Fine-tuning the use of bail-in to promote a stronger EU financial system. CEPS Special Report No. 136/April 2016

This paper discusses the application of the new European rules for burden-sharing and bail-in in the banking sector, in view of their ability to accommodate broader policy goals of aggregate financial stability. It finds that the Treaty principles and the new discipline of state aid and the restructuring of banks provide a solid framework for combating moral hazard and removing incentives that encourage excessive risk-taking by bankers. However, the application of the new rules may have become excessively attentive to the case-by-case evaluation of individual institutions, while perhaps losing sight of the aggregate policy needs of the banking system. Indeed, in this first phase of the banking union, while large segments of the EU banking sector still require a substantial restructuring and recapitalisation, the market may not be able to provide all the needed resources in the current environment of depressed profitability and low growth. Thus, a systemic market failure may be making the problem impossible to fix without resorting to temporary public support. But the risk of large write-offs of capital instruments due to burden-sharing and bail-in may represent an insurmountable obstacle to such public support as it may set in motion an investors’ flight. The paper concludes by showing that existing rules do contain the flexibility required to accommodate aggregate policy requirements in the general interest, and outlines a public support scheme for the precautionary recapitalisation of solvent banks that would be compliant with EU law.

Ibarra Peña, Alex. Filosofía chilena. La tradición analítica en el período de institucionalización de la filosofía. Bravo y Allende, 2011, Prólogo de José Santos Herceg. 136 pp. ISBN 978-956-307-049-1

Fil: Karczmarczyk, Pedro. Universidad Nacional de La Plata. Facultad de Humanidades y Ciencias de la Educación. Instituto de Investigaciones en Humanidades y Ciencias Sociales (UNLP-CONICET); Argentina.

Ibarra Peña, Alex. Filosofía chilena. La tradición analítica en el período de institucionalización de la filosofía. Bravo y Allende, 2011, Prólogo de José Santos Herceg. 136 pp. ISBN 978-956-307-049-1

Fil: Karczmarczyk, Pedro. Universidad Nacional de La Plata. Facultad de Humanidades y Ciencias de la Educación. Instituto de Investigaciones en Humanidades y Ciencias Sociales (UNLP-CONICET); Argentina.

Radiolarians of DSDP Site 136-842 and Hole 136-843C

Deep-sea cores recovered at Sites 842 and 843 on Leg 136 of the Ocean Drilling Program have yielded assemblages of Quaternary, Eocene, and Cretaceous radiolarians from the Hawaiian Arch region of the northern equatorial Pacific Ocean. Reddish-brown clays from Hole 842A (0-9.6 mbsf), Hole 842B (0-6.3 mbsf), and Hole 843C (0-4.2 mbsf) contain abundant and diverse assemblages of Quaternary radiolarians consisting of more than 80 species typical of the equatorial Pacific region. Quaternary radiolarians at these sites are assignable to the Quaternary Collosphaera tuberosa Interval Zone and Amphirhopalum ypsilon Interval Zone. The boundary between these zones cannot be determined precisely because of the rarity of zonal markers below surface sediments. Correlations have been made between radiolarian occurrences and magnetostratigraphic events elsewhere in the Pacific Ocean, but similar correlations are difficult at Sites 842 and 843 because of poor subsurface preservation. Chert samples collected from intervals in Cores 842B-10X and 842C-1W have yielded radiolarian ages of lower Cenomanian to Santonian and lower Cenomanian, respectively. Radiolarian assemblages in volcanic sand layers in Sections 6 and 7 of Core 842A-1H (7.5-9.6 mbsf) contain lower and middle Eocene radiolarians admixed with abundant Quaternary faunas. Reworked Eocene radiolarians appear to be restricted to thin layers of volcanic sands within the cores, suggesting deposition by turbidity currents.