PhD Defense N.M. Sarmiento Paipilla

Banks interact across different markets in order to diversify their risk exposure and to obtain funding from alternative sources. While this can increase bank efficiency and alleviate financial intermediation costs, it makes more difficult the effective regulation and supervision of banks and can expose them to liquidity shocks and contagion risk, as evidenced during the Global Financial Crisis of 2007-08. This Ph.D. dissertation consists of four chapters on banking, financial intermediation, and financial markets. The main objective of the thesis is to analyze the behavior of banks across different financial markets, and to explore the role of risk-taking, regulation, and liquidity shocks. Chapter 2 proposes an alternative approach to study the allocation of central bank liquidity among the participants of the unsecured interbank market. Chapter 3 examines the heterogeneous effects of risk-taking on bank efficiency. Chapter 4 evaluates the impact of idiosyncratic and aggregate liquidity shocks on the access and pricing of liquidity in the unsecured interbank funds market. Lastly, chapter 5 analyses the determinants of loan pricing in the cross-border syndicated market and the potential de-risking role of multilateral development banks.

Miguel Sarmiento obtained the B.A. degree in Economics from Universidad Externado de Colombia, in 2004. He went on to work at the Central Bank of Colombia until 2011. In May 2013, he received the MSc in Economics degree from the University of Illinois at Urbana-Champaign, in the United States. Since November 2013, he has been Junior Fellow at the European Banking Center, and then he was admitted as PhD candidate at the Department of Economics at Tilburg University. He has been affiliated to the Financial Stability Department of the Central Bank of Colombia, and to the International Monetary Fund.

• Location: Cobbenhagen building, Portraits room (access via Koopmans building)
• Supervisors: Prof. H.P. Huizinga
• Co-supervisor: Dr. O.G. De Jonghe