Centre for International Finance and Regulation

The Centre for International Finance and Regulation (CIFR) is a Centre of Excellence established in 2011 to address fundamental issues affecting the Australian financial industry. CIFR’s mission is to promote financial sector vibrancy, resilience and integrity, supporting Australia as a regional financial centre through leading research and education on systemic risk, market and regulatory performance and financial market developments. CIFR has funded 71 research projects, involving well over 100 researchers from domestic and international universities.

For Australia’s financial industry, CIFR provides a strategic link between academia, policy-makers, regulators and other industry participants.  By engaging with industry, undertaking world-class research, delivering highly relevant educational events and providing valuable inputs to stakeholders,

CIFR is supported by consortium partners including:

  • Government Partners: Australian Government Treasury and NSW Government Department of Industry
  • Australian University Partners: UNSW Australia, The University of Sydney, Macquarie University, University of Technology Sydney, The University of Melbourne and Australian National University
  • Research Centre Partners: CMCRC and SIRCA
  • Industry Partners: Commonwealth Bank, KPMG, Macquarie Bank and King & Wood Mallesons
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Centre for International Finance and Regulation

Working paper

30 Jun 2016

This working paper presents the results of a detailed comparative empirical study of sanctions imposed for insider trading in Australia, Canada (Ontario), Hong Kong, Singapore, New Zealand, the United Kingdom, and the United States. Insider trading is considered to be a serious form of...

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Working paper

30 Jun 2016

Using a unique but confidential database, this study examines the capital management practices of Australian banks under the Basel regulatory framework. We find evidence of a significantly negative relationship between the internally targeted capital buffers of banks and the state of the...

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Working paper

10 Jun 2016

Abstract

Beginning with [Johansen (1960)], computable general equilibrium (CGE) models have been widely applied to study the impact of a variety of economic policy issues. These include changes in macroeconomic or regional economic policies such as tariff reductions,...

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Working paper

06 Jun 2016

This paper analyses how borrower liquidity constraints and home equity relate to the realized loss given default (LGD) using the quarterly U.S. residential mortgage loan-level data observed from Q2 2005 to Q1 2015. We define defaulted loans with zero-LGD as cure loans and those with non-zero LGD...

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Working paper

03 Jun 2016

A study of market bubbles is generally considered a test of market eciency (or ineciency) since bubbles are concerned with rising prices that are detached from their fundamental values. Verifying the existence of such an ineciency requires us to be able to appropriately formulate fundamental...

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Working paper

31 May 2016

We present an empirical model of systemic banking crises from an Australian perspective. Having no history of domestic banking crises in recent history, our quantitative model is estimated using an international panel data set spanning 18 countries and 30 years of observations. We evaluate in a...

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Working paper

31 May 2016

This paper develops, analyses and implements an early warning tool for systemic risk in banks and financial entities. The tool is based on a refined approach to stress testing. Calculations performed on Australian bank data are shown to predict past distres. Risk is measured as a function of...

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Working paper

30 May 2016

The literature on investment horizon is reviewed in order to enhance the understanding of potential influences on long-term investing by institutional investors. Investment horizon reflects an inter-connected web of influences related to an investor’s circumstances, the design of the investing...

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Working paper

30 Apr 2016

We introduce an endogenous network model of the interbank overnight lending market. Banks are motivated to meet the minimum reserve requirements set by the Central Bank, but their reserves are subject to random shocks. To adjust their expected end-of-the-day reserves, banks enter the interbank...

Working paper

30 Apr 2016

This paper investigates the impact of mandatory risk disclosure on the design of foreign bank debt. The Basel II and III Accords require the public disclosure of bank regulatory information under the Pillar 3 or market discipline framework. The new information details bank risk exposures and...

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Working paper

30 Apr 2016

As China’s financial system has become more complex and integrated, calls have intensified for structural reform. In particular, many commentators have called for China to move towards the twin peaks model of financial regulation along the lines of the experience in Australia. This paper...

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Working paper

30 Apr 2016

This working paper reports the findings of a detailed empirical study of 414 enforceable undertakings accepted by the Australian Securities and Investments Commission (ASIC), the corporate, market, finance and credit services regulator from July 1998 to 31 December 2015, a period of 17.5 years...

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Working paper

30 Apr 2016

Financial regulators in Australia and overseas are requiring banks to raise additional capital. The benefits of this are understood in terms of reducing the risk of incurring the significant costs of another financial crisis. But there are potential costs from securing these benefits, in the...

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Working paper

30 Apr 2016

For many years independence has been the catch-cry of policy-makers, regulators and legislators
concerned with the corporate governance of listed companies. In Australia, drawing on this model,
there has been an increased focus on independence in the context of superannuation fund...

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Submission

05 Apr 2016

We believe that stating the objective for superannuation in isolation is a second-best solution. Income in retirement is supported by the pillars of social security payments (including the age pension), superannuation drawdowns, and assets outside of superannuation (including, most notably,...

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Working paper

31 Mar 2016

We survey the long-term derivative instruments (warrants) offered by Australian institutions to elderly Australian investors. Our focus is on products other than plain-vanilla life annuities. There are currently four active products. They incorporate a strike price which is either constant or...

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Working paper

30 Mar 2016

An overlooked aspect of the debate surrounding Australia’s dividend imputation system is the international experience with dividend imputation. Between 1999 and 2008, nine countries removed their dividend imputation systems. A number of questions arise. What was the motivation for removing...

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Working paper

Video podcast

30 Mar 2016

We propose a framework that asset owners can use for making and implementing any decision to manage
investments in-house. It involves addressing four elements: capabilities, costs, alignment and governance;
with key aspects identified for consideration within each element. The...

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Working paper

30 Mar 2016

The failure of the Federal government’s Superannuation Legislation Amendment (Trustee Governance) Bill 2015 to pass through the Senate in November 2015 means that the political spotlight has for the time being shifted away from the issue of independence on superannuation fund boards. This...

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Working paper

30 Mar 2016

We model the tax drag from active funds management by simulating portfolios based on reported
monthly holdings of 207 active Australian equity funds between July 2000 and December 2010, and
then compare both pre-tax- and after-tax fund returns versus those for passive indices modeled...

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