Financial conglomeration and monitoring incentives

Ville Mälkönen

Journal of Financial Stability, 2009, vol. 5, issue 2, 105-123

Abstract: If combining insurance and banking services generates scope economies in terms of monitoring the customers, competition in the financial markets becomes more intense after financial conglomeration. The pro-competitive effect reduces the prices of the financial services, increases monitoring and improves financial stability. Increased monitoring allows financial regulators apply lower capital requirements for financial conglomerates.

Keywords: Financial; conglomerates; Banking; Insurance; Capital; regulation (search for similar items in EconPapers)
Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finsta:v:5:y:2009:i:2:p:105-123

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