02150cas a2200277 a 4500 AALejournalIMF017432 230101c9999 xx r poo 0 0eng d 5.00 USD 9781475577556 1018-5941 BD-DhAAL BD-DhAAL Chami, Ralph. What's Different about Bank Holding Companies? / Ralph Chami, Thomas Cosimano, Jun Ma, Celine Rochon. Washington, D.C. : International Monetary Fund, 2017. 1 online resource (58 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students The recent fnancial crisis highlighted the role of Bank Holding Companies (BHCs) in exacerbating the crisis and in transmitting monetary policy beyond the local economy to global markets. Yet, little is known about their behavior, as most models of banking typically focus on banks with a loan desk. We develop a dynamic model of a BHC that encompasses both a trading desk and a loan desk, and explore the role of risk attitude and overleveraging by the trading desk. We trace the impact of monetary policy and market innovations on bank behavior in the presence of Basel III type regulations. To our knowledge, this is a first such exercise. We show that the value of the BHC is enhanced by operating both desks, even if they both are subject to common market shocks. We explore alternative regulatory remedies to ongoing efforts to ring-fence the proprietary trading business, and show that regulations that target bank governance can mitigate possible rogue trading and the overleveraging problem. Mode of access: Internet Cosimano, Thomas. Ma, Jun. Rochon, Celine. IMF Working Papers; Working Paper ; No. 2017/026 Full text available on IMF http://elibrary.imf.org/view/journals/001/2017/026/001.2017.issue-026-en.xml IMF e-Library