The Optimal Capital Structure of Banks: Balancing Deposit Insurance, Capital Requirements and Tax-Advantaged Debt

The capital structure and regulation of financial intermediaries is an important topic for practitioners, regulators and academic researchers. In general, theory predicts that firms choose their capital structures by balancing the benefits of debt (e.g., tax and agency benefits) against its costs (e.g., bankruptcy costs). However, when traditional corporate finance models have been applied to insured financial institutions, the results have generally predicted corner solutions (all equity or all debt) to the capital structure problem. This paper studies the impact and interaction of deposit insurance, capital requirements and tax benefits on a bankÇs choice of optimal capital structure. Using a contingent claims model to value the firm and its associated claims, we find that there exists an interior optimal capital ratio in the presence of deposit insurance, taxes and a minimum fixed capital standard. Banks voluntarily choose to maintain capital in excess of the minimum required in order to balance the risks of insolvency (especially the loss of future tax benefits) against the benefits of additional debt. Because we derive a closed- form solution, our model provides useful insights on several current policy debates including revisions to the regulatory framework for GSEs, tax policy in general and the tax exemption for credit unions.

Identifying the roles of the Escherichia coli FtsZ-associated proteins by minimizing the requirements for division

Formation of the FtsZ ring (Z ring) in Escherichia coli is the first step in assembly of the divisome, a molecular machine composed of 14 known proteins which are all required for cell division. Although the biochemical functions of most divisome proteins are unknown, several of these have overlapping roles in ensuring that the Z ring assembles at the cytoplasmic membrane and is active. ^ We identified a single amino acid change in FtsA, R286W, renamed FtsA*, that completely bypasses the requirement for ZipA in cell division. This and other data suggest that FtsA* is a hyperactive form of FtsA that can replace the multiple functions normally assumed by ZipA, which include stabilization of Z rings, recruitment of downstream cell division proteins, and anchoring the Z ring to the membrane. This is the first example of complete functional replacement of an essential prokaryotic cell division protein by another. ^ Cells expressing ftsA* with a complete deletion of ftsK are viable and divide, although many of these ftsK null cells formed multiseptate chains, suggesting a role in cell separation for FtsK. In addition, strains expressing extra ftsAZ, ftsQ, ftsB, zipA or ftsN, were also able to survive and divide in the absence of ftsK. The cytoplasmic and transmembrane domains of FtsQ were sufficient to allow viability and septum formation to ftsK deleted strains. These findings suggest that FtsK is normally involved in stabilizing the divisome and shares functional overlap with other cell division proteins. ^ As well as permitting the removal of other divisome components, the presence of FtsA* in otherwise wild-type cells accelerated Z-ring assembly, which resulted in a significant decrease in the average length of cells. In support of its role in Z-ring stability, FtsA* suppressed the cell division inhibition caused by overexpressing FtsZ. FtsA* did not affect FtsZ turnover within the Z ring as measured by fluorescence recovery after photobleaching. Turnover of FtsA* in the ring was somewhat faster than wild-type FtsA. Yeast two-hybrid data suggest that FtsA* has an increased affinity for FtsZ relative to wild-type FtsA. These results indicate that FtsA* interacts with FtsZ more strongly, and its enhancement of Z ring assembly may explain why FtsA* can permit survival of cells lacking ZipA or FtsK.^

Examination of the influence of behavioral, normative and control beliefs on the adherence to a prescribed renal diet among elderly populations with chronic to end-stage renal disease

The 1999-2004 prevalence of chronic kidney disease in adults 20 year or older (15.5 million) is an estimated 7.69%. The risk of developing CKD is exacerbated by diabetes, hypertension and/or a family history of kidney disease. African Americans, Hispanics, Pacific Islanders, Native Americans, and the elderly are more susceptible to higher incidence of CKD. The challenges of aging coupled with co-morbidities such as kidney disease raises the potential for malnutrition among elderly (for the purpose of this study 55 years or older) populations. Lack of adherence to prescribed nutrition guidelines specific to renal failure jeopardizes body homeostasis and increases the likelihood of future morbidity and resultant mortality. The relationship and synergy that exists between diet and disease is evident. Clinical experience with renal patients has indicated the importance of adherence to diet therapy specific to kidney disease. Extension investigation of diet adherence among endstage renal disease patients revealed a sizeable dearth in the current literature. This thesis study was undertaken to help reduce that void. The study design is qualitative and descriptive. Support, cooperation, and collaboration were provided by the University of Texas Nephrology Department, University of Texas Physicians, and DaVita Dialysis Centers. Approximately 105 male and female chronic to end-stage kidney disease patients were approached to participate in elicitation interviews in dialysis treatment facilities regarding their present diet beliefs and practices. Eighty-five were recruited and agreed to participate. Inclusion criteria required individuals to be between 35-90 years of age; capable of completing a 5-10 minute interview; and English speaking. Each kidney patient was asked seven (7) non-leading questions developed from the constructs of the Theory of Planned Behavior. The study presents a descriptive comparison of behavioral, normative, and control beliefs that influence adherence to renal diets by age, race, and gender. The study successfully concluded that behavioral, normative, and control beliefs of chronic to end-stage renal patients promoted execution and adherence to prescribed nutrition. This study provides valuable information for dietitians, technicians, nurses, and physicians to assess patient compliance toward prescribed nutrition and the means to support or improve that performance. ^

Seasonal and Rotational Influences on Corn Nitrogen Requirements

This project is designed to study the N fertilization needs in continuous corn (CC) and corn rotated with soybean (SC) as influenced by location and climate. Multiple rates of fertilizer N are spring applied, with the intent to measure yield response to N within each rotation on a yearly basis for multiple years at multiple sites across Iowa. This will allow the determination of N requirements for each rotation, differences that exist between the two rotations, responses to applied N across different soils and climatic conditions, and evaluation of tools used to adjust N application.

Water Table Level as Influenced by Rainfall, Crop Requirements, and Tiling Method during the past Three Years

In 1979, a portion of the research farm was pattern tiled including the large tillage plots. This was used as an opportunity to compare tile installation methods: a conventional trenching machine (used widely prior to late 70s), and a trenchless “tile plow” machine. The tile plow inserted plastic tile using a mole approach, which is the current primary tiling method. This research showed that plow and trenching tiling methods were not significantly different and both provided adequate drainage. It also showed that water table measurements were influenced more by timing of water needs of the crop being grown and intensity of the rainfall event than tiling method. This report focuses on continued research completed on these trial plots from 2009 to 2011 measuring water table level.

Seasonal and Rotational Influences on Corn Nitrogen Requirements

This project was designed to study the N fertilization needs in continuous corn (CC) and corn rotated with soybean (SC) as influenced by location and climate. Multiple rates of fertilizer N were spring applied, with the intent to measure yield response to N within each rotation on a yearly basis for multiple years at multiple sites across Iowa. This will allow the determination of N requirements for each rotation, differences that exist between the two rotations, responses to applied N across different soils and climatic conditions, and evaluation of tools used to adjust N application.

Seasonal and Rotational Influences on Corn Nitrogen Requirements

This project was designed to study the N fertilization needs in continuous corn (CC) and corn rotated with soybean (SC) as influenced by location and climate. Multiple rates of fertilizer N were spring applied, with the intent to measure yield response to N within each rotation on a yearly basis for multiple years at multiple sites across Iowa. This will allow determination of N requirements for each rotation, differences that exist between the two rotations, responses to applied N across different soils and climatic conditions, and evaluation of tools used to adjust N application.

Seasonal and Rotational Influences on Corn Nitrogen Requirements

This project was designed to study the N fertilization needs in continuous corn (CC) and corn rotated with soybean (SC) as influenced by location and climate. Multiple rates of fertilizer N were spring applied, with the intent to measure yield response to N within each rotation on a yearly basis for multiple years at multiple sites across Iowa. This will allow the determination of N requirements for each rotation, differences that exist between the two rotations, responses to applied N across different soils and climatic conditions, and evaluation of tools used to adjust N application.