

Abstract

When economies face deflation and de-growth, Central Banks can only activate unconventional monetary policies. Quantitative easing inflates the Central Bank balance sheet, printing money and adding liquidity to the system while qualitative easing modifies the asset composition. With qualitative easing, Central Banks absorb the risk, flattening the yield curve. Consequences for banks and corporate borrowers may be substantial. Both measures increase inflation and reduce borrowing risk premiums, with an impact on company’s balance sheet, widening economic and financial margins and decreasing the real value of debt. Corporate governance implications concern credit risk pooling, as well as (de)leverage, asset substitution and duration risk. This paper provides unprecedented analysis of the impact of ECB unconventional monetary policy on Euro-zone governance equilibriums.
Lingua originaleEnglish
pagine (da-a)201-210
Numero di pagine10
RivistaCORPORATE OWNERSHIP & CONTROL
Volume12
Stato di pubblicazionePubblicato - 2015

Keywords

  • Unconventional monetary policy
  • asset substitution
  • default risk
  • inflation
  • leverage
  • stakeholders
  • yield curve

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