Security Firm’s Capital Adequacy Regulation and Analysis－For Security Firms in Taiwan

• Main Authors: Yu-Lan Ma, 馬玉蘭
• Other Authors: Dr.Soushan Wu
• Format: Others
• Language: zh-TW
• Published: 1999
• Online Access: http://ndltd.ncl.edu.tw/handle/20938464177367730629

碩士 === 國立交通大學 === 經營管理研究所 === 87 === Because of the innovation and deregulation of financial markets, the safety of security firm is getting more and more important. The volatility of interest rate、exchange rate and stock index varies and fluctuates. The risky causes of financial markets increase. All the security firms are highly exposed. Therefore, the risk management of the brokers is more important. Capital Adequacy is one of the Surveillance System for Financial Institution. Because of the announcement of the Capital Adequacy for security firm by SFC from 1998, the study estimates the effect of risk-based capital regulation, and their impact on the risk adjustment of the security firm. The empirical investigation is carried out by using data 17 domestic security firms from 1995 to 1998. We design a two-field test to examine the significance or implication on security firms’ portfolio, and their bankruptcy risk. The empirical results suggest that (1) the security firms did respond to the new capital regulation by reshuffling their portfolios. The security firm tended to raise their capital levels or decrease their growth of liability in response to the promulgation of the new Act rather than reshuffling their asset portfolios toward less risky assets or less their asset growth. (2) the risk of security firms’ bankruptcy does increase.