Narrow Results

Since the 1990s, interest in the role of small and microenterprises (SMMEs) in economic development has garnered considerable attention throughout academic and practioner circles. Widely known for their potential to help stimulate economic growth and as a potential avenue for poverty alleviation, the purpose and promise of small businesses have been widely publicized. However, to date, little research exists that adequately documents the specific capital needs of very small businesses (those with less than 20 employees) and microenterprises (those with less than 5 employees) and their owners at specific points in a business's development and growth. Using data from the 1992 Characteristics of Business Owners Survey, the 2002 Survey of Business Owners and the 2003 Survey of Small Business Finances, we analyze the different types of firms in the United States, the amount of capital used by firms of different size and the sources of capital used by firms of different sizes to assess how capital needs and sources differ for those businesses with less than 20 employees. Paying particular attention to businesses owned by women and minorities, we argue that the path of SMMEs differs substantially from the typical path of larger small businesses. In addition, we highlight the implications of our findings and provide our policy recommendations to address them.

This paper presents a Heston-based pricing model for contingent convertible bonds (CoCos). The main finding is that skew in the implied volatility surface has a significant impact on the CoCo price. Hence stochastic volatility models, like the Heston model, which incorporate smile and skew are appropriate in the context of pricing CoCos. The financial crisis of 2007–2008 triggered an avalanche of financial worries for financial institutions around the globe. After the collapse of Lehman Brothers, governments intervened and bailed out banks using tax-payer’s money. Preventing such bail-outs in the future and designing a more stable banking sector in general, requires both higher capital levels and regulatory capital of a higher quality. Bank debt needed therefore to be made absorbing. This is where CoCos come in. The Lloyds Banking Group introduced the first CoCo bonds as early as December 2009. Since the first issuance of a CoCo bond more than five years ago, the market has continued to grow and has now reached a size over €120bn. CoCos are hybrid financial instruments that convert into equity or suffer a write-down of the face value upon the appearance of a trigger event, often in terms of the bank’s CET1 level in combination with a regulatory trigger. The valuation of CoCos boils down to the quantification of the trigger probability and the expected loss suffered by the investors if such a trigger event eventually takes place. There are at least two schools of thought regarding valuation of CoCos. Structural models can be put at work or investors can rely on market implied models. The latter category uses market data (share prices, CDS levels and implied volatility, etc.) in order to calculate the theoretical price of a CoCo bond. In De Spiegeleer and Schoutens The Journal of Derivatives, the pricing of CoCo notes has been worked out in a market implied Black–Scholes context. In this paper we move away from the assumption of a constant volatility which is the back-bone of Black–Scholes based valuation and put the Heston model at work and study CoCos in a stochastic volatility context. The existence of a semi closed-form formula for European options pricing under the Heston model allows for a fast calibration of the model. In our approach we combined market quotes of listed option prices with CDS data. As a case study, the procedure was applied on the Tier 2 10NC $7\frac{5}{8}\%$ CoCo issued by Barclays in 2012.

Nick Land once described hyperstitions as “semiotic productions that make themselves real” — stories that actualize themselves and produce their own realities, imagining new futures for us all. As the full effects of human industrial civilization continue to unveil themselves in the Anthropocene as the beginnings of a process that will soon render the planet Earth uninhabitable, it becomes essential to track the stories that are developing and expanding their own mutant machinic systems of reproduction in order to understand what futures will have been available to us. In this chapter, we seek to become students of the mechanisms of replicative processes of some of the hyperstitions that are at work in organizations, individual and collective, of the Anthropocene. To do this, we track the imbrication of a series of stories of Thomas the fieldmouse, a meeting about something called “sustainable innovation,” and journal entries about a mall that lives forever at the end of the world in order to understand hyperstitions and the role that they can play in the storying of the future.

Microfinance has been recognised and considered as the common mechanism to provide credit for the poor and low-income people, especially people in rural areas. Since its initiation in Bangladesh in the seventies, it has been gradually embedded in national strategies of many developing countries as well as universal goal to combat with hunger and poverty in the new millennium. The chapter provides an overview of microfinance and microcredit. The chapter discusses who are the microfinance providers, who do they serve and how do they help the poor. The chapter also provides a summary of empirical evidence on the impact of microfinance.

The following sections are included:

• Introduction
• Stepping Up to the Liquidity Challenge: The Changing Role of CPM
• Regulatory Challenges
• Significant Challenges
• Managing Liquidity Risk
• Modeling Liquidity Risk
• A Continuing Journey